The Minister for Housing, Sylvia Pinel, and the Secretary of State for the Budget, Christian Eckert, have introduced measures to improve access to the zero-rate loan for first-time buyers. These measures put into practice the announcement that President François Hollande made on this subject on 29 October 2015.
These measures will come into force on 1 January 2016.
First of all, it should be remembered that the zero-rate loan (PTZ) is an additional interest-free, no-cost loan assisted by the State. It is aimed at buyers who have not owned their principal residence for at least 2 years, subject to certain conditions, particularly income.
The government wants to make it easier for people to buy their own home, with the aim of boosting activity and employment in the renovation and construction sectors, while giving young working people in particular the opportunity to own their own home.
As a result, the PTZ will be available on more advantageous terms from 1 January 2016, for both new and existing properties.
The main measures are as follows:
- The income threshold has been increased.
- The new zero-rate loan will make it possible to finance up to 40% of the property project, compared with 18% and 26% at present.
- The new measures also make it possible to extend the term of the PTZ to a minimum of 20 years in order to reduce the monthly repayments.
- You can defer repayment for a minimum of 5 years and up to 15 years, compared with 0 to 14 years at present.
- Lastly, the possibility of benefiting from a zero-rate loan for the purchase of an existing property has been extended to cover the whole of France, with a minimum of 25% of the total cost of the transaction requiring work. At present, this scheme is only available to 6,000 rural communities. Facilitating eligibility for the PTZ for existing properties should have an immediate impact on activity and therefore employment. This measure shows that the government is no longer obsessed with a recovery focused exclusively on the new-build sector.
According to the government, all of these measures should lead to the creation of at least 50,000 jobs, with the economic impact on public finances expected to be felt from 2017 onwards. Funding for these measures to boost the PTZ will have to be provided for in the 2017 Finance Bill. The government estimates that 120,000 zero-rate loans will be granted each year.
The purchasing power of low-income households will improve thanks to these new provisions, which will make it easier for them to buy their own home. As banks are currently very careful about the quality of borrowers' applications, this state aid will often be a decisive factor in obtaining a loan.
