Real estate 2021: notable regional differences in contribution, loan and loan term

The past year was special in many ways. The real estate market has been turned upside down. Between the health restrictions which made acquisitions more difficult over a period of time, the rapid resumption of activity marked by the desire of the French to change their place of life and the medium-sized towns which have succeeded in attracting new profiles, the question arises today on the profile of those who have a purchase project.

At a time when the French are about to elect the Presidents of Regions, who are those who, in the French regions, are acquiring real estate? What are their incomes? What is the amount of their contribution and the average amount of the transaction? What are the regional disparities? provides a portrait of the real estate borrower in 2021 in France and in the region.

1) Average amount of loans: significant disparities between the territories

Ile-de-France, Corsica and Provence-Alpes-Côte-d’Azur are the regions with the highest average loan amount. An individual living in an IDF borrows on average € 298,187, a Corsican, € 251,984 and a PACA resident € 229,202. The rest of the ranking, however, fell immediately. In New Aquitaine, the amount of the loan is € 190,102, in Occitanie € 173,728 and in Bourgogne-Franche-Comté € 160,997. The gap is really widening between these regions.

The two major criteria for banks to study a file are: the borrower’s income and his personal contribution. The higher the salary and the contribution, the more the individual will be able to benefit from a high loan amount. The credit rate will also be more advantageous.

2) The amount of transactions: the big gap between regions

The amount of transactions per region reflects the price of stone but also the amount of income and the loan rate granted. The national average is € 223,148. Ile-de-France is 1.7 times higher than the latter, with an amount of € 359,865. It is the territory very much at the top of the ranking. The PACA is still above the national average, with a figure of € 281,073. On the other hand, the amount of transactions for the Bourgogne-Franche-Comté region is more than two times lower than the IDF, with an average of 176,613 €. Bourgogne-Franche-Comté is one of the regions with the cheapest real estate market in France. Housing prices are still very affordable, so it’s a good thing to be in this place, it means that property is more accessible there.

3) An increasing average loan period

In 2021, the average loan term is 21 years. At the end of 2020, she was around 19 years and a month. Since the start of the year, the trend has picked up again, as in 2019, when the average was 21 years and 6 months, the longest ever observed since we carried out this study. It is the massive demand from first-time buyers and the rise in prices in certain regions which is leading to a further increase in the average duration.

4) Borrower: strong income inequalities between regions

The income of the borrower in France can vary from single to double between regions. A region with strong economic and professional activity, sees the emergence of a more affluent population. The income of borrowers is therefore more important. However, the age of borrowers obviously also plays a role in the level of income, the older they are, the more naturally comfortable the income. As such, the PACA region is quite revealing.

In France, the three regions with the highest income are: Ile-de-France, Corsica and Provence-Alpes-Côte-d’Azur. The average incomes of borrowers are respectively € 6,017, € 5,639 and € 5,146.

It should also be kept in mind that, by extension, these three regions have a significant acquisition cost, for the average surfaces sought by households, the amount of the transaction will be higher than the national average. It is therefore normal to find there profiles of more affluent buyers.

5) How much personal contribution for which region?

The personal contribution that the borrower can provide when buying real estate inevitably goes with his income. Consequently, these are the same regions where we find: the borrower with the best income and de facto the borrower with the highest contribution. The Ile-de-France borrower contributes an average amount of € 58,105 and that of PACA an average amount of € 49,924. Indeed, in Ile-de-France it is even more complicated than elsewhere to borrow without contribution, because the prices are higher there, so without contribution the borrowable amount simply does not allow to buy a viable surface.

In addition, the regions which are in the middle of the ranking are: Pays-de-la-Loire (€ 31,155), New Aquitaine (€ 29,615). Finally, the region at the back of the pack (but therefore the most accessible) is Bourgogne-Franche-Comté with an average contribution of € 15,167.

6) The age of borrowers slightly increasing

The average age of the mortgage borrower in 2021 is 37 years old. As a reminder in 2019, it was 36 years and one month, in 2018 36 years, in 2017 36 years and 9 months, in 2016 37 years and in 2015 37 years and 6 months.

However, this age differs depending on the region. In 2021, it is in Provence-Alpes-Côte-d’Azur that it is most advanced. He is around 38 years and 5 months old. Only 18.6% of people in this region are under 30 and 37.1% are under 35. The share of first-time buyers is 56.37%. The real estate market in Provence-Alpes-Côte d’Azur is characterized by a large number of towns mainly located on the coast. Land pressure is strong there. It is particularly stimulated by the tourist attractiveness of the region and the acquisition of second homes. It then takes significant income and a significant contribution to be able to borrow and buy.

Regarding the breakdown by age groups of borrowers, the regions where borrowers under 30 are the most numerous are: Normandy (29.7%) and Grand Est (29.2%). For those under 35, we once again find the Grand Est (51.4%), followed by Hauts-de-France (50%) and Normandy (49%). Market prices are more accessible for younger people in these regions.

It is in the Grand Est (66.04%), Normandy (65.15%) and Burgundy-France-Comté (64.53%), that we find the largest share of first-time buyers. In Ile-de-France and Paca, the proportion of first-time buyers is lower, there is a significant share of rental investments or purchases of second homes, particularly in PACA.

Figures by region: