Home loan levels to fall across France

Business is expected to be slow this year for French mortgage lenders in the face of an ailing economy according to those in the know.

French property owners are likely to see house prices stagnate or even depreciate in the months ahead as the economy struggles to gain momentum amid political change and as the Eurozone crisis continues.

Research suggests that French property prices could fall by up to 15 per cent over the next two years and that the mortgage industry could suffer losses totalling upwards of 20 per cent.

Experts are not predicting a housing crash the like of which has hit other European nations as French mortgage lenders have had a more responsible attitude to household debt levels, but homeowners are expected to become more conservative in their household expenditure.

In the last couple of years French banks have seen good growth in the mortgage sector but that is now expected to diminish.