Mortgage Rates in May 2025

In May 2025, the French real estate market is evolving in a climate marked by the stabilization of average rates and a slight increase in the best rates, in the face of an uncertain international economic context. Real estate prices, for their part, have relatively stabilized, currently offering buyers and sellers opportunities to close deals.
In this context, it is advisable for prospective homebuyers to position themselves to borrow in May 2025 under still favorable conditions. In this article, Capifrance offers you an analysis of mortgage rates in May 2025, as well as practical advice for buyers and homeowners looking to sell.

Mortgage Rate Barometer – May 2025

In May 2025, the mortgage market shows not only a stabilization of average rates, which began last April, but also a slight increase in the best negotiated rates. After several months of decline, banks are now facing pressure from the financial markets.
In response to the new rise in France’s 10-year government bonds (OAT) and the disastrous effects on the markets caused by Donald Trump’s announcements regarding international customs duties, financial institutions are adjusting their rate scales.

The average mortgage rates offered in May 2025 are as follows:

(Source: Cafpi)

The best borrower profiles, with a substantial down payment and excellent repayment capacity, can still negotiate loan rates close to 2.85% over 15 years or 2.90% over 20 years to purchase a property.​
Opportunities still exist to obtain a negotiated rate below the symbolic 3% threshold for solid real estate projects. However, this window may close in the coming months if economic pressure persists.

Comparison with the Best Mortgage Rates in Previous Months

Since the end of 2024, the most competitive mortgage rates had been in continuous decline, which is no longer the case in May 2025. Relative stagnation is observed in average and long-term loan rates, but the best 10- and 15-year loan rates are rising again toward 3%, rather than continuing their decline toward 2.5%.

Analysis of the Recent Rate Trend

As inflation persists and tensions rise in the bond markets, banks have anticipated a slight increase in their refinancing costs, which may explain the upward adjustment of the best rates.
Recent drops in international financial markets and the panic sparked by Donald Trump’s announcements are prompting banks to exercise increased caution. The halt predicted the previous month is thus being confirmed.
However, despite this global economic instability, the ECB still lowered its key interest rate again to 2.25% at the end of April, and average rates remain stable, thanks to the positive trend in previous months and while waiting for more clarity in the markets.
Loan conditions therefore remain favorable for completing a real estate project in France, but one should not delay, given the risk of new increases in the coming months.

Also to read:

• ​Mortgage rates in April 2025​
• ​Mortgage rates in March 2025​

Mortgage Rate Forecasts for the Coming Months in 2025

In the short term, real estate credit experts forecast a certain instability in rates over the coming months, which could result in a general increase in rates—or at the very least, stagnation while waiting for favorable market signals.
Despite the ECB’s new rate cut in April 2025 (2.25%), the rise in 10-year OAT rates in France could lead to higher mortgage rates this summer. Banks, keen to preserve their margins in a suddenly strained economic environment this spring, may revise their pricing upward.

Forecast Scenario:

• Likely stabilization of average rates between 3% and 3.5% until September 2025

• Possible rise in the best rates to around 3% for 10-, 15-, and 20-year loans

• Clarification and potential new upward or downward trend in autumn 2025

Therefore, completing a real estate project in spring 2025 remains a smart strategy to take advantage of current conditions before the situation potentially worsens in the second half of the year.

Economic Context: Why Are Mortgage Rates Slightly Up in May 2025?

After several months of declining mortgage rates, May 2025 marks the turning point anticipated in April: while average rates remain stable, the best rates are rising again. This trend can be explained by a set of economic and geopolitical factors that strongly impact banks’ financing conditions.

Geopolitical and Economic Instability: An Uncertain Climate

Since the beginning of spring, the international economic climate has deteriorated due to:

• Donald Trump’s announcements regarding increases in international customs duties, which triggered major instability in global financial markets.

• The rise in France’s 10-year OAT rates, a key indicator for setting bank mortgage rates.

• Persisting inflation in the eurozone, which remains above the ECB's targets despite support measures.

In response to these tensions, lending institutions are gradually adjusting their pricing, notably by raising rates for the best profiles to offset increased refinancing risks.

New ECB Rate Cut: Moderate Impact on Mortgage Credit

To address this tense context, the European Central Bank (ECB) cut its key interest rates again. After March’s cut, a second reduction took place on April 23, 2025, bringing the main refinancing rate down to 2.25%. This decision aims to:

• Boost economic activity in a context of general slowdown

• Support access to credit for individuals and businesses

However, despite this accommodative and resilient policy, French banks remain cautious, due to market volatility and increased financing costs linked to 10-year OATs.
Result: the impact of the key rate cuts is, for now, limited on the mortgage rates offered to individuals. Nevertheless, this remains a positive signal in an otherwise unfavorable economic climate.

Why You Shouldn’t Wait to Finalize Your Real Estate Project in 2025

In this unstable context, it is advisable not to postpone your real estate project. Here’s why:

• Rates remain favorable, with financing opportunities around 3% for many profiles

• The French property market has largely stabilized, with more realistic prices, especially in the old housing sector

• The risk of a rate increase in the medium term is real, in the event of worsening global economic tensions

Lastly, if rates were to drop again in autumn 2025, it would still be possible to renegotiate your mortgage or refinance your loan.

Conclusion To secure your mortgage and fully seize the current buying opportunity, it’s best to move forward with your real estate project now—with the support of a Capifrance real estate advisor and our broker partners.

Also to read:

• ​What is the average rate of mortgage insurance in 2025?​
  
• ​Is 2025 the right time to buy your first property?​
  
• ​Buying a house with no down payment: is it possible in 2025?​
  
• ​What is the ideal down payment for a property purchase?​
  
• ​What are the notary fees for buying an old house?​

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Real Estate Prices in May 2025: Opportunities to Seize

In May 2025, the French real estate market shows encouraging signs for buyers. Price per square meter appears to be stabilizing across France, offering tangible buying opportunities. Despite a rebound in rates, many buyers can benefit from enhanced support schemes for property financing and homeownership, particularly the expanded Zero-Interest Loan (PTZ). Purchasing power in real estate remains solid due to stable prices.

Old Properties: Realistic Prices Favorable to Buying and Selling

The residential market for old properties in France is showing a trend toward price stabilization, although the evolution per square meter varies by region and municipality.
Prices for old housing are generally correcting toward levels more aligned with market realities.
This situation presents opportunities for both buyers and sellers. Buyers benefit from reasonable prices, while sellers can observe a rebound in demand.

New Properties: Financial Support and Energy Efficiency Advantages

The new housing market also offers opportunities, especially with the expansion of the PTZ since April 1, 2025. This scheme is now available throughout France, with no geographical zone distinctions, and applies to newly built single-family homes. This measure aims to stimulate homeownership and support the new build market. Benefiting from the PTZ thus helps significantly reduce monthly payments, despite the upward trend in rates this May 2025.
Additionally, new homes offer energy performance advantages, with strong EPC (DPE) ratings, reducing energy costs for owners. Furthermore, reduced notary fees and exemption from transfer duties in the case of a gift for a property purchase clearly increase the appeal of new builds.

In summary: despite the still-high prices of new properties, the financial support available and the energy benefits make new homes a top choice for buyers in 2025.

Advice for Buyers: Convert Your Real Estate Purchasing Power in May 2025

With a stabilized real estate market and still attractive borrowing rates, May 2025 represents a real window of opportunity for buyers. To maximize your real estate purchasing power, it is essential to optimize your financing and take advantage of the many available support schemes—especially during the 2025 tax filing period. Numerous real estate tax loopholes also make it possible to significantly reduce the overall cost of a purchase.
Thanks to a mortgage simulation conducted beforehand, it is easier to precisely define your budget and anticipate applicable banking conditions. Today, taking advantage of support measures and securing a competitive rate is a key lever for optimizing your real estate financing. Buyers who complete their project this spring will benefit both from favorable credit conditions and tax treatment adapted to recent purchases.

Optimizing Your Mortgage Loan: Tips and Strategies

To maximize your purchasing power, it is essential to present a solid borrower profile. Banks remain particularly sensitive to the debt-to-income ratio, which should not exceed 35% of net income to meet approval standards.
Another key point is the residual savings capacity: demonstrating that the borrower retains an ability to save after repaying the loan is a real advantage for securing a better rate.
Rate negotiation is also a powerful tool: by comparing offers from several institutions or working with a mortgage broker, it’s possible to obtain more favorable conditions. In May 2025, it is advisable to act quickly, as negotiation margins may shrink with an expected rise in rates this summer.

Taxation and Tax Declaration: How to Take Advantage of Real Estate Tax Breaks

As every year in France, May is also the ideal time to optimize your real estate taxation. With the 2025 tax declaration underway, buyers can highlight certain real estate investments and benefit from attractive tax breaks related to property purchases. It is possible to claim significant and cumulative tax reductions of up to €10,000 per year.

Advice for Property Owners Looking to Sell: Sell Rather Than Wait!

If you are a property owner considering selling your home, May 2025 is a key moment to move forward with your project.
The current market is relatively balanced: buyers enjoy renewed purchasing power, supported by stable loan rates and enhanced support schemes such as the 2025 PTZ (zero-interest loan). This momentum strengthens demand in the existing property market, where prices have become more realistic and aligned with the purchasing power of the French population. Buyers are ready and looking to purchase your property.
Delaying a sale could be risky: a possible increase in interest rates this summer would mechanically reduce the borrowing capacity of future buyers, making transactions more difficult. Conversely, selling now allows you to take advantage of a still-active market with present and solvent buyers.
Entrusting your project to a Capifrance property advisor, an expert in the local market, allows you to benefit from a precise valuation and a selling strategy tailored to current market conditions.

Your Capifrance Advisor Supports You in Your Real Estate Projects

In a complex market, being supported by a Capifrance real estate advisor is a real asset to secure your buying or selling project.
Thanks to their in-depth knowledge of local markets, Capifrance advisors offer you professional and personalized support tailored to your specific needs.
Whether you are looking for the ideal property, need a reliable valuation to sell quickly, or want tailor-made financing with the help of a broker, Capifrance offers complete support to help you succeed in your project.

Conclusion

In May 2025, real estate market conditions remain favorable despite an uncertain economic context. French mortgage rates remain attractive : prices have stabilized, and numerous support schemes continue to boost buyers’ purchasing power. After a decline in recent months, the downward trend in rates has now paused, with the best rates beginning to rise slightly, which is why it’s advisable to act promptly.
Key takeaways :

• Average interest rates remain around 3% for most loan terms.

• Real estate purchasing power is supported by the PTZ and realistic square meter prices.

• A stabilized market presents interesting opportunities for both buyers and sellers.

• An interest rate hike is possible in the coming months : act quickly.

• Having a Capifrance advisor by your side optimizes every stage of your real estate project.

To carry out your real estate project with peace of mind and seize the best local opportunities, contact a Capifrance property advisor today !

FAQ: Frequently Asked Questions About Mortgage Rates

Why are mortgage rates slightly rising in May 2025?

The international economic context remains uncertain despite the recent ECB rate cut. After a downward trend since 2024 and in response to a rise in 10-year OATs, banks must exercise more caution, resulting in a stagnation or slight increase in mortgage rates in May 2025.

Can I still get a mortgage under 3% in May 2025?

Yes, for the best borrower profiles, it is still possible to get a loan at under 3%. Make sure your financing file is strong to take advantage, but don’t wait too long—loan rates are slightly rising in May 2025.

How are property prices evolving in May 2025?

Property prices in May 2025 are characterized by stability in the existing home market and high prices in the new-build sector, offset by advantageous financial aids such as the 2025 PTZ and exemptions from transfer duties in the case of a donation.

Should I buy a property in May 2025 or wait?

Given the signs of stagnant average rates and rising best rates in May 2025, it is better to act now to benefit from the current favorable conditions, as the international economic and geopolitical context remains uncertain.

How can Capifrance help me with my real estate project?

Whether you are a buyer or a property seller, your Capifrance advisor offers personalized support and in-depth knowledge of the local market to help you succeed in your real estate project. You can also get the best financing conditions through our broker partners.

Author:

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Frédéric REMY, Director of Network Development at Capifrance

“As a real estate professional with several years of experience at Capifrance, I’m here to share key advice to help you succeed in your property project with the support of our advisors.”