OAT at 3.5%, the painful awakening of French real estate 

At 3.54, the 10-year OAT rate has reached its highest level since 2011. This critical threshold, which is a far cry from the 3% hoped for by market participants, reflects investors’ loss of confidence in France’s fiscal policy stance. This situation threatens the fragile recovery of the property market, which had at least shown signs of improvement in the first half of 2025. 

As Arnaud Syoën explains:  

“France is dangerously close to the red zone: from a gap of 100 basis points with Germany, a self-reinforcing spiral can be set in motion. Investors become more demanding, auctions become more dispersed and financing conditions tighten. 

The expert from Eight Advisory points out that the fundamental data – persistent deficit, political instability, downgraded ratings – point to a structural rise in interest rates to 3.8 to 4 % within six months. Against this backdrop, real estate investors will have to choose between anticipation and a wait-and-see approach as the cost of capital tightens and rental demand normalises. 

The article concludes with a strategic question: does France still have the means to continue its economic policy? The institutions are still sound, but only decisive political action can break the vicious circle of mistrust. For the property sector, the question is no longer whether interest rates will rise, but by how much and how fast. 

Read the full version of this article (in French) published by CF News Immo on 19 September 2025