Is the Golden Age of Real Estate Brokerage Coming to an End?

High interest rates and a decline in mortgage applications marked the end of a prosperous period for brokers, according to the annual report by Orias (the Agency for the Single Registry of Insurance, Banking, and Financial Intermediaries) published on September 16. 
 

The number of banking service intermediaries has fallen significantly.
Specifically, the number of brokers in banking and payment services—who are required to register annually—decreased by 9.6% year-over-year, reaching 6,294 as of December 31, 2023. This decline is attributed to “economic conditions,” according to the president of Orias during a press conference.
 

The economic landscape has indeed changed for these intermediaries, following a period of prosperity fueled by low interest rates. The European Central Bank (ECB) began raising its key interest rates in the summer of 2022, a move that banks—concerned about their profit margins—immediately passed on to their customers.
 

Prospective borrowers have realized that an additional percentage point on their loan could increase the cost of a loan by tens of thousands of euros over a 20- to 25-year period. Many of them have therefore decided to postpone their purchase plans, hoping that sale prices will eventually fall, which has dried up the brokerage market. A reform of the brokerage industry—which, among other things, requires insurance, banking, and financial intermediaries to join a professional association—also partly explains this decline.
 

Beware of scams
Orias, a nonprofit organization under the 1901 law and overseen by the Ministry of the Economy, maintains the industry registry by registering new entrants and removing those who cease operations. The updated list allows consumers to verify that they are dealing with a licensed broker, as scam attempts are “commonplace.”
 

In early September, the ACPR (Prudential Supervision and Resolution Authority) warned the general public about the rise in fraudulent mortgage and debt consolidation offers made by individuals impersonating brokers and lending institutions.

Rising interest rates have also reignited competition among savings products and spurred the growth of the financial investment advisory sector, with 6,710 registrations—a 5.5% increase.
 

The total number of registrations across the various subcategories of insurance, banking, and finance agents stands at 116,938 (-2.4%), with 69,277 registered intermediaries; professionals often hold multiple registrations.