2023-11-25 09:01:33
The current economic and financial scenario has generated significant challenges for those who have mortgagesespecially due to the sustained increase in interest rates for those with a variable rate.
It is constant increase has led to a significant increase in monthly paymentsaffecting those who expect a change in the trend that, at least until the end of this year, seems not going to materialize.
According to the panel Funcasthe expectation of a decrease in fees could become a reality starting in January of the year 2024 for whom it is They adjust their mortgages twice a year. However, those who conduct annual reviews may not see benefits, according to forecasts, until April.
Rise in mortgages
The main protagonist of this increase in mortgages in the last two years is the euribor, the benchmark index for most variable mortgage loans. From December 2021, when it was in negative territory, until November of this year 2023, has exceeded 4%, implying an increase of more than 4 percentage points.
This increase in the Euribor responds to a series of multifaceted factors, among which the following stand out:
Inflation: The euro zone has experienced historical inflation levelswhich has directly impacted costs and the economy in general.
War between Ukraine and Russia: The state of war has generated greater economic uncertainty and financial at a global level, affecting markets and investor confidence.
Increase in interest rates: He European Central Bank (ECB) has begun a process of increasing rates for contain inflation and maintain financial stability.
The direct impact of this increase in the Euribor translates into an increase in the prices of variable rate mortgages. For example, for an average mortgage of 150,000 euros over 30 years, an increase in the Euribor by 0.5% translates into an increase of around 30 euros in the monthly payment.
In addition to the increase in the Euribor, other factors have contributed to the rise in mortgages, such as:
Increased cost of living: Rising prices have reduced household purchasing power, generating additional financial pressure.
Increase in housing prices: The rise in housing prices has made it difficult for some families to purchase a home, impacting supply and demand in the real estate market.
This increase in mortgages is having a significant impact on familieswho are being forced to face higher monthly payments and in some cases, unaffordable. Given this scenario, it is essential that those who have mortgages are prepared for possible changes in April 2024 and consider financial strategies to face this situation.
The uncertainty andglobal economy and the evolution of interest rates They remain key elements that will require careful financial management in the coming months. In this context, it is recommended that mortgage holders seek professional financial advice to evaluate their options, consider the possibility of renegotiating conditions with their banking entities and develop long-term savings and financial planning strategies. Prudence and adaptability will be essential to navigate economic challenges and protect household financial stability.
ECB notice
Christine Lagarde, president of the European Central Bankhas stated that the BCE “is getting closer to the objective” of achieving a 2% inflation. Although Lagarde has indicated progress towards this goal, his position was not definitive regarding the speculation about a pause in interest rate increases after Septemberand. In his words: “There will perhaps be a further increase in guideline rates, or perhaps a pause«.
#ECB #issues #important #warning #mortgages