Spain, September 22, 2023.
Rates will begin to fall in the middle of next year but the reduction in mortgages will take even longer
The recent decision of the European Central Bank to raise interest rates by another quarter of a point to 4.5% has been a new stimulus for the Euribor, which this week has reached figures not seen since the 2008 financial crisis and seems to be on its way to 4.5%. After a quiet summer in which there was speculation that the ECB would momentarily pause its rate hike, recent inflationary pressures have forced the institution chaired by Christine Lagarde to tighten its monetary policy. Faced with this bleak panorama, which is now added the rise in oil prices, many mortgage holders are wondering when their monthly payment will stop increasing. From Euribor.com.es, its manager Carlos López warns: "Everything seems to indicate, as long as there is no "black swan", that Rates will begin to fall in Europe in the second half of next year, as Luis de Guindos has recently advanced, so probably by the end of the year the 12-month Euribor ceiling (the most used in mortgages in Spain) should be reached. ) to have a calm end of the year and a 2024 in which it begins to decline. as its monthly fee decreases until 2025 at the earliest." The economist CEO of FuturFinances.com and analyst of https://www.euribor.com.es, based on the current Euribor forecasts, has simulated an amortization table for a mortgage of 180,000 euros in September 2022, with a term of 25 years and a variable rate of Euribor 1%. This mortgage cost 785 euros per month at the beginning. Considering annual reviews, at the end of 2023 monthly payments of more than 1,000 euros were already being paid, a situation that will continue in 2024 despite the fact that we estimate that the Euribor drops to 3.75% in the final stretch of 2024. Thus the monthly payment for 2023 would be of 1,049 euros and that of 2024 of 1,018 euros. It would not be until September 2025 that one could expect to pay less than 1,000 euros in mortgage bill.
Contact Contact name: Carlos López Contact description: Euribor.com.es Contact phone: 666625624