The president of the European Central Bank, Christine Lagarde, announced this Thursday, for the ninth time in the last year, a new rate hike, in this case of a fourth point, reaching 4.25%. With these increases, which will be obtained in July 2022, the ECB seeks to achieve inflation below 2%. Its most immediate effect has been an unprecedented rise in the Euribor, the index to which most variable-rate mortgages are referenced, which moves around 4.10%. The rise in the indicator has not only made variable-rate loans more expensive, but also fixed-rate mortgages, although loans can still be found below the Euribor.
After a year announcing monetary restrictions, Lagarde left the door open at the ECB press conference, to the possibility that this published rate hike will be the last. Even so, this new increase puts mortgage loans on the ropes again. Last Tuesday the Euribor stood at 4.159%, the highest figure since November 2008, when the indicator marked 4.35%, and everything indicates that next Monday it will grow again. Although it is unlikely that it will reach 5%, which was one of the great fears that they had.
Mortgages below 3% at a fixed rate
Still, there are a number of fixed-rate mortgages that are below the benchmark. This has meant that, according to Kelisto, the average interest in the month of July for this type will stand at 3,464%. However, some entities offer a lower mortgage price. For example, the bank offer with the lowest interest in the market is that of BBVA, which offers 2.8% at 30 years, followed by that of Cajamar with 2.99%. The first requires only two linked products, life and home insurance, while the second does establish that it is tougher, with six products.
Mortgages below 4% at a fixed rate
Above the 3% barrier, but cheaper than the Euribor, are: Openbank with 3.07%, although with conditions that force direct deposit of payroll and purchase home and life insurance with the bank; Unicaja Banco at 3.25%; Evo Banco y Caja Ingenieros at 3.35%, the entity’s interest is subject to domiciling the payroll and taking out home insurance.
Bankinter rises compared to yesterday to 3.5%, but it is necessary to open an account, and take out insurance or open a pension plan; MyInvestor at 3.69%, and Caixabank at 3.85%, being able to request up to 80% of the value of the guarantee, the lower of the appraisal value or the value of the sale of the home, as long as it is of the habitual residence.
Despite these prices, the uncertainty of the mortgage market continues to grow, causing the number of home sales to have fallen to 4% nationwide until May, while mortgages have plummeted 22% since the beginning of 2023.
“It is more and more frequent that the client asks for advice since, given the changes that have occurred in a few months, there is greater uncertainty in this regard and, above all, there are more doubts about what is best at a time like this and which mortgage should be chosen in the long run”, affirms Sergio Carbajal, head of the mortgage area at Rastreator. In addition, from this mortgage comparator they affirm that 35% of Spaniards would be willing to buy a house next year, but that these increases in the Euribor make them wait in case it goes down again.
