Renewal of an average variable mortgage takes place at the beginning of July. 250 Euro per month or what is the same 3,000 euros per year? Euribor, the benchmark index for most variable mortgages marketed in Spain, closed June at 4,007 percent, meaning increases of around 250 euros per month.
Thus, the index exceeded the 4% limit for the first time since 2008. Euribor continues to break records not seen since 2008, reaching 4.165 percent this Wednesday.
Interest rates set by the European Central Bank (ECB) are at 4% in the eurozone, so mortgages often start at this key rate. In the case of those already issued, those with fixed mortgages breathe a sigh of relief, while those with variable debt do not.
Therefore, it is understandable that many mortgage holders ask themselves when mortgages will drop. Head of Government Pedro Sánchez and Vice President for Economic Affairs Nadia Calviño, expand access to mortgage relief measures best practices collected in code Rents up to 37,800 Euros.
Calviño noted this Wednesday that this election promise, which will be one of the first measures to be adopted in a possible next legislature, is defined by the following reasons: economic situation better than expected and interest rates are rising more than expected.
Bankinter’s prediction
Led by María Dolores Dancausa, the bank has just updated its mortgage market forecasts and argues that Euribor will exceed 3% by 2025. Nearly 5% price drop between 2023 and 2024 and Euribor is closing over 4% this year.
The Savings Banks Foundation (Funcas) has calculated the annual average of Euribor for this year. 4.25% and 4% in 2024. BBVA Research believes it can reach 4.5%. The forecast is that the European Central Bank (ECB) will continue its current policy of raising interest rates up to twice this year, and therefore the cost of money will reach 4.5% at the end of the year, which will have an impact on housing loans.
Faced with this situation, many mortgages amortize some of their debts to banks and renegotiate the terms of the signed loans.
According to Bank of Spain data compiled by the Spanish Mortgage Association (AHE), more than 1,300 million renegotiations took place between January and April, three times that of last year. In the first five months of the year, the amount of depreciation reached 8 billion 326 million euros.