Fixed rates below 3% revive mortgage supply from Spanish banks

The Spanish mortgage market is trending towards improvement of available credit offers from the beginning of this year 2024. Confidence that the European Central Bank (ECB) will cut interest rates soon has sparked a wave of banks returning to offer loans at fixed rates of less than 3%.

While housing loan prices have been rising for most of the months of 2023, December two consecutive sales were combined into a chain average mortgage rate in Spain. YesAccording to the Spanish Mortgage Association (AHE), at the end of the year, interest paid on the loan on average they remained at 4.219%.which is below the general level in the eurozone.

This calculation includes both mortgages signed at a fixed rate and variable rates, which usually depend on evolution of the 12-month Euribor

, in addition to mixed modality, which has grown in popularity over the year. Base index for most mortgages in Spain was in 3.679% at the end of 2023under type of ECB intervention, at 4.5%.

Current offers on the market

And in the absence of confirmation in the coming days that the average mortgage rate continued to decline in early 2024.just look at the proposals of the main financial institutions to see that in recent weeks and, especially in early February, They have improved their prices. The five major banks made it clear during their results presentation that they were firmly committed to the mortgage market. looking forward to the loanThey are confident that demand will recover as soon as the ECB can cut interest rates, even if we have to wait until the summer.

However, if the organizations themselves continue to improve their offering and encourage possible mortgage warit is more than likely that demand will grow, again for fixed ones, to the detriment of mixed ones, which have gained popularity in recent months, as well as for variable ones, which

They may be interesting in some profiles. From clients. Entities such as Sabadell or Santander They offer fixed-rate mortgages as high as 2.60% and 2.77% respectively, subsidized by signing contracts for certain products such as home and life insurance, in addition to payroll.

In the case of a mixed mortgage, depending on the period for which the fixed rate applies, there may be loans such as Ibercaja at 1.75% for 5 years and Euribor plus 0.75 points thereafter, subject to peg. Very similar to Mixed Mortgage Unicajaat 1.60% for 5 years, and then Euribor plus bonus differential up to a maximum of 0.45%.

Fewer cash purchases

It is expected that in parallel with the improvement in the supply of mortgage lending Cash purchases of houses are declining. which, with rising interest rates, has increased significantly to such an extent that almost 44% of nearly 630,000 homes Sold in 2023, purchased without bank financing.

Despite this, experts warn about the diversity of buyers that at the same time comes with wide catalog of mortgage loansfrom loans for youth, a product intended in most cases for people under 35 years of age, for example, mortgages for non-residents, green mortgages, for a second home or investment, loans for self-promotion, for renovations, refinancing and even reverse. Reverse mortgages are one of the least common loans among Spanish businesses, although Santander has chosen it along with Mapfre. Typically, access to this type of mortgage is available to people over 65 years of age.