The immovable he’s not having his best time. After years of rising prices, both in home buying and rent, before the pandemic, this trend seemed to be slowing down, but with Covid-19 it has come to a standstill. The year 2021 has started with uncertainty for the sector, not only because of the economic crisis linked to the health situation, but also because of regulatory changes in the rental market which, obviously, also affect landlords. In this context, different teams of analysts are planning corrections in the coming months. If you are considering owning a property, here are some of the reasons why it is worth doing so this year.
Increase in opportunities
No matter how saturated the market is, if you are patient, it is always possible to find a buying opportunity. The truth is that in times of economic crisis, these opportunities multiply. If you are careful, there is a good chance that you will be able to acquire a house at a reduced price in the next few months.
Low interest rates
Massive debt purchases by central banks have a direct effect: lower interest rates. In 2016, the Euribor it traded negative for the first time, and since then it has been steadily declining. It is true that this week started with a slight rebound in its daily rate, but despite this, the one-year Euribor continues to sit at -0.5%, its lowest level in history. Buying a home often requires external financing and these levels make the interest rates at which loans are granted more attractive than ever.
Attractive mortgages
Fixed or variable mortgage? Both options, according to Finect, have their pros and cons. “The key to choosing between a fixed or variable rate home loan is how each one works, the economic outlook and the buyer’s personal situation,” they explain from the platform. Either way, if interest rates are low, so are mortgages. Its average interest rate, according to the Bank of Spain, stood at 1.56% in January (latest data available), the lowest in the entire historical series. Among the most notable 30-year unrelated fixed rate market offers, Evo Banco stands out with an APR of 1.75%, which can reach 1.55% if home insurance is taken out and payroll is registered. Similarly, Openbank offers an APR of 2.01%, while if the same products are purchased as in Evo Banco (payroll and home insurance), it drops to 1.86%. For its part, the Sin Mochila mortgage, from Anbank’s neobank, My Investor, amounts to 1.88% APR at 25 years, the maximum number of years that can be contracted.
Fixed rate or variable rate mortgage?
Get ahead of your competition
The Covid It has changed the life of society and among the changes it has brought about are preferences for the type of housing. El confinamiento ha hecho valorar más los espacios abiertos, las terrazas o zonas ajardinadas, las estancias más amplias, las grandes ventanas exteriores… Sin olvidar que el teletrabajo requires introducing the oficina en casa y que, por lo tanto, también precisa de una zona dedicada to her. Many people are looking for a home that meets these new needs or are planning to do so soon, so moving forward before the supply runs out is always a good option.
Price drop
The analysis team of OCU Farms and Houses consider that the data on employment and its relation to the ability of Spanish households to generate stable incomes will logically have an impact on house prices. Thus, experts expect further price cuts as the economic effects of the crisis become more visible. “We are on the way to a sharp drop in prices. Prices are slowly falling, but the bottom is not visible and with the poor economic outlook, we fear that this bottom will not arrive in 2021, but in 2022 or even beyond ”, they say. So far, in his opinion, the Spaniards’ propensity to buy remains strong, which means the declines have not been as large as might be expected. “The effects of the crisis will be perceptible in a delayed manner”, they condemn.
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