Euribor is heading to a new low and lower mortgages further

Two sessions to close the month of January, the euribor is heading towards a new low that it would reduce the variable rate mortgages referenced with this indicator again. Yesterday, he marked a level of -0,504%, lower than the minimum established in December (-0.496%). This Euribor value would represent a -0.251 points decrease compared to the one marked in January of last year, which will have a downward impact on variable mortgages linked to this indicator and which are revised with that of January. For an average mortgage of 125,000 euros at twenty years that will have an annual review this month, the mortgage will be affected in a decrease in the monthly payment by about 13 euros.

Although in April and May the Euribor rallied and seemed to be heading towards positive rates, from then on it went into a tailspin and began from September to beat one minimum after another dragged by the monetary policy of the ECB, which keeps rates very low to stimulate the economy and charges entities 0.5% for keeping their money.

Since the Euribor entered negative territory, banks recovered their fixed mortgages that they had put in a drawer and they put attractive interests to them to guarantee the income that they were losing with the bleeding of the Euribor. And the bet is winning. In November, mortgages with registration changes shot up 220%, reaching 14,058, according to the statistics published yesterday by the INE. Of this amount, 20.4% corresponded to changes in interest rates to go from variable to fixed. After the change in conditions, the percentage of fixed-rate mortgages increased from 18.6% to 34.7% and that of variable interest mortgages fell from 79.8% to 61.3%.

Mortgage signing

In the new mortgage signing It is also possible to see how fixed mortgages have gained ground and already dominate half the market when not long ago they barely reached 20%. In November, 47.4% of the new loans initialed were at a fixed rate and 53.8% variable. It is not, however, the highest level that these credits have registered. In March, just before the pandemic, they even exceeded variable mortgages with 51.5%.

In global terms, the number of mortgages constituted on dwellings registered in the property registers stood at 28,756 in November, 2.4% less than in the same month of 2019. Despite the decrease, since fotocasa.es consider that the 28,756 loans signed are a great record because it is the highest in the entire pandemic and it is the second consecutive month that the barrier of 28,000 signed mortgages has been exceeded. However, both from fotocasa and from idealista consider that the sector is not prepared to recover the levels of 2019 this year. Pisos.com He also warned that it will be necessary to see how the sector reacts to the third wave after having managed to overcome the second.