Exploring the Impact of Decreasing Mortgage Payments in May
In April, we witnessed a significant shift in the trend of rising mortgage payments. After nearly two years of continuous increases, those with variable-rate mortgages and annual reviews were able to reduce their monthly expenses by a few euros.
Experts suggest that there is a noticeable change in direction that will become even more apparent when the European Central Bank (ECB) reveals its monetary policy and begins to lower interest rates, expected in June.
Variable mortgage payments are calculated based on the outstanding capital and an interest rate composed of two variables: a reference index, typically the euribor, which fluctuates, and a fixed differential agreed upon with the bank.
Therefore, it is crucial to monitor fluctuations in the most commonly used index for mortgage referencing, especially during review periods (annual or semi-annual).
The Decrease in Mortgage Payments in May
Whether the review is semi-annual or annual, those revising their mortgages now will start to see changes in their payments. For semi-annual reviews, a decrease was observed last month, and this trend is expected to continue.
As for annual reviews, payments will decrease for these homeowners for the first time since 2021, providing relief after three consecutive years of increases.
For example, for a typical mortgage of €150,000 to be repaid over 25 years, with an interest rate of euribor plus 1% and an annual review, payments will decrease from nearly €856 to just over €851: a reduction of almost five euros per month and around €55 per year.
It is evident that the decrease in mortgage payments in May will have a positive impact on homeowners, offering some financial relief and potentially stimulating economic growth in the housing market.
En mayo, las cuotas de las hipotecas para los hipotecados con revisión anual bajarán por primera vez desde 2021. Esto se debe a la tendencia a la baja del Euribor, que es el índice de referencia utilizado para calcular las cuotas de las hipotecas variables. Se espera que esta tendencia continúe, especialmente cuando el Banco Central Europeo comience a rebajar los tipos de interés en junio.
Para una hipoteca media de 150.000 euros a devolver en 25 años, con un interés de Euribor más 1% y revisión anual, las cuotas bajarán de casi 856 a poco más de 851 euros, lo que significa un ahorro de casi cinco euros al mes y unos 55 euros al año. Esta noticia es un respiro para los hipotecados que han experimentado subidas consecutivas en los últimos años.
