October became the second most successful month in the history of Fincentrum Hypoindex with the volume of provided mortgages amounting to 25.214 billion crowns. Compared to September, the volume of provided mortgages increased by CZK 3.162 billion and even by almost CZK 8.3 billion year-on-year.
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The Moneta group, for example, confirms that interest in new mortgages is growing extremely. “In the last two months, it has increased by 450 percent year-on-year,” said its spokeswoman Zuzana Filipová.
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The interest in mortgages is also confirmed by a survey by the Czech Banking Association (CBA). According to him, a mortgage is mainly a way for the Czechs to own their own home, and more than a fifth of them currently have it. “Almost 90 percent of Czechs declared that the situation around coronavirus did not affect their housing in any way. Only 6 percent said that enough income was lost to cover housing expenses, such as loan repayments, “said CBA spokeswoman Andrea Trudičová.
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This October has become the second most successful month in the history of Fincentrum Hypoindex. “Banks provided a higher volume in a single month only in November 2016, when people, out of fear of a new law on consumer credit, arranged mortgages worth 29.683 billion crowns,” said Jiří Sýkora, Fincentrum & Swiss Life Select’s specialist in product management.
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According to the Fincentrum Hypoindex indicator, the average mortgage interest rate has been falling for the seventh month in a row. In October, it approached the 2% mark by another five basis points and ended at 2.02 percent. “Last time, the average mortgage interest rate was below two percent in March 2017,” said Jiří Sýkora of Fincentrum & Swiss Life Select.
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The average loan amount continues to rise, setting a new record of CZK 2,865,189 in October.
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In the first ten months of the year, banks provided mortgages for as little as 197.59 billion crowns. Compared to the record year of 2017, this year’s volume of provided mortgages is almost 11.4 billion crowns higher. Year-on-year, the volume even increased by more than 52 billion crowns.
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The end of the credit moratorium has not yet been signed on mortgage rates. During October, the ČSOB Group, Air Bank, Fio banka, Raiffeisenbank and Česká spořitelna reduced mortgages. At the beginning of November, Creditas Bank joined them. Rates above two percent for five-year fixations are only offered by large banks – Česká spořitelna, ČSOB, Komerční banka or Raiffeisenbank.
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“Due to strong competition and the persistently low price of resources, mortgage interest rates may not rise in the coming months. On the other hand, the low price of resources encourages a further slight decline in mortgage rates. The average interest rate on mortgages could thus look below two percent in November, “says Jiří Sýkora.
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