Rising Construction Loan Interest Rates and Implications for Property Buyers

München Anyone who takes out a construction loan today pays interest that is a good three and a half times as high as before spring 2022. “Another increase, albeit a slight one, is more likely due to the ECB’s announcements,” says Günther Vornholz, who works at EBZ Business in Bochum School real estate economics teaches.

The fact that loans with ten-year fixed interest rates have become more expensive so quickly within ten months is unprecedented. The jumps in interest rates in the 1990s, when the average building loan interest rose by two percentage points, seem like small jumps.

In the meantime, at least, it seemed that the rise in interest rates would be cushioned by falling house prices. Objects with a low energy efficiency class in particular became noticeably cheaper. But since many new construction projects have been stopped, the supply remains low, which, according to Immoscout24, stabilizes prices again. If you want to finance a property in this situation, you have to consider many things. The Handelsblatt helps to avoid the biggest mistakes in credit.