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The interest rate hike announced by the European Central Bank is already having an impact on bank lending rates, making real estate financing significantly more expensive.
Many people who expected 1.0 percent interest should now be scared, says construction financing expert Max Herbst. Now they would have to calculate about 3.0 percent interest with a loan to value of 60 percent.
In the short term, the consequence could be falling demand and thus a drop in prices on the real estate market. But “the dream of a house lives on,” says Herbst, which is why prices should continue to rise again in the medium term.
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While most savers are probably happy about rising interest rates, there are also losers from the turnaround in interest rates: people who are looking for a property and have to take out a loan to do so.
Because now the average interest rates are already three percent for a 60 percent loan. At the beginning of February, the interest rate for financing a real estate loan with a loan to value of 80 percent was still one percent, says construction financing expert Max Herbst from the financial consultancy FMH.
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