Not very long ago it seemed as mortgages would continually decline and we would pay peanuts for it. Banks competed in who would offer the best deal and the most convenient loan with the lowest interest rate. However as it now seems, this sale competition is ceasing, at least for some time. Mortgage interest rate has increased for the first time since the beginning of the year.
Mortgage interest were falling in the long term
Who follows moves of the interest rate of mortgage from the beginning of the year, one could not believe. Interest rate was falling for a long time. When it hit 3 % border it started to attack 2 % borderline. Variable interest rates even crossed this line.
Banks offered more and more convenient conditions and customers got interested. Number of contracted mortgages rose and the banks could chafe hands. In July 2013 this trend ceased. After many months the mortgage interest rate rose again. Further development is not very clear yet.
It is a question of offers that banks will make in autumn and whether they will fight over the number of clients or the financial benefit from one client.
The interest rate back at 3 %
Currently, the interest rate of a mortgage that covers 70 % of the property is around 3, 06 %. For the previous two months it had not crossed the 3 % line. Average interest rate of a mortgage that covers 100 % of property is 4, 33 %.
It seems as the interest rate had hit bottom in the last month. According to experts steep rise to previous 4, 15 % (August 2010) is not very likely. It is more of a fluctuation. On the current market there should be room for another sale. Thus it is a question of a strategy that banks will choose and what interest rates they will offer in autumn.
