Mortgage base rates in the Eurozone fell to another record low in March, whilst the latest data shows new mortgage lending in Spain accelerated in January.
12-month Euribor – the rate used to calculate most mortgage repayments in Spain – came in at -0.11 in March, down from -0.106 in February, and the thirteenth consecutive month of negative Euribor interest rates.
As a result, borrowers in Spain with an annually resetting Spanish mortgage will see their mortgage payments fall by around €5 per month for a typical €120,000 loan with a 20 year term.
NEW MORTGAGE LENDING RISES IN JANUARY 2017
The latest data from the National Institute of Statistics reveals that new mortgage lending rose 17% in January (yoy) to 27,240 new loans. Mortgage lending has risen for six consecutive months, often by double digits.
The average residential loan value also rose in January, up by 6.4% to €112,884. The average interest rate was 3.14%, down from 3.27% last year, and 37% of new loans had a fixed interest rate (with an average interest rate of 3.19%, compared to 3.12% for variable rates).
If the difference between fixed rates and variable rates is now just seven basis points, you have to wonder why anyone opts for a variable rate.