MORTGAGE NEWS: Euribor down in March as lending accelerates in January

spanish mortgage euribor march 2017

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.

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