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Fixed-rate mortgages beat another record: they are already 28.3% of new contracts

The mortgage loan firm to buy housing recovers and rises 6.4% in August

After the drastic fall of 14.9% in the number of mortgages signed in July. As a consequence of a judgment against abusive clauses that forced the Property Registries to suspend the registration of some of these loans, the market recovers normality. In August, financial institutions granted 20,609 mortgages to purchase a home, 6.4% more than in the same month of the previous year. According to data released Thursday by the National Institute of Statistics (INE). With respect to July, they rose 10.2%. “The data from August show that the granting of housing loans, despite the seasonality of the month and the legal issues that limited their enrollment in July, continues to grow at a practically stable pace,” according to Fernando Encinar, head of Idealist studies.

Apart from judicial bumps, experts are convinced that credit will continue to flow. Because the bank has an interest in granting mortgages. Above all, fixed rates. In 2006, before the bubble burst, only 2.48% of the new loans for housing were fixed. The statistics of the INE returns to pick up a new record in the contracting of fixed-rate mortgages, which already account for 28.3% of the contracts. Loans using a variable interest rate fall to 71.7% from rates in excess of 90% in the boom years.

Precisely the greater contracting of products at fixed rate has led to an increase in mortgages. The average interest rate, at the beginning, for credits on housing is 3.26%. 0.2% higher than in August 2015.

The unprecedented rise of these products, which ensure the monthly payment without variations throughout the life of the loan and shield the mortgaged. It occurs as the Euribor accumulates eight consecutive months in negative and continues to lower variable mortgages. After a slight rebound in August and after the European Central Bank (ECB) decided to keep the price of money at 0%, the index has fallen again. And it has deepened in its lower levels of the history, when standing in the -0,057%. Some experts warn that the Euribor could experience a change of trend in a couple of years. “If the euríbor repeated an evolution similar to the one registered since its creation, a fixed mortgage could be up to 49.86% more expensive”, according to the calculations of Kelisto.es.

However, the fact that almost one out of every three operations is fixed at fixed rates and that financed amounts maintain a moderate growth line, show that the point at which we go will have nothing to do with the excesses of the bubble, Need Encinar.
110,121 euro mortgage

Regardless of the type, the contracting of mortgages accumulates in the first eight months of the year a rebound of 13%. With increases of 16.9% in borrowed capital and 3.5% in the average amount. The statistic highlights how the average amount of loans for home purchase continues to increase. In August, the average amount loaned was 110,121 euros, representing an increase of 4.8% year-on-year. Total borrowed capital also increased by 11.5% to € 2,269.5 million.

The regions where most buyers have mortgaged have been Andalusia (3,842), Catalonia (3,496) and Community of Madrid (3,148). They are the same ones that provide more capital for the mortgage firm: Community of Madrid (512.8 million euros), Catalonia (434.5 million) and Andalusia (359 million). In Asturias, Castilla y León, Valencian Community, Basque Country and Galicia, the volume of contracted mortgage products falls, especially in Galicia where the decrease is 26% year-on-year.
The country
Sandra López Latvian
27 OCT 2016

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