Spanish banks grant the cheapest second mortgages in Europe. According to the latest data offered by the European Central Bank (ECB), at the end of October, the average interest rate at which loans were signed fell to 3.2%, which is the lowest figure since January 2023. Likewise , it is the second country in the European Union, only behind Malta, to offer the lowest prices. The average interest rate in the euro zone for mortgage loans is 3.5%. In neighboring countries such as Italy and France (3.27%), rates are also lower, although they are higher than those in Spain. And in Germany (3.65%) and the Netherlands (3.73%) the price is noticeably higher. The banks that set the highest interest rates are those in Estonia, with an average of 4.97%, Latvia (4.86%) and Lithuania (4.76%). To give an idea, in Spain, with this average rate of 3.2%, in a 30-year mortgage to acquire a property of 300,000 euros and in which the person contributes 30% (about 90,000 euros) that means paying 128,000 euros in interest in total throughout the period. Taking the same example as a reference, but with the average rate of the eurozone, the total interest would amount to 142,000 euros.
In July 2022, the ECB began, after six years with historically low interest rates, a path of rate hikes that took the price of money from 0% to 4.5% in just a year and a half. , which made loans and mortgages more expensive. In July 2022, the average interest rate at which mortgages were signed was 1.8% and from there it escalated until reaching a maximum of 3.94% in October 2023. Since then, and with the market anticipating a progressive reduction in rates once inflation was controlled, prices began to fall until reaching the aforementioned 3.25% in September. And it is foreseeable that the data for the coming months will be even lower and will soon reach below 2% for the first time in two years.
Anticipating these cuts, the Euribor is below 2.5%, a rate drop that allows entities to make better offers at fixed interest, which are the vast majority of those granted today. There has not yet been a mortgage war between entities, but fixed and mixed loans can already be found below 3%. “Although September was not an excellent month, you could already find fixed-rate mortgages below 3% and mixed rates below 2%, which encouraged many consumers to opt for these modalities,” explained from RN Your Mortgage Solution. . In the current banking showcase, Santander offers fixed mortgages at 3.22% APR, Openbank at 3.27% or Bankinter at 3.57%. In mixed mortgages, prices drop to 2.4% from Ibercaja, 2.5% from Abanca, 2.66% from Openbank or 2.75% from ING and Santander for fixed tranches. In addition, it must be taken into account that the offers that the entities publish are later personalized to each client, depending on their profile.
In July 2022, the ECB began, after six years with historically low interest rates, a path of rate hikes that took the price of money from 0% to 4.5% in just a year and a half. , which made loans and mortgages more expensive. In July 2022, the average interest rate at which mortgages were signed was 1.8% and from there it escalated until reaching a maximum of 3.94% in October 2023. Since then, and with the market anticipating a progressive reduction in rates once inflation was controlled, prices began to fall until reaching the aforementioned 3.25% in September. And it is foreseeable that the data for the coming months will be even lower and will soon reach below 2% for the first time in two years.
Anticipating these cuts, the Euribor is below 2.5%, a rate drop that allows entities to make better offers at fixed interest, which are the vast majority of those granted today. There has not yet been a mortgage war between entities, but fixed and mixed loans can already be found below 3%. “Although September was not an excellent month, you could already find fixed-rate mortgages below 3% and mixed rates below 2%, which encouraged many consumers to opt for these modalities,” explained from RN Your Mortgage Solution. . In the current banking showcase, Santander offers fixed mortgages at 3.22% APR, Openbank at 3.27% or Bankinter at 3.57%. In mixed mortgages, prices drop to 2.4% from Ibercaja, 2.5% from Abanca, 2.66% from Openbank or 2.75% from ING and Santander for fixed tranches. In addition, it must be taken into account that the offers that the entities publish are later personalized to each client, depending on their profile.
In that sense, experts assure that interest rates of around 2.5% can currently be achieved. It must also be taken into account that in the last months of the year the banks push to close operations. Financial and real estate entities have commercial objectives and seek to accelerate the signing to achieve or exceed them. In that sense, the client usually has more pressure to achieve a better price on the mortgage than at the beginning of the year, so it is in the interest of all parties to close ongoing operations. “The current real estate boom will mean that not only will there be cheaper variable rate mortgages due to this decrease in the Euribor, but we will also have much more competitive fixed rate mortgages, in some cases reaching below 2% or 2% fixed rate” , point out from Trioteca.
This December the deadline expires for clients who have a fixed mortgage to change it to a fixed or mixed rate without the cost of novation (which consists of agreeing on a new interest rate with the same bank) or subrogation (which involves taking the mortgage to another bank that offers a lower price). And experts advise changing, since although the Euribor continues to fall, it is a way to protect the loan with a lower interest rate and which is now even cheaper than variable mortgages.
According to data from the National Statistics Institute (INE), between January and August some 260,000 mortgages have been signed, of which 56% have been established at a fixed rate and 44% at a variable rate. After a few months in which the production of new loans had been contained due to high rates, a recovery is expected. “In the coming months, it is expected that the dynamism of the real estate sector will continue, although the sharp rise in prices, derived from the mismatch between supply and demand, puts the recovery at risk, especially in the most retired areas of the country. “, they point out from Ibercaja.