The mortgage market has been characterized in 2024 by gradually lowering the mortgage pricespressured by a Euribor, a reference index in the mortgage loans in Spain, which started the year at 3.6%, compared to the 2.69% it registered in the month of October. In this way, after chaining annual minimums since July, many interested in buy a house and request a mortgage from the bank, they wonder if mortgage offers are going to continue to decline, encouraged by further falls in the Euribor or, on the contrary, if mortgage loans are going to remain around current levels.
Are mortgages going to continue lowering?
From the mortgage comparator iAhorro they point out that for the remainder of the year mortgages will no longer register many changes, “the entities would no longer have time to sign these new loans in 2024 and they would move to 2025,” explains expert Laura Martínez. “The normal thing is that these discounts are made in September and October and are in force in the last quarter of the year to achieve the objectives set by the entities,” he adds.
However, from Rastreator Sergio Carbajal, a mortgage expert, indicates that mortgage offers still have some margin, particularly for mixed rate loans as a result of the attempt by banking entities to activate the market to attract new mortgagees.
Even so, Carbajal points out that this is an optimal moment for those interested in ask for a mortgageto which Martínez also adds, “the banks have already put all their effort into the bargain and the truth is that we are already at very good rates to finance ourselves,” points out the iAhorro spokesperson.
Looking ahead to the first quarter of 2025, although many changes do not usually occur in January, as explained by iAhorro, at the end of the month and in February there could be movement in the mortgage loans according to the trail left by the interest rates of the European Central Bank (ECB) and the Euribor. “If this trend continues, everything indicates that there will also continue to be certain declines that we will be able to see in the first quarter of next year,” explains Rastreator expert, Sergio Carbajal.
How far can mortgage prices be cut?
Therefore, mortgage interest can reach up to 2% in the fixed rate; in the mixed modalityup to 1.5% in the fixed period and with a Euribor plus 0.45% in the variable rate years; and finally, the variable mortgages They are expected to remain around the Euribor plus 0.6%.
Mixed mortgages will gain prominence in 2025
The protagonists of these loans will be the mixed mortgageswhich, although its hiring has already been reduced compared to the fixed rate offers, which have begun to be somewhat more attractive with the fall of the Euriborthe cycle of high interest rates has given prominence to these loans. Specifically, mixed mortgages offer a fixed rate for a few initial years, independent of the fluctuation of the reference index, and a later variable rate, which makes these offers cheaper. Therefore, although the security provided by the fixed rate causes them to be the favorites of the mortgagedthe mixed rate has gained relevance in the market that can be seen even more in 2025.
“The mixed modality will become more relevant in the market over the next year due to the focus that entities will put on improving their offers in this modality. This, added to the search for that initial savings that it provides during the first years, will make more and more Spaniards consider opt for a mixed mortgage”explains Carbajal. “Nevertheless, The fixed modality will remain a safe and increasingly interesting option also due to the expected drop in rates,” adds the Rastreator expert.
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