A New Era for Owners
With the arrival of 2024, homeowners with variable rate mortgages can expect a favorable change in their finances. The decrease in Euribor, which is the key index for most mortgages in Spain, offers an opportunity for significant economic relief. Analysts predict that the average monthly fees could be reduced by almost 900 euros per year.
A Historical Descent
After a period of constant increase, where the Euribor reached 4.15% in August 2023, the index has started to fall. Currently, around August 2024, Euribor is hovering around 3.2%, marking the most significant drop since 2013.
The Impact on Quotas
This interest reduction comes as a relief to many homeowners who have experienced drastic increases in their mortgage payments in recent years. The current trend provides respite for those reviewing their mortgages this year.
Who Enjoys These Benefits?
The main beneficiaries of this drop will be homeowners with variable rate mortgages, especially those who carry out annual reviews. Specifically, for an average mortgage of 150,000 euros over 25 years with a differential of 1% over the Euribor, the monthly fee could decrease by approximately 73 euros.
Significant Annual Savings
This results in an annual saving of around 900 euros, offering considerable relief in the family budget. Those who review their mortgages every six months will also see an improvement, although it will be less significant.
Effects on the Real Estate Market
The drop in Euribor will directly affect household finances, as mortgages are often the biggest expenses. A saving of 900 euros per year represents a remarkable relief, especially in a context of increasing inflation and the high cost of living.
Boost to Demand
In addition, this trend could motivate more people to consider buying a home. With lower monthly fees and more competitive bank offers, the real estate market could experience an increase in demand.
Future Uncertain but Hopeful
Despite the significant drop in Euribor, experts warn that the future is uncertain and will depend on the decisions of the European Central Bank. If interest rates continue to fall, the Euribor could stabilize around 3% by the end of 2024.
Caution Necessary
It is important to remain cautious as, despite the good news, the financial market can be volatile and the decisions of central banks can vary depending on the global economy. Owners can now breathe easier, but vigilance remains essential.
