Interest rates on new loans to individuals to buy housing in the eurozone hit 1.94% in June, up 16 basis points monthly from 1.78% in May and the European Central Bank (ECB) composite indicator, according to the European Central Bank (ECB) composite indicator highest cost since June 2016.

The composite indicator, which combines the different interest rates on all loans to households for house purchase, rose in June on interest rate-related factors, the institute said.

In this way, the interest rate of 1.94%, which corresponds to the month of June, represents an increase of 64 basis points compared to the historical minimum of 1.30% observed in September 2021, although it is far from the maximum of 5 registered in September 2008 .55% away.

The highest compound interest on new home loans in June was observed in Greece (3.07%), ahead of Ireland (2.81%) and Germany (2.57%). In turn, the lowest interest rates were observed in France (1.35%), Portugal (1.46%) and Finland (1.59%). In the case of Spain, it rose from 1.63% to 1.69%.

Among the various loans, the interest rate for house purchase loans with a floating rate and an initial rate fixation of up to one year increased by 14 basis points to 1.66%.

Conversely, the rate on home loans with an initial rate fixation period of over one and up to and including five years rose 16 basis points to 2.03%, while with an initial rate fixation period of over five and up to and including 10 years it rose 21 basis points to 2 .23%.

For home loans with more than 10 years of initial rate fixation, the interest rate rose 12 basis points to 1.86%.

At the end of July last year, the Governing Council decided to raise interest rates by 50 basis points, bringing the rate on its financing operations to 0.50%, while the deposit rate reaches 0% and the lending facility rate, 0.75%.

In doing so, the ECB undertook a bigger increase in the price of money than expected in recent weeks, when several members of the Executive Committee indicated that the increase would be 25 basis points.

On the other hand, house prices in the euro area recorded an annual increase of 9.8% in the first quarter of 2022, which is the highest increase in house prices since Eurostat started collecting data in 2005.

Source europapress.es

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