This is the offer of mortgages in the final stretch of the year | My money

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The Covid stopped in its tracks the contracting of mortgages in 2020, but this year 2021 the market has recovered vertiginously. There is even talk of a new mortgage ‘boom’ that banks – in search of profitability in an environment of negative interest rates – want to make the most of it. Thus, in recent weeks several entities have launched to lower the prices of their mortgages even more, pushing the battle to attract long-term clients to the limit.

Although competition between banks tends to intensify at the end of the year to optimize figures, the strong growth in banks mortgages this course due to the boom in home buying and selling has motivated very aggressive offers, especially in fixed rates, which give more profit margin due to the Euribor lows.

Openbank and MyInvestor market the cheapest fixed mortgages of the moment, with an APR below 1.50% in the shortest terms. The digital bank of the Santander Group, where the fixed modality already accounts for about 70% of the new mortgage production, asks to domicile a payroll and take out home insurance. For its part, MyInvestor does not require a link, but does require a family income of at least 4,000 euros per month.

Nor is it necessary to hire products in Coinc, with equally very competitive rates. Ibercaja offers 1.50% APR for 20 years for payroll from 2,500 euros per month. Fulfilling conditions, Kutxabank reaches 1.68% APR; BBVA, 1.71%; Santander, 1.81%, and Bankinter, 1.95% at a fixed rate at different terms.

Javier Sánchez, head of mortgage product and MyInvestor accounts, indicates that the neobank is registering records in the granting of mortgages, 50% of which are at fixed interest, but admits that “the supply of fixed rates has reached levels that We believe it is difficult to improve them in the near future ”.

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Organizations such as the Bank of Spain have already shown their concern about the cheaper mortgages and the sector finds it difficult to offer rates lower than what can now be found in the market.

The fixed interest They are lower than ever – 2.6% on average, according to Statistics – and for months they have become the preferred option for mortgaged ones – they exceed 60% of new loans. The increasingly attractive offers and a possible rise in interest rates earlier than expected due to inflation have triggered their contracting, since they provide stability in the installments and make it possible to forget about the fluctuations of the Euribor to which the variable loans are linked.

Fixed-rate operations have exceeded 60% of the total for five months now

“Although the Euribor remains at a minimum, some buyers prefer not to gamble against drastic changes in the index that put it at higher levels,” says Sergio Carbajal, head of mortgages at Rastreator. This benchmark is expected to remain negative for a few more years, albeit with an upward trend. Thus, and as long as the rates of the European Central Bank (ECB) do not rise, something that the institution itself sees as very unlikely in 2022, the banks focus their offers on fixed and mixed rates, while there are hardly any cuts or news in variable interest rates. .

Evo Banco has lowered the interest on all its mortgages by 0.05 points, leaving the differential added to the Euribor at 0.83%, the lowest in the market, although now it requires a higher bond. They are followed by TargoBank and Pibank with 0.86% and 0.88%, respectively. 0.89% offer Kutxabank, Coinc, ING and MyInvestor. The majority of spreads are thus below 1%. Abanca, BBVA and Bankinter have it at 0.99%.

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Experts insist that choosing between one fixed or variable mortgage It depends on the customer’s profile. For its part, the OCU (Organization of Consumers and Users) warns: “although the entities promote fixed loans a lot and there are some with competitive conditions, the truth is that in the current panorama of rates we recommend variable mortgages as more interesting for now ”.

In general, the mortgages of the online banking they are cheaper than those of traditional entities. “A key factor in increasing competitiveness is the rise of digital banks which, by having a lower volume of costs, can promote more aggressive strategies and provide better conditions for customers”, underlines Gabriela Giannattasio, Director of Development of Business for Veritran in Europe, which points out that some long-time banks are already positioning themselves in the field of digital mortgages.

The accumulated savings due to the confinement, the jump to maximum of the sale of houses due to the stifled demand and the good mortgage conditions are favoring the Bank financing, something that is expected to continue in the coming months. “The number of loans granted by entities in 2021 has exceeded levels not seen since 2010, and everything indicates that between now and the end of the year it will continue the same”, highlights Sánchez.

And, looking to 2022, “the figures are even expected to be more favorable, since everything indicates that investment purchases will continue to grow,” says Carbajal.

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George Holan

George Holan is chief editor at Plainsmen Post and has articles published in many notable publications in the last decade.

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