Mortgage Interest Rates in 2024: What can you expect?

-translated article from Leven Wonen-

What does the mortgage interest rate do in 2024? After the sudden increase in 2022 and a further rise in 2023, the rate has been declining again for several months. What does the remainder of 2024 have in store?

The level of the mortgage interest rate depends on several factors. One of them is the interest rate set by the European Central Bank (ECB). At 4%, it is historically high, with the aim of halting inflation. According to ECB President Christine Lagarde, this will not change before the summer of 2024.

Mortgage interest and capital market interest

The financial market assumed that the ECB would lower interest rates earlier. Now that this is not the case, the so-called capital market interest rate is rising. And because banks and other mortgage lenders borrow money for their mortgages on the financial market, there is a good chance that mortgage interest rates will also rise.

Second half of 2024

However, experts are much more optimistic about the second half of this year. Bloomberg news agency has asked several economists for their expectations. They predict that from June onwards, the ECB will gradually reduce the key interest rates from 4% to 3% in four steps. If this happens, a reduction in mortgage interest rates is a logical consequence.

Another factor determining the level of mortgage interest rates is the competition between mortgage providers. Competition is currently high, so many lenders are unlikely to quickly raise their rates significantly.

House prices up

Whether waiting for a lower mortgage interest rate is a good strategy when buying a house remains to be seen. House prices have been rising again for several months and are expected to continue to do so. Furthermore, the interest rate reduction in the second half of 2024 is only a prediction, not a certainty.

Certified Mortgage Advisor

If you want to buy a house, refinance your existing mortgage, or reset the interest rate period, you should of course take these developments into account in your decision. As a Certified Financial Advisor, also known as a Certified Mortgage Advisor, we can help you by calculating various scenarios for you. Feel free to make an appointment with us to find out how we can assist you.

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