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Development of building interest rates: This is how inflation data and federal bonds influence interest rates
Since the beginning of last year, building interest rates in Germany have risen continuously. In January 2022, the interest rate on a ten-year fixed rate loan averaged one percent, but in November 2023 it rose to over four percent. However, the increase has slowed in recent weeks. According to the Düsseldorf-based consulting firm Barkow, a loan over ten years currently costs 3.58 percent interest. Half a percentage point less on a loan of 300,000 euros means an interest rate difference of 1,500 euros per year for loan customers. The key factor in the development of building interest rates is the interest rate for ten-year federal bonds, which is determined by the...
Development of building interest rates: This is how inflation data and federal bonds influence interest rates
Since the beginning of last year, building interest rates in Germany have risen continuously. In January 2022, the interest rate on a ten-year fixed rate loan averaged one percent, but in November 2023 it rose to over four percent. However, the increase has slowed in recent weeks. According to the Düsseldorf-based consulting firm Barkow, a loan over ten years currently costs 3.58 percent interest. Half a percentage point less on a loan of 300,000 euros means an interest rate difference of 1,500 euros per year for loan customers. The key factor in the development of building interest rates is the interest rate for ten-year federal bonds, which is influenced by the latest inflation data in the USA.
According to a report by ga.de,
As a financial expert, I can say that this development has a direct impact on the real estate market and the lending industry. A fall in building interest rates means that loans for building a house or buying real estate become cheaper. This could result in an increase in demand for real estate and new loans. If more people invest in the real estate market, it could increase property prices and lead to a boom in the construction industry.
On the other hand, a fall in building interest rates means a lower return for banks and credit institutions that grant mortgage loans. This could have a negative impact on the profits and profitability of these companies. Additionally, an increase in credit demand could lead to increased competition among lenders, which could lead to further reductions in interest rates.
Overall, it is important that borrowers keep an eye on current developments on the real estate market and benefit from the lower building interest rates. At the same time, banks and credit institutions should consider possible impacts on their business models and offerings in order to remain competitive.
Read the source article at ga.de