Are you looking for a home or are you considering refinancing your mortgage? Then there is good news: the recent increase in mortgage rates is already over. Rates are falling, which can be beneficial for your housing plans.
The short-term interest rate increase
At the end of January, we saw the highest increase in mortgage rates since October last year. The interest rate for a mortgage with a fixed interest rate period of ten years rose by 0.11% to 3.65% in January. But this increase appears to have been short-lived. This has now come to an end and we are even seeing falling rates again.
Current interest rates
According to De Hypotheker, the mortgage rate for ten years fixed with NHG is currently around 3.3%. This is a significant decrease compared to the peak in January. Van Bruggen Adviesgroep also confirms this trend and reports that various lenders have implemented slight reductions since the beginning of this month.
What explains this fall in interest rates?
The recent fall in mortgage rates can be explained by several factors:
- US President Donald Trump initially announced high import tariffs for Canada, Mexico and China, which made investors fear inflation
- After Trump withdrew the tariff increase for Canada and Mexico, long-term interest rates on the financial markets fell immediately
- The development of inflation in the eurozone plays an important role in the interest rate policy of the European Central Bank (ECB)
Future expectations
The development of interest rates remains uncertain for the short and medium term. Much depends on inflation in the eurozone. If inflation is low, the ECB may decide to lower the interest rate as well, which would be beneficial for mortgage rates.
In January, the ECB indicated that it would probably lower the interest rate by 0.25% in March. However, in January, inflation in the eurozone unexpectedly rose to 2.5% - the fourth month in a row with an increase. If inflation does not fall quickly, there is a chance that the ECB will not lower the interest rate in March after all.
In addition, the unpredictable course of US President Trump makes it difficult to predict long-term interest rate developments.
What does this mean for you?
If you are planning to buy a home or transfer your mortgage, this may be a good time to take action. Interest rates are currently relatively low, and there is uncertainty about how they will develop in the future.
It may be wise to explore your options now and seek advice on what is the best choice in your specific situation. It may be useful to take advantage of the current interest rate drop, especially if you want certainty about your monthly payments for a longer period of time.
Personal advice from M&D Real Estate
At M&D Real Estate, we closely monitor interest rate developments. We understand that choosing a mortgage and the associated fixed-rate period is an important decision that has a major impact on your monthly payments.
Do you want to know what the current interest rate drop means for your specific situation? Or are you curious about the possibilities of buying a new home or adjusting your current mortgage? Please contact us for a personal consultation.
Are you also thinking about sustainability when buying a new home? Our partner https://www.labelbewust.nl can help you make your home more energy-efficient, which is not only good for the environment but also for your wallet.
We are happy to think along with you about the best strategy in this dynamic interest market!