The monetary policy of the European Central Bank (ECB) is reflected in falling interest rates for homebuyers. Who finances an apartment or a house by credit, has to pay his bank in some cases hardly interest.
According to a report by the credit intermediary Interhyp, interest rates on ten-year loans with good credit have fallen below the 0.5 percent mark. The financial service provider claims to have compared the terms of more than 400 financial institutions.
"Borrowers experience an unprecedented development in these weeks," said Interhyp executive Mirjam Mohr. Anyone who has a good credit rating and receives money for ten years can sometimes be in debt for around 0.4 percent interest annually.
The FMH financial advice comes to the conclusion that real estate loans are currently as cheap as never: Accordingly, fell on a loan with maturity of ten years recently 0.69 percent interest on average. Three weeks ago it was still 0.71 percent per year. With a lot of equity and good credit, top offers of 0.3 percent are possible.
Who wants to buy, should be careful
The problem for real estate buyers: Especially in sought-after locations, the market for housing or home purchases has already been swept away. In addition, the purchase prices are often very high. Consumer advocates warn that interested parties should not buy just because the interest rates are temptingly low. The lower interest rates are offset by far higher prices.
According to figures from the Federal Ministry of Finance, private households raised around 995 billion euros in 2018 to finance apartments and houses.
This development could intensify as pressure on banks continues to increase. Because the ECB has tightened the penalty interest on bank deposits again. Bunkers bunkers at the central bank excess money, they now pay a levy of 0.5 percent. "The banks want to get rid of their money, because the ECB is too expensive," says Max Herbst of the FMH financial advice. As a solution, there is a large volume of mortgage lending, which can be awarded with virtually no risk even at low interest rates. "Herbst therefore expects that institutions will further reduce their interest rates.
Are there building loans without interest soon?
The question arises as to whether banks could also offer real estate loans with negative interest rates. Instead of paying interest on their loan, housing buyers would get a discount on negative construction rates: they would not have to repay their bank the full amount of the real estate loan. For a sum of 200,000 euros, for example, it would be only 199,000 euros. And the interest burden on repayments would be completely a thing of the past.
The Deutsche Bank announced on request of the portal "Finanz-Szene.de", she plans "currently not to introduce negative interest rates for mortgage lending." Also at the Commerzbank it was said, this is currently "unimaginable".
Finance experts expect that negative real estate interest rates are only possible in individual cases. "It's possible that interest rates will drop to zero, but the likelihood of negative real estate mortgage lending is minimal," said Max Herbst of FMH Financial Advisory.
The Bundesbank considers negative interest rates on real estate loans in principle conceivable and gives itself relaxed. Although borrowing will become more attractive to customers with negative interest rates, said CEO Joachim Würmeling. "It's all the more important that banks do not relax lending standards." That is not to be seen on a broad front.
