How does the mortgage interest rate develop in 2019? We give our mortgage interest expectation based on recent developments in the market.
Mortgage interest rate low
With a lowest mortgage interest rate of 1.00%, we can rightly speak of a historic low. The interest currently breaks records on all fixed-rate periods. For example, the popular mortgage interest rate has probably not been this low for 10 years.
The central bank keeps the policy interest rate low and pumps billions into the economy every month by buying up unattractive loans. This has a depressing effect on market interest rates. Banks can get money cheaply on the money market and capital market to lend.
The mortgage interest rate is therefore low. The same also applies to the interest for borrowing money with a consumer credit and (unfortunately) also for the savings interest.
Mortgage interest expectation 2019
The ECB last stepped up its crisis measures in March. The policy interest rates have been further reduced and the purchase program has been extended and extended until March 2017.
Market conditions have changed slightly since October. The capital market interest rate has risen for the first time in a long time. This is partly due to a higher inflation forecast, an unexpected growth of the British economy (despite the Brexit) and a possible interest rate rise by the US central bank.
The capital market interest rate is an important indicator of the long-term mortgage interest rate, for example 20 years fixed. In the meantime, the first lender has also raised their mortgage rates, including Woonfonds, Centraal Beheer and Hypotrust. At the same time, there are still lenders who lower their interest rates.
Is the mortgage interest rate going to rise in 2019?
It is therefore difficult for the ECB to increase the pressure on market rates. The bottom of the low mortgage interest rate seems to be in sight. This means that, at most, mortgage interest rates will fall slightly and remain stable at the current low level.
A possible rise in mortgage interest rates must come from further economic recovery. Once investors gain confidence and start speculating on growth, market interest rates may rise in the long term. However, this is an expectation for the long term. Read more about mortgage interest rate development in 2017.
Competition on the mortgage market
The fall in mortgage interest rates is being exacerbated by increased competition in the mortgage market. In 2015, the pension funds in particular profiled with a low mortgage interest rate. This puts pressure on traditional banks to lower the margins on mortgage rates. In addition, there are more options in 2019 for reducing mortgage rates.
In 2019, however, the banks are making a comeback. By providing customized solutions and the possibility to close old mortgage products, banks are popular with homeowners who want to relocate or relocate.