"Finanztest": Slight easing of building interest rates
After a brief interest rate shock at the end of October, building interest rates had fallen again by the end of November - on average below the 4 percent mark. It is worth comparing offers for those looking to build.
4.27 percent interest - that's how much borrowers had to pay on average for their 80 percent mortgage with a ten-year term at the end of October. In the meantime, offers have improved significantly and the average has fallen back to just below the four percent mark. For a loan amount of 400,000 euros, this can still save 100 euros, according to the monthly analysis of the magazine "Finanztest" (issue 1/2024).
If you compare a little, you will find good offers well below the average. While in the previous month it was almost impossible to get a loan with the above-mentioned conditions for less than four percent interest, the selection has now become significantly larger again. According to the test, Hypofact (3.67 percent), DTW (3.69 percent) and Luna Finanzierung (3.70 percent) offer the best interest rates for 80 percent financing with a ten-year term.
Less equity does not have to be a disadvantage
If you want to fix the interest rate not just for 10 but for 15 years, you will have to dig deeper into your pockets. The best three offers here are only a touch apart. And here too, the top three are DTW (3.84 percent), Luna Finanzierung (3.85 percent) and Hypofact (3.86 percent) - albeit in a different order.
People looking to build who have more equity at their disposal benefit from slightly more favorable, but not significantly better conditions. Here too, the best offer comes from DTW, which is 3.60 percent for a ten-year term.
If you have to borrow more money from the bank to finance your dream property and can only raise ten percent of the purchase price yourself, you will only have to accept a small interest premium - if any at all. Provider Hypofact can maintain the offer of 3.67 percent for this group of buyers with a ten-year term compared to the 80 percent financing. The next best offer comes from Check24 with 3.76 percent. DTW and Luna Finanzierung charge premiums of around 0.1 percentage points (3.80 percent).
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- The construction industry may be affected by inflation, as increased material costs can impact building costs, which in turn could affect real estate prices.
- In the real estate market, some investors are turning to condominiums as a safe investment option, despite the potential impact of inflation on real estate prices.
- A landlord who offers a below-market rent to a tenant, in an effort to attract them and secure a long-term lease, may find it more difficult to refinance their real estate loan when interest rates rise due to inflation.
- An advisor may suggest that buyers in the real estate market consider securing a fixed-rate mortgage with a longer term, as a way to protect themselves against potential future increases in interest rates due to inflation.
- Despite the impact of inflation on interest rates, real estate loans are still available to those with lower equity, with providers like Hypofact offering competitive rates for 80% financing and 100% financing.
Source: www.ntv.de
