The European Central Bank (ECB) has decided to pause interest rates and has left the three key interest rates unchanged. Financial experts had already expected this. This means that everything remains the same for property financing. Buying a property is still easy to calculate at the moment.
The downward trend in inflation in the eurozone has slowed considerably in recent months. Core inflation, which excludes particularly volatile prices, remains well above the ECB's target of two per cent at just under three per cent.
"The European monetary authorities' battle against high inflation rates has not yet been won," says Heiner Herkenhoff, Managing Director of the German Bankers Association. "The ECB's decision to leave key interest rates unchanged is therefore absolutely right." Ifo President Clemens Fuest also welcomed the ECB's decision to maintain the interest rate pause. "Inflation is currently moving towards the target of 2.0 per cent. It is therefore right not to raise interest rates any further. However, it would be too early to lower interest rates again because there are still inflation risks.
Of course, many had hoped for a reduction in interest rates, which would have stimulated the German economy and in particular the property and construction industry. The average best interest rates for mortgages have risen slightly since May: From 3.13 to 3.30 per cent for 10-year fixed rates and from 3.28 to 3.43 per cent for 15-year fixed rates. At the beginning of the year, the market had high expectations of the central banks and the first interest rate hikes were priced in. There are currently no signs of falling interest rates.
Experts advise: The affordability of home ownership is significantly better today than it will be in 2023. Incomes have risen across the board, while property prices have fallen. Building interest rates are relatively low by historical standards of recent decades. Against this backdrop - and also because property prices are expected to rise again - now is a good time to buy a property. Prospective buyers should utilise the available scope for negotiation.
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