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The turmoil of war put a strain on the interest rates for capital lending. This has implications for Swiss homeowners. You can count on attractive mortgages.
As a result, mortgage interest rates have fallen on average in Switzerland in recent days compared to February.
20min/Simon Glauser
This is shown by a look at the ten best offers from the mortgage broker Moneypark.
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The war in Ukraine is weighing on the global economy.
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As a result, interest rates fall when capital is allocated.
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Mortgages have also fallen on average compared to February.
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There should be more attractive offers in the coming weeks.
The war in Ukraine is having a negative impact on economic recovery worldwide. Swiss homeowners are also feeling this – albeit in a positive sense: Because of the chaos of war, mortgages are now cheaper once more, as mortgage broker Moneypark writes in a statement.
This is shown by looking at the ten best offers from the intermediary. On average, the interest rates for fixed-rate mortgages with the most common maturities have fallen by a significant six to eight basis points compared to February. A basis point is equal to one hundredth of a percentage point.
The rate for a five-year fixed-rate mortgage was offered at 0.94 percent, while the 10-year rate was 1.31 percent. The cheapest offer for 10-year-olds was 1.05 percent, which corresponds to a reduction of 12 basis points (previously 1.17 percent).
Mortgage Delay
As Moneypark writes, the war has pushed down capital market interest rates in recent days. This reflects the fear of negative consequences for the global economy. In addition, the confidence of consumers and companies is probably falling and investments are being postponed. The central banks are also likely to hold back on the interest rate hikes that have been announced (see box).
Until recently, a return to normalization with higher interest rates seemed within reach. With the outbreak of war, these expectations suffered a setback. With the currently negative prospects, the allocation of capital on the markets is offered at lower interest rates.
According to Moneypark, with a slight delay, there has now also been a significant reduction in mortgage interest rates. “Even if there was a slight increase recently, almost a third of the rise in interest rates since the beginning of the year has been wiped out,” according to the statement.
It is expected that capital market rates will continue to fall slightly. The developments in the Ukraine war and in the corona pandemic are decisive. The intermediary sees further declines in mortgages of two to five basis points for the top offers in the next few weeks.
Attractive interest rates in sight
Furthermore, the lower capital market interest rates are likely to lead to lower mortgage interest rates with a slight delay, especially for longer maturities. “We expect attractive mortgage interest rates in the next few weeks,” says Moneypark.
The intermediary therefore recommends following the development of the capital and mortgage markets in a timely manner.
The central banks are currently in a dilemma: should interest rates be raised or not? On the one hand, inflation is rising worldwide, which would argue for an increase in interest rates. On the other hand, higher interest rates might stifle economic growth. The mortgage broker Moneypark therefore assumes that the US Federal Reserve will exercise caution with the announced interest rate hikes. In the euro area, there is a relatively high probability that the European Central Bank (ECB) will weaken or postpone the course change it has announced for March. The interest rate decision by the ECB is due on March 10th.
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