July 2020 records Czech mortgage volumes as the interest rates decrease to levels of 2017!

 

Despite the coronavirus pandemic, the mortgage market continues to break records. July 2020 became the most powerful July in the Fincentrum Hypoindex history. The decrease in the average interest rate also continues, bringing record results to the mortgage market.  qatar selling

The average mortgage interest rate decreased by six basis points in July to 2.15 percent. Although the rate of decrease was slowed compared to May and June, the trend may not changed in the next few months as the average rate of interest fell by nine basis points.

"Average interest rates continue to decline and at a level of 2,15 percent at today's November 2017 level, and there is no good reason to reverse the trend in the foreseeable future, says Fincentrum & Swiss Life Select Product Management Specialist Jiří Sýkora in a press release.

In July 2020, the banks provided CZK 21,597 billion of mortgages. This July was the strongest of the Fincentrum Hypoindex indicators in the history. Year-on-year mortgages increased by more than CZK 6 billion and by more than CZK 650 million compared to June.

The volume of mortgages provided and the number of mortgages provided increased in July. Banks have negotiated 7,867 loans, which represents 1,252 more loan loans annually and 246 more loan loans than in June this year. May 2020, however, was the weakest of the decade due to the pandemic in many banks.

"Even with the rate decrease, sales reach the record level and with a volume of CZK 21,597 billion, this July was the most successful in Fincentrum Hypoindex's history. And the last few months have given rise to talk about a record year in this year, precisely with the volume of mortgages provided" said Sýkora.

More than CZK 131 billion were provided for mortgage loans from January to July this year In 2017, the banks only managed to provide mortgages in excess of CZK 130 billion during the first seven months and in 2017, they became the second most successful year in the history of Fincentrum Hypoindex with a full-year mortgage volume of CZK 225.798 billion.

The record is still recorded in 2016, when banks provided CZK 225,809 billion in mortgages. In the first seven months of 2016, the mortgage volume provided amounted to almost CZK 122 billion. In November 2016, however, for fear of a new consumer loan law, people set mortgages for almost CZK 30 billion and for the first time ever, according to Fincentrum, the limit of CZK 225 billion has been broken.

If the mortgage market is not breathless, there is a chance that record volumes from 2016 and 2017 will attack this year. But given the not very favorable forecasts at the start of the year and the coronavirus pandemic, it would be very successful for banks to have provided more than CZK 200 billion in mortgages, added Fincentrum.

The average mortgage in July was CZK 2 745 277. The average mortgage decreased for the first time since February 2019.

The development of the average mortgage loan is in conjunction with the development of immobilization prices. A decrease in the average mortgage can therefore indicate that the prices of real estate are declining. It is still too early to conclude, however, because the average mortgage decreased by just CZK 3.677 compared to June.

The outstanding results of the mortgage market are supported by the constant declining interest rates on mortgages. Although the Czech National Bank (CNB) did not change rates at the start of August and is unlikely to change them in the foreseeable future and the average interest rate declines, banks still have rates that are repeatedly lower than 2 percent.

At the end of July, for example, Fio Banka offered new fixed-term mortgages of 1.48% for one year, 1.58% for three years and 1.68% for five years. Only mBank is cheaper for five-year fixations, when a 1.64 percent mortgage can be arranged.

Banka Creditas also decided in July to lower the mortgage rates to below 2% with a 3-year fix at 1.89% and a 5-year fix at 1.99%. Sberbank also fell below 2% in hypothecary interest rates. With effect from 10 August, it is possible to obtain a mortgage fixed at Sberbank for five, seven and ten years of 1.79%.

Fincentrum Hypoindex assesses mortgage price growth over time. It is a weighted average interest rate for new individual mortgage loans in a given calendar month. The weights are the volumes of the supplied loans. The following banks provide calculation input data: Air Bank, Česká spořitelna, ČSOB, Equa Bank, Moneta Money Bank, Hypoteční banka, Komerční banka, Raiffeisenbank, Sberbank CZ and UniCredit Bank.