“Banks are no longer reducing at the same pace as in previous months. The main reason is the price at which banks raise money for further lending on the interbank market. And it was the price of money on the interbank market that began to rise rapidly in November, ”points out Jiří Sýkora, an analyst at Fincentrum & Swiss Life Select.
While at the beginning of November, domestic banks borrowed funds for mortgage loans for a period of five years with an annual interest rate of 0.5 percent, now, according to Thomson Reuters, it is 1.05 percent, more than double.
Rewriting price lists, although probably not initially dramatic, is said to be on the decline. “The development of rates will be decided by the demand for mortgages in the first months of next year. However, from our point of view, a slight increase is more likely than a decrease in rates, “says Libor Vojta Ostatek, head of the consulting company Golem Finance.
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It was in the last quarter of this year that mortgage interest rates, whose average rates fell below two percent, according to the Fincentrum Hypoindex, allegedly hit an imaginary bottom.
“In 2021, the greater riskiness of clients and the weakened economy will be reflected in interest rates, which will gradually rise,” says financial specialist Veronika Hegrová from the Hyponamiru.cz portal. According to her, mortgage interest rates will probably be in the range of two to three percent in the first half of the year.
“We will probably bounce back from the interest rate bottom soon. So people who are considering arranging a mortgage should not linger too long. Otherwise, it is possible that they will miss the best opportunity to negotiate a housing loan, “recalls Štěpán Křeček, an economist at BH Securities.
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Paradoxically, this year will probably be a record year for mortgages, despite the pandemic. In the first eleven months of this year, approximately 224 billion crowns were provided on mortgage loans. Compared to the same period last year, banks lent almost 61 billion crowns more on mortgages.
November 2020 itself has even become the second most successful month in history. Less than 27 billion crowns were provided on mortgage loans, which was exceeded only in November 2016.
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