Mortgage interest rates at record low in Netherlands
The mortgage interest rates in the Netherlands dropped to a record low over the past year. Those who took out a 20 year mortgage with National Mortgage Guarantee on January 1 did so at an interest rate of 1.23 percent, compared to 1.48 percent a year earlier, according to figures from comparison site Rente.nl, RTL Nieuws reports.
A low mortgage interest rate is beneficial for individual buyers, but for the housing market it is a double edged sword. Those who take out a loan with a low interest rate borrow more cheaply. But if borrowing is relatively cheap, more people will want to do it. That increases demand in an already overheated housing market, which will push house prices even higher.
Interest rates could fall even further this year, according to Rente.nl analyst Amanda Bulthuis. That depends on the developments around the coronavirus pandemic. "For example, how quickly the virus can be brought under control with the vaccinations and the eventual economic impact of the corona measures."
The comparison site does not expect any major interest rate hikes for this year. There may be another decrease, but it will be very minor. The margins for mortgage lenders are already under high pressure at the current low interest rates.