Average length of fixed-rate mortgages growing in Czechia

Average length of fixed-rate mortgages growing in Czechia

Published at: 2019-05-27 12:12 | Author: CIJEurope.com
The most popular mortgage among Czechs are those that offer a 5-year fixed interest rate, but Hospodářské noviny writes that the low rates on offer in recent years has made longer agreements more attractive. "Mortgages with fixed-rates for 8, 10, 15 even 20 years now make up more than two-thirds of all mortgage loans," claims Lukáš Kropík from Česká spořitelna. It's part of a trio of banks (together with Hypoteční banka and Komerční banka) that provides 80 percent of all mortgage loans. Komerční banka's spokesman Michal Teubner confirms the trend, saying that interest in 7 and 10-year fixes grew quickly especially towards the end of 2018. The Golem Finance brokerage reports that until 2015, mortgages with fixation periods of longer than five years made up just 10 percent of its deals. This increased to more than 40 percent in 2018. What's atypical about this stage of the economic cycle is that short-term fears about the future has made it cheaper to insure long-term rates than short-term rates. For consumers, this means that rather than paying extra for the security of a fixed-interest rates, 10-year fixed rate deals have nearly the same interest rate as 5-year fixes.

Similar Stories:

Banks now in competitive battle for mortgage clients
Mortgage rates continue to fall in the Czech Republic, but the trend is failing to stop th  »
Housing prices in Montenegro rising steadily
The average price of flats in Montenegro has increased by 18 percent since the beginning o  »
Boulevard opening in front of Stanica Nivy pushed back to fall 2020
Completion of the boulevard that's being built at Mlynske Nivy in connection with the  »
Foreigners behind a fifth of Prague residential sales
Foreign buyers have been behind 20 percent of all flat sales in Prague so far this year. T  »
Where do you see your company going over the next two years? Since I became GM of the co   »
Construction has begun on Bispevika, a brownfield project along Oslo’s waterfront that   »
PSN has sold 350,000 sqm of land to the dominant Czech residential developer Central Group   »
Investors from China, Russia and other countries are leading a growing influx of foreign f   »