Mortgage Resurrection Continues In October: Up 18%

24/12/2014 – Cinco Dias

The signing of new mortgages for home purchase rose 18% in October, for the fifth consecutive month in comparison to last year; although the increase was lower than in the previous month, which was 29.8%.

According to provisional data published today by the National Institute of Statistics (INE), last October, 17,687 new mortgages were signed to buy homes, compared to 19,323 signed in the previous month, marking a monthly drop of 8.5%

Also, the total cost of these loans stood at around €1.766 billion in October, nearly 15% up from last year and 15.2% less from the previous month.

Meanwhile, the average amount of mortgages went back down to 100,000 EUR and stood at 99,866 EUR in late October, which is 7.4% less than in the previous month and 2.6% less than in the same month in 2013, according to the INE.

92.8% of the mortgages signed in October use a variable interest rate, compared to 7.2% that use a fixed rate. The euribor is the most common reference in constituting variable interest rate mortgages, specifically in 89.7% of new contracts.

The average interest rate at the beginning of the mortgage for the total number of properties is 3.78%, while the average time is 21 years. The average interest rate, at the beginning, for the mortgages on residential property is 3.6 percentage points, 14.1% lower than in October 2013.

Original article: Cinco Dias

Translation by: Aura REE