“It’s too early to clarify everything”: These are Comparative forecasts for mortgage interest rates

class = “sc-cffd1e67-0 fmXrkB”>

One message made Swiss households sit up and take notice: “Fixed-rate mortgage interest rates in Switzerland are now falling rapidly.” Financial portal “Cash” reported this last week. This was based on analysis of recently falling swap rates.

Just a week later, comparison service Comparis warned that the sharp decline in swaps making fixed-rate mortgage terms cheaper should not be misinterpreted. So how can we best evaluate the situation on the interest rate front?

The truth is: Inflation rates have been falling for several months. The pressure on central banks to fight inflation by increasing interest rates is decreasing. At the same time, hopes are growing that the Swiss National Bank (SNB) will soon reduce interest rates. If capital market interest rates decrease, banks’ refinancing costs (swap) also decrease.

How can Swiss homeowners lower their mortgage interest rates?

High electricity prices and rents continue inflationary pressure

Comparative finance expert Dirk Renkert (58) explains the warning against misinterpretations as follows: “In addition to geopolitical uncertainties, cost factors such as rent increases and electricity prices also put permanent pressure on inflation. Therefore, it is too early to clarify everything.” According to Renkert, the uncertainties provide the SNB with only limited room for rate cuts.

The Comparis mortgage interest rate forecast predicts that: Interest rates on medium- and long-term fixed-rate mortgages are likely to move sideways next year, with a slight downward trend. The comparison portal expects an interest range of 2.00 to 2.40 percent for ten-year fixed-rate mortgages. Target interest rates are currently 2.31 percent (as of December 8, 2023). This is still significantly lower than the 3 percent level at the beginning of the year.

In the case of Sarong mortgages, Comparis finance expert Renkert assumes in his statement that there were initially “no significant changes”.

His advice to anyone looking to refinance their home: take advantage of market fluctuations and don’t accept the first interest rate offer you come across. There can be a world of difference between the interest rates mortgage providers advertise on their windows (guide interest rates) and the negotiated interest rates. Bottom line: get a few offers and bargain hard. In the current environment, fixed-rate mortgages are generally significantly cheaper than Sarong mortgages, according to Renkert.

Source :Blick