Loans with floating interest rates are currently a rarity in the offer of banks. Until recently, fixed-rate loans, which were more expensive, are now more profitable.
The real estate market has changed a lot in recent months. Apartment sales have slowed down, and cash buyers dominate among buyers. The most expensive mortgages in history rule out most borrowers, and buying an apartment as an investment with borrowed money makes no sense at such a high installment rate. Record interest rates are responsible for everything. The cycle of hikes is not over yet, and yesterday’s fast inflation readings (over 16%) prove that the Monetary Policy Council will announce several more rate hikes.
Fixed rate loans are the new normal
If someone gets a loan, the bank encourages them to take out a loan with a fixed interest rate. This is interesting because about a dozen months ago, fixed-rate loans were seen as a fad. No one expected such fluctuations in the market, and a fixed-rate loan is more expensive than an excess, so only a few customers were willing to pay more for peace of mind. A loan with a fixed interest rate allows you to repay the same amount in installments over 5 years, regardless of changes in interest rates. Clients abroad can conclude a permanent loan agreement for the entire duration of the agreement, in Polish conditions it is only 5 years. Not a single bank has decided to extend this period, although there are no contraindications for this.
However, something is starting to change. Banks are promoting fixed rate loans, so it is possible that they will offer longer collateral in the future. According to an analysis by Bankier.pl, a mortgage loan with a floating interest rate is cheaper in only four banks than a similar product with a periodically fixed interest rate.
The effects of this policy are already visible: for example, in PKO BP, the largest lender on the Polish market, in the second quarter fixed-rate mortgages accounted for 79 percent. new contracts.
Source: Wprost
