Bank crisis leads to cheaper mortgages

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Bank crisis leads to cheaper mortgages

Due to the unrest in the financial sector and the various banks that have collapsed and bailed out, mortgages are rapidly becoming cheaper. Last week the decline was so rapid that it is one of the fastest declines in the past nineteen years, according to De Hypotheekshop.

Mortgage interest rates fell about 0.2 to 0.3 percentage points this week. Since 2004, this has happened only four times before. Normally it takes several weeks for lenders to implement the rate cut, but this time some lenders responded within days. According to the Mortgage Shop, this is due to the strong decline in demand for mortgages in the past year, as a result of which lenders compete for an increasingly smaller group of potential customers.

Investors are fleeing to government bonds

In times of uncertainty, investors often turn to government bonds, which are generally considered safe investments. As a result, these debt securities increase in value, causing interest rates to fall. Two weeks ago, this also led to a fall in capital market rates, to which mortgage rates are linked.

Due to the unrest in the financial sector and the various banks that have collapsed and bailed out, mortgages are rapidly becoming cheaper. (ANP / Hans van Rhoon)

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