The national interest rate on housing loans fell in June for the fifth month and was 4.513%, compared to 4.556% in May. According to information released on Friday by the National Statistics Institute (INE), during the period in question, the interest corresponded to 61% of the average installment paid to the bank.
Taking into account the share of interest in the value of the contribution (61% compared to 53% the year before), INE reports that of the 404 euros transferred to the bank, 245 euros were used to pay interest and 159 to amortise the outstanding capital.
In contracts over the last three months, the contribution fell by six euros compared with the three months ending in May to 597 euros, representing a 2% drop compared with the same period last year, according to the National Statistics Office.
The average outstanding capital for all housing loans at the end of June increased by 355 compared to May, to 66,279 euros, which is 4.7% more than in the same month in 2023.
The cut in home loan rates is a direct reflection of the European Central Bank’s announcement of interest rate cuts, which the financial system had begun discounting to customers even before the 25 basis point easing last month.
Although ECB leader Christine Lagarde left interest rates unchanged last Thursday and left room for future changes depending on inflation, there are analysts who see further rate cuts later this year, in September and December.
Author: Joao Maltes
Source: CM Jornal
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