More mortgage pain as Euribor goes up again

31st August 2006, Comments 0 comments

31 August 2006, MADRID — Mortgages continued to rise on Thursday with the latest Euribor rate going up to 3.615 percent.

31 August 2006

MADRID — Mortgages continued to rise on Thursday with the latest Euribor rate going up to 3.615 percent.

This is the highest level since July 2002 and the biggest increase for six years.

The rise in the Euribor in August was one point, compared with July.

The Euribor, which is used to fix mortgage rates in Spain, rose 1.392 points compared with August last year, representing a 62 percent increase overall.

In 1999 and 2000, there were bigger increases, when the Euribor went up by 2.682 percent and 4.848 percent.

In real terms, an average mortgage of EUR 153,445 over 25 years, will now cost the mortgage holder EUR 820 each month, instead of EUR 705 – a rise of EUR 113.

David Cano, an expert with International Financial Analysts, said the Euribor was going up at a more moderate rhythm than expected.

But Cano said with mortgages rising, the average mn in the street is going to spend less money, reducing demand.

This may have knock-on effects on the economy as a whole.

[Copyright EFE with Expatica]

Subject: Spanish news

 

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