“Interest rate policy hinders recovery housing” – Parool.nl

"Interest rate policy hinders recovery housing" – Parool.nl

27-01-15 06:50 – Source: Reuters

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The recovery of the housing market is hampered in the expensive segment as banks increasingly high demand for mortgage interest spread outside the National Mortgage Guarantee (NHG). That writes the Financieele Dagblad today.

The store does a large part of the interest rate cuts by the European Central Bank canceled. Houses up to a maximum mortgage of 265,000 euros eligible for NHG. This arrangement provides both the buyer and the lender’s guarantee against default.

Banks and insurers therefore charge a lower interest rate for a NHG mortgage.

However, the interest rate differential between NHG and non-NHG has tripled compared to the period before the crisis, when the store still ranged between 0.2 and 0.4 percentage points. Banks and insurers want to avoid risks due to stricter capital requirements.

The average rate on a NHG mortgage with a term of ten years, last year dropped from 4 to 3 percent. Interest rates on mortgages without NHG still hovering around 4 percent.