The general advice is that variable mortgage interest gives a lower mortgage interest over time.
But that’s not really true right now.
– In the coming months, the forecasts indicate that the variable interest rate will be higher than the fixed interest rate, says the private economist Arturo Arquez to News24.
Most people choose variable interest rates
Of SBAB’s statistics show that 94 percent of new customers chose variable interest rates in December. It is an incredible overweight compared to the 6 percent that tied the interest rate.
But it is not certain that it is the wisest choice. Right now, variable interest rates are actually more expensive than fixed interest rates.
Future interest rate cuts are already included in the forecast that forms the basis of the fixed interest rate at the banks.
Therefore, you can get information about future, likely interest rate cuts for the summer and/or autumn already now.
SBAB’s latest interest rate report This is how much the banks’ various mortgages cost
The longer you tie your loan to a certain bank and interest rate, the cheaper the loan usually becomes.
On economics focus there is a comparison between ten banks that offer mortgages, with the interest rates for the different fixed periods. The figures were updated on 15 March.
Nordea is the most expensive for both the 3-month loan (floating) and the 12-month loan, with an interest rate of 4.91 percent versus 4.68 percent. Swedbank and Handelsbanken are a few hundredths of a percent below Nordea.
The big banks most expensive: Swedbank, Nordea, Handelsbanken
This means that you who choose a 12-month fixed mortgage get 0.30 percentage points cheaper interest today compared to if you had chosen a loan that is variable for the three major banks.
– But it’s not really that simple. You have to start from your own finances and your own household’s conditions when you decide on fixed interest periods and amortization rates, says Arturo Arques.
But since the interest rates will probably be lowered below those levels as the key interest rates are lowered in the coming year, Nordea’s customers will be able to reduce their housing costs on the whole during the next 12 months.
But that is speculation. In addition, there are significantly cheaper mortgages on the market.
Cheapest mortgage at Ikano
Those who instead choose Ikano’s mortgage can get 4.68 percent in variable interest right now, but 4.19 percent for a twelve-month loan.
– The one-year (12-month fixed interest rate, ed. note) can be an alternative if you don’t think that interest rates will be lowered at such a fast pace that the total loan cost for the variable mortgage will be below that interest cost, says Arturo Arques.
The reason for the high interest rates is the historically high key interest rate decided by the Riksbank is 4.0 percent.
Only in November, for example, SBAB believes in its forecast that those with variable interest rates will pay less than those with fixed rates. Therefore, you can tie up your mortgage for 12 months in the future and save a substantial amount on what is probably the most expensive item of expenditure in the household budget.
Source: Ekonomifokus 15 MarchBoth fixed interest rate and floating rate
But there is a risk in locking your entire mortgage at one and the same point.
– When you then have to renegotiate your loan, there may be an interest rate spike. Then you risk having to pay even higher interest rates.
Arturo Arques: “Don’t lay all the eggs…”
Instead, Arturo Arques thinks the wisest thing is to spread the interest rate risk by tying the loan into two or three time horizons.
– For example, you can have part of the loan tied to variable interest and part of the loan tied for 3 and 5 years, says Arturo Arques and continues:
– You should rarely put all your eggs in one basket when it comes to finances, says Arturo Arques.
For those with strained finances
But for those with strained finances, you may not be able to choose. By committing to the mortgage now, you both reduce the immediate interest costs and can also more easily calculate what the costs will be in the coming year.
But then there is a risk of missing out on the expected interest rate cuts.
– The question is how risk-averse you are with your housing costs, concludes Arturo Arques.
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