The Monetary Policy Council has raised interest rates for the seventh time since October. As of today, the reference rate is 4.5%, reaching the highest rate since November 2012. The decision was influenced by record inflation. According to the Central Statistical Office, the prices of consumer goods and services in March were higher by 10.9 percent. This is the first time in this century that we have reached a double-digit index. Borrowers have no doubts that installments will be even higher than before and achieving creditworthiness will be more difficult. Many of them decide to take a loan right now. At the end of March, banks received the largest number of loan applications in 10 years, which was certainly influenced by the introduction of the KNF recommendation regarding the calculation of creditworthiness.
The previous interest rate increases by the Monetary Policy Council were mainly aimed at combating rising inflation. However, this was changed by Russia’s attack on Ukraine, which has serious economic, trade and economic consequences for Poland. It is true that the zloty recovered a significant part of the losses from the beginning of March, but as long as the war continues, the position of the Polish currency against world currencies is still uncertain. Not only in Poland, but all over the world, in the coming quarters central banks will be forced to react more sharply than before.
Should I take a mortgage and when?
The seventh consecutive increase in the benchmark interest rate by 100 basis points reached 4.5%. – the highest since November 2012. The reason for the MPC’s decision is the fight against inflation, but it makes WIBOR grow together with him a variable interest rate on the mortgage, which translates into an increase in installments.
Despite the interest rate increases, the best and fastest way to buy your own “M” is still a mortgage. This is clearly seen in the high number of applications submitted last month. A certain difficulty for borrowers may be the new KNF recommendation regarding the calculation of their creditworthiness by banks, which entered into force at the beginning of April. The solution in this situation may be to choose a fixed interest rate. This guarantees that the amount of installments will remain unchanged for the period specified in the contract – says Maciej Dymkowski, managing director of the table of tables.
Will there be increases in real estate prices?
The final price of a property is influenced by many factors. Inflation and the war in Ukraine increase the costs of construction, the prices of building materials, energy raw materials, transport, as well as labor costs related to a sudden outflow
workers from across the eastern border. High interest rates also determine the price of money, i.e. the cost of crediting development activities.
We cannot count on a drop in real estate prices for the time being. Building material prices are rising, energy and fuel are expensive, and inflation is double-digit. The right location, land purchase, design, and execution – is often a multi-million undertaking. Many developers need external support to finance their investments, which means taking out a developer loan. High interest rates mean higher costs for the developer and ultimately a higher price of the property. That is why many people, despite high installments, consciously decide to take a mortgage right now, because there is no indication that the prices will fall. Buyers do not want to wait with the decision to buy their dream apartment until next year, when prices may go up by 10% – estimates Katarzyna Tworska, managing director of redNet 24, a company specializing in the sale of development apartments.
