Prestação da casa indexada à Euribor a três meses descerá em dezembro e janeiro

House installment linked to 3-month Euribor will decrease in December and January.

For those who have contracted the three-month Euribor on their variable rate mortgage, in December and January they will begin to feel a slight reduction in the monthly installment they pay. This is because interest rates have already reached the maximum limit. Understand better when each term begins to impact the house payment.

27 Dec 20233 min

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Want to improve your housing credit conditions? The credit intermediaries from Poupança no Minuto can help you find different solutions, contact us or make a simulation.  

Do you have the three-month Euribor in your home loan? You will feel relief in the installment.

The governor of the Bank of Portugal (BdP), Mário Centeno, announced that the maximum values of the Euribor in the fourth quarter of the year have already been reached.  

So, in December and January contracts indexed to the three-month Euribor will experience a slight reduction in the monthly home payment.  

"The quarterly updates in contracts using the three-month Euribor from December and January will already reflect a slight reduction in interest rates," confirmed Centeno at the press conference presenting the December Economic Bulletin. 

Contracts indexed to 12 months, the governor explains, will feel the impact of the stabilization of rates in February, March, and April.  

Therefore, "if there are no additional shocks, this will be the trajectory throughout 2024," concludes.  

In the context, this conclusion comes from the decision of the European Central Bank (ECB) to keep unchanged the interest rates applicable to main refinancing operations and the interest rates applicable to the permanent liquidity-providing facility and the permanent deposit facility at 4.50%, 4.75%, and 4.00%, respectively.

Remembering that Euribor rates have been rising with more impact since February 2022, following the increase in benchmark interest rates resulting from the escalation of inflation in the eurozone and the beginning of the invasion of Ukraine by Russia in the same month.

Prior to this scenario, the all-time lows for Euribor rates were recorded on December 14 and 20, 2021, with negative values: -0.605% for three months, -0.554% for six months, and -0.518% for twelve months.  

Note also that Euribor rates are defined through the average of the rates being practiced by 19 eurozone banks among themselves in the interbank market.

Relief in Euribor rates: A good time for variable-rate mortgage credit?  

Despite starting to stabilize and even slow down, the Euribor rates continue to remain at high values and will take some time to return to levels similar to those of two years ago.

So, at this time, it is still worthwhile to hire a fixed or mixed rate, compared to the variable rate linked to Euribor, depending on the banks' campaigns.

There are banks promoting campaigns with mixed rates, where it is possible to fix the rate for one year at 2%. Meanwhile, Euribor rates are at 4%.

In other words, if you want to take out a new loan on a financial level, a mixed or fixed rate may be worth it. But it always depends on your preferences and what you are looking for. Other factors may weigh more in choosing the rate, such as stability, the possible forecast of lower Euribor rates in the future, among others.  

If you want to simulate various situations, you can use our Mortgage Simulators. Then, analyze the different proposals from banks and access the help of credit intermediaries at Poupança no Minuto to choose the most suitable financing for you!

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