Current interest rate situation for mortgage loans

Then please also explain to the forum participants that the ECB rate has nothing to do with the long-term refinancing for real estate financing. Today's decision does absolutely nothing to interest rates for real estate financing.
To follow the market, you have to take the SWAP mid rates. That is the refinancing basis / calculation factor.



On top of that, the bank adds its margin as well as liquidity costs. In the case of portals and brokers, there is also 1-4% commission included in the condition.

What can the interested reader do with this? Which fixed interest period? What loan-to-value ratio? Which region? What term = repayment? What customer creditworthiness?

Of course, I could add all the swap rate values to my thread. However, I believe that would exceed the imagination of most readers and they would not be able to make use of it. What is important is which fixed interest conditions are currently available on the market.
I provided the Euribor rates to draw attention to the strong increase and to make a comparison between variable and fixed interest (I should have added that).

Thanks for the info that there is already a similar thread here, I unfortunately overlooked that.

Of course, I could add all the swap rate values to my thread. However, I believe that would exceed the imagination of most readers and they wouldn’t be able to make use of it. What matters is which fixed interest conditions are currently available on the market.

Then you should have just left it alone. Nobody can do anything with Euribor since practically no one (privately) uses it and it has nothing to do with long-term financing. And a "the interest rate is between 3.5% and 4.5%" means as much to me as "a car costs between €30,000 and €50,000." So please link it with data or create a matrix.

And please again, don't "believe." Let the readers decide for themselves what to do with the information. That’s better than you giving false information.
Anyone who looks at a swap rate over 10 years and now knows that it is basically the bank’s calculation rate, with which they buy money for a loan, can easily see how rates develop, because at any time the bank’s margin simply has to be added.
If Swap = 2.0% and interest offer 3% on 10.01, then with Swap 3.0% the realistic offer from the bank is 4% in March. Because of Euribor development or ECB development, you get nothing.

Key interest rate increase mid-September to 1.25% – 10-year mortgage 3.16%
Key interest rate 17.10. 1.25% – 10-year mortgage 3.87%
Key interest rate increase 02.11. to 2% – 10-year mortgage 3.60%
Key interest rate increase 21.12. to 2.5% – 10-year mortgage 3.35%
Mortgage interest rates from Dr. Klein
So I can read that no key interest rate change from September to mid-October caused mortgage rates to rise by 0.70%. A doubling of the key interest rate from October to December, however, led to an interest rate decrease of half a percent.

So please don’t tell the readers anything about a direct correlation between the ECB and mortgage rates. If you have no clue, that’s totally okay. But then please don’t spread false information and don’t assume the reader is incapable of understanding correct facts.

Then you should have just left it alone. No one can do anything with the Euribor, since practically no one (privately) uses it and it has nothing to do with long-term financing. And a "the interest rate is between 3.5% and 4.5%" is just as meaningful to me as "a car costs between €30,000 and €50,000." Then please link it with data or set up a matrix.

And please again, don't "believe." Let the readers decide for themselves what to do with the information. That’s better than you giving false info.
Anyone who looks at a swap rate over 10 years and now knows that this is basically the calculation rate for the bank, with which they buy money for a loan, can easily see how rates develop since at any given time simply the bank’s margin has to be added.
If swap = 2.0% and interest offer 3% on 01/10, then with a swap of 3.0% the bank’s realistic offer is 4% in March. Due to a Euribor development or ECB development you are stuck.

Key interest rate increase mid-September to 1.25% – construction financing 10 years 3.16%
Key interest rate 17/10 1.25% – construction financing 10 years 3.87%
Key interest rate increase 02/11 to 2% – construction financing 10 years 3.60%
Key interest rate increase 21/12 to 2.5% – construction financing 10 years 3.35%
Construction financing interest rates from Dr. Klein
So I can see that no change in the key interest rate from September to mid-October caused the construction financing interest rates to rise by 0.70%. However, a doubling of the key interest rate from October to December led to an interest rate reduction of half a percent.

So please don’t tell readers anything about a direct correlation between the ECB and construction financing interest. If you have no idea, that’s totally fine. But please don’t spread false info and don’t assume the reader is mature enough to understand correct facts.

Why this sharpness, KarstenausNRW? :D
The Euribor is very important indeed, namely for the Austrian readers among us. These are used by Austrian banks as reference interest rates for variable interest. At the building societies, the 12M Euribor applies, for example the Oberbank uses a 6M Euribor, and most rely on the 3M Euribor.
Regarding swap rates, each bank uses a different one for calculating their fixed interest rates, so for the customer, it is mainly important where the bank’s fixed interest rate lies.
Depending on the bank and creditworthiness, the fixed interest rate can range between 3.5% and 4.5%, which in my opinion is a very helpful indication, which, it seems, only you don’t like.

By the way, swap rates have fallen since the key interest rate increase. To explain to you why these can fall and so I don’t have to be told I am giving too few details:

Interest rate expectations: A falling swap rate can be an indicator of declining interest rate expectations. If market participants expect interest rates to be lower in the future, this can lower the price for swaps.

Risk aversion: An increase in risk aversion in financial markets can lead investors to flee into safe assets like swaps, which can cause the swap rate to decline.

Economic conditions: Economic conditions have a direct impact on the swap rate. A weaker economy can cause interest rates to fall and reduce the swap rate.

Political events: Political events such as elections or government crises can cause investors to become nervous and flee into safe assets like swaps, which can lead to a decline in the swap rate.

It is important to note that the above factors are only some of the possible ones that can influence the swap rate.

You just explained yourself why your concept of a correlation between the key interest rate and [Baufinanzierung] from the initial post is nonsense ;)

You just explained yourself why your concept of a correlation between the key interest rate and construction financing from the initial post is nonsense ;)

For me, the following connection arises between the key interest rate and construction financing:
The key interest rate has a direct influence on construction financing. A higher key interest rate increases the costs of construction financing because banks and other lenders demand higher interest for their loans. Conversely, a lower key interest rate can reduce the costs of construction financing.

For me, the following relationship between the key interest rate and mortgage financing arises:

Ok. Even if it no longer has anything to do with the original topic.
We will break down the whole system of key interest rate and mortgage interest rate for you:

What is the key interest rate?
The key interest rate refers to the interest rate at which credit institutions can borrow money from the central banks. The key interest rate therefore reflects the price that credit institutions have to pay for new funds. For Germany and the other countries of the euro area, the European Central Bank (ECB) sets the key interest rate – more precisely, the ECB Governing Council, which forms the highest decision-making body of the ECB.
The ECB is responsible, among other things, for price stability in the euro area. Because stable prices enable healthy economic growth and corresponding consumption. Therefore, the ECB tries to control the money supply in the economic cycle, among other things, by adjusting the key interest rate and purchasing government and corporate bonds.
There are a total of three key interest rates in the euro area. The most important of them is the main refinancing rate.

[*]The main refinancing rate: In general usage, this is also called the ECB key interest rate or simply the key interest rate. It determines the interest rate at which credit institutions can borrow money from the ECB on a short-term basis.
[*]The deposit rate: This is the interest rate at which commercial banks can park excess money with the ECB overnight.
[*]The marginal lending rate: It indicates the rate at which commercial banks can borrow money from the ECB on a short-term basis.

Overall, the ECB’s key interest rates are an important monetary policy instrument to keep the economy in the euro area balanced and to enable a stable price level. When the economy is doing well, the ECB withdraws money from the economic cycle. If the economy is to be stimulated, it supplies money. Thus, the currently low key interest rate is intended to stimulate inflation and the economy in the euro area.

Is there a direct connection between the ECB key interest rate and mortgage interest rates?
The ECB key interest rate only influences current mortgage interest rates indirectly. A reaction chain can occur but does not have to.
Usually, the ECB announces a change in the key interest rate long in advance, even before it changes the key interest rate. Both the money market for short-term investments and the capital market for long-term investments react already upon an announcement of a key interest rate change. If the key interest rate actually changes, the money market usually reacts even more strongly because short-term interest rate changes can be passed on to customers faster.
Long-term investments, on the other hand, are less flexible. They set their course already upon the announcement of a key interest rate change. If there is an ECB key interest rate change, no further adjustment is necessary.
A mortgage financing counts as a long-term investment. Here, announcements about interest rate changes often have a time-delayed and dampened effect compared to movements on the money market.

Covered bonds for the refinancing of banks
Banks usually borrow the money for a mortgage financing, i.e., the loan amount, from an investor. Experts then speak of refinancing. For the refinancing of mortgage loans, banks mainly use the trading of securities.
If an investor lends the bank the money for a mortgage financing – often institutional investors such as fund companies or insurance companies – they receive a fixed interest rate over the duration of the term in return. In technical jargon, this is called a "covered bond." They are considered secure bonds because they are associated with collateral, mostly a property. Furthermore, covered bonds are regulated by law through the Covered Bonds Act ([Pfandbriefgesetz] (PfandBG)).
The refinancing process of mortgage financing can roughly be divided into the following steps:

[*]The customer approaches the bank and wants to conclude a mortgage financing.
[*]The bank borrows the money for the mortgage financing from investors on the capital market. For this purpose, it issues covered bonds to the investors. The collateral consists either of properties owned by the bank itself or the rights to the properties of its mortgage clients.
[*]In return for their investment, the investors receive interest and the right to realize the property in case of payment defaults.
[*]The bank passes the money on to the customer as the loan amount for their mortgage financing.

The interest rate that the bank has to pay the investor for the borrowed money, called the covered bond interest rate, is passed on to the customer with a small margin. The customer pays back the loan with interest to the bank over many years.
Thus, the bank fulfills its obligations to the investor and simultaneously achieves an economic profit. Mortgage interest rates therefore depend directly on the level of the covered bond interest rate. The key interest rate, on the other hand, has no direct influence on mortgage interest rates.