What is happening with interest rates, why, and what can you do?

What is happening with interest rates?

Interest rates rise and fall, we have been in a secular-ZIRP (zero interest rate policy) environment for quite some time and as people who subscribe to the monetarist school of thought, this would always lead to inflation which we are seeing now, albeit a fairly delayed response given how long this policy has been in place.

Why?

Not too long ago the yield curve was negative 20 years into the future such was the dismal outlook of markets for any level of inflation, but then you had a pandemic, the ‘great resignation’ and between labor and supply constraints along with monetary policy effects, there is inflation you haven’t seen in 40 years. Now the curve is negative only one year into the future and the price in the money markets has risen.

Just to clarify this, many mortgage providers get their money by buying it (you buy at X + interest rate and then ‘sell’ it to borrowers at X+margin [which is ideally above the price you bought it at]). In an oversimplified manner, …

Read More

Irish Mortgage Brokers featured in the Irish Times

We were mentioned in the Irish Times in a piece by Cliff Taylor about the increase in the number of people seeking to refinance their home.

Rather than a fear of higher interest rates, Karl Deeter, of Irish Mortgage Brokers, believes it is primarily driven by people facing tightening (link to article here)

The crux of the point being made is that as inflation is affecting people and rates look set to rise that it is naturally driving people to consider ways to get better prices on one of their biggest outgoings and to get some assurance on what the price levels of their outgoings will be.

Read More

History of the Landesbank (Bavaria)

In Germany, Landesbanken are credit institutions that carry out banking transactions for individual federal states and support the state in promoting the economy.

The history of the legal predecessors of today’s Landesbanken often dates back to the 18th century. In their now familiar form, the banks emerged in the years after World War II, when the German states issued their first state bonds with the help of the Landesbanken. In the respective federal state for which they carry out banking transactions and act in an advisory capacity, they perform a kind of house bank function. In addition, the Landesbanken are authorized to conduct all banking transactions permitted under their statutes. In this respect, they have been operating on the market for years as general commercial or universal banks.

The business model of the Landesbanken has faced a dilemma since the abolition of institutional burden and guarantor liability in 2005; on the one hand, they conduct banking business for their federal state, but on the other hand, they are on a par with private banks and have to hold their own …

Read More

The economy of Nuremberg

Nuremberg is the second-largest city in Bavaria after Munich. According to the population register in December 2021 530,222 people had a registered main residence in Nuremberg. Within the last two Corona years, Nuremberg’s population has thus declined by 1.1%. The main reason for this is the Corona pandemic. Since October 2021, the number of inhabitants has been increasing significantly again. According to the Nuremberg and Fürth Statistical Information System, about 32.000 people moved away from Nuremberg in the year 2021.

Nuremberg was ranked among the top 25 cities with the best quality of life worldwide in a study (Worldwide Quality of Living Survey) conducted by the consulting firm Mercer, and was ranked sixth among German cities in 2010.

The overall quality of living and satisfaction of the population is continually determined every three years in most German cities. The last survey took place in 2019 with over 1,000 participants. More than 80% of all attendees from Nuremberg were satisfied with the public areas such as markets, squares, and pedestrian zones in their city. The condition of roads and buildings as …

Read More

The Frankfurt property market (Germany)

Frankfurt am Main is growing – as a stable business location, internationally important financial centre and European transportation hub. The largest city in Hesse attracts numerous young workers, older financially strong couples, but also foreign customers. For several years now, Frankfurt am Main has been one of the cities in Germany with the highest population growth. Since 2014, the number of inhabitants has risen by 7.1 per cent to almost 760,000. Given their economic importance, mass migration and associated housing demand are unlikely to decline in the foreseeable future.

Frankfurt am Main is also one of the nationwide leaders when it comes to vacancy rates for residential properties. The Main metropolis has a vacancy rate of only 0. 3 per cent, which is ahead of the already low figures in Stuttgart (0. 5 %), Hamburg (0. 5 %) and Berlin (0. 8 %). The continuing excess demand for housing in Frankfurt am Main has led to a steady rise in the average rent in the Main metropolis for years. However, a distinction must be made here between existing …

Read More

German mortgages explained

In the legal sense, a mortgage is the right with which a bank or building society secures a mortgage loan. The mortgage secures a plot of land with or without buildings. It is one of the liens on real property and is regulated in the German Civil Code (Section 1113 BGB).

If the builder fails to meet his obligations under the loan agreement, the bank can apply for foreclosure. It can use the proceeds from this to repay the construction loan. Usually, you can only cover a part of the purchase price of your desired property with your own funds. The greater part is financed by a mortgage. This means a loan from a bank, which is secured by the property. How to get a mortgage in Germany

Let your customer advisor advise you on all aspects of real estate purchase. There are various contact points in Germany for this purpose. Depending on your life situation, it is appropriate to first contact the house bank. Various financing proposals are measured by how good the customer’s liquidity is.

After the financing …

Read More

How to win a bidding war on a house

So, you’ve found your perfect home. The only problem is that the home that is perfect for you also happens to be perfect for several other buyers. In markets with high demand and low inventory, also known as seller’s markets, bidding wars can be quite commonplace. And because of already increasing demand, combined with a year-long halt in construction due to the pandemic, Ireland is in a seller’s market right now. This means that many houses will have multiple buyers attracted to the property, which can hurt your chances of securing the home of your dreams. In this blog, we’ll consider some strategies to ensure you walk away with your dream home

Make the highest offer

The most obvious way to win a bidding war is to simply make the highest offer.  Because the seller is usually trying to make as much money as possible, the highest offer usually holds a lot of weight. So, if you can scrape together some extra cash to outbid the competition, you will most likely be the top choice of the seller. However, under …

Read More

4 Economic Ways to Secure your Home

 

 

With COVID-19 still part of our daily life, people in Ireland are spending a lot of time at home. Because of the stay-at-home recommendations, many people are suddenly trying to find new ways of securing their homes. As compared to the past, smart home technology and artificial intelligence are changing the home security market. Regardless of the fancy models in currently in the market, there are some affordable and easy ways to secure your home. 

Secure your doors

Close to 40 percent of burglars enter a home through the front door. Because of this reason, always ensure that your exterior doors are properly inspected to know whether the hinges are protected or if the frames are strong enough. If the home you move to was occupied by someone else before, ensure that you change the locks so that any key previously used can be rendered useless. Lastly, you could install deadbolts, use a video doorbell, install smart locks or add a strike plate.

Lock the Windows

Windows are also entry points which can allow burglars gain access to …

Read More

What you Need to Know About Getting a Mortgage while on a Contract

 

Contractors account for 8% of all workers in Ireland, according to various sources. The appeal is understandable: you have more freedom in terms of what jobs you take on, your hours are much more fluid, and you may be able to accumulate more income which is dictated by the field you engage in.

If you’re a contractor seeking to purchase a home, you might be wondering if you’ll be able to get a loan. The quick answer is yes, however obtaining a loan may be more difficult. You may not even have regular and constant pay stubs to demonstrate evidence of stable income, unlike a normal wage job. It might be difficult to track your pay when you work on a contractual basis, making it more difficult to explain your financial status to your creditor.

 Know your budget.

You must first determine your budget before beginning the mortgage application procedure. In order for to do that, y You’ll need to consider how much of an investment you can manage as well as your repayment ability. When determining how much you …

Read More

All you Need to Know about a Credit Score in Ireland

 

Having a good knowledge about your credit score and the contents of your credit report is very important since you are able to clearly understand the factors that may impact your score when getting a mortgage to buy a home. With the report, you get an overview of the things you are doing right and the parts you should change so that you can increase your credit score. 

Factors that determine your credit score

Your credit including a mortgage, car loans, store credit cards, and a mortgage affect your credit score. Additionally, the credit that you are using affects your score. In this case too much use of the available credit reduces your credit score. The third factor is late repayment since it stays in the report for a lot of time. Sometimes there can be some error in the credit report but this can be fixed within a day. Therefore, before going to a lender for a mortgage, you need to ensure that the report is up to date. If you discover an error, file a dispute with …

Read More