I talked with them when shopping around and the rates were competitive, even before these starter and energy-efficient offers.
Think about shopping online. I bet marketing people have a term for this.
For a flight or hotel room: You get teased by offers like “your desired location starting at 99,-“. Once you add your details, you end up at 299,-. Plus luggage and a convenience fee for booking online.
A toy: MSRP “99,-“. You might find the same thing for 79,- incl. shipping somewhere, or -59,- at a sale or using some discount.
ZKB’s published rates follow approach 2). At least they publish something, and you’d have to consider these rates minus your offered and then negotiated personal discount.
In both cases, you should go through the ordeal to get, compare and negotiate a personal offer.
It does appear like some lenders raised margins on the fixed rates too. The swap rates are lower now than in august, yet the fixed rates seem to be the same.
(therefore it seems lenders increased fixed margin of about 0.1 - 0.2% as shown in the graph).
“Basel III is leading to an increase in interest rates for some mortgage lenders”
“In addition, some lenders are currently a little less aggressive because they have already achieved their targets for 2024”
It seems to align well with my experience where SARON margins of 0.5-0.6 have been very hard to find in the past few months, and they are closer to 0.7-0.8 now.
“In addition, some lenders are currently a little less aggressive because they have already achieved their targets for 2024”
I’ve been explicitly told the same by multiple banks. They didn’t actually seem interested in my business.
The rate I got offered for a 10-year is between -0.05% and -0.10% worse than the starting range at Moneypark or Hypotheke. Better, if compared to the starter or environmental bonus.
Not sure whether I could negotiate more, or these rates are reserved for different financials. We already worked part-time when applying for a 80% loan, and the affordability calculation was tight.
That would include to change main bank accounts (which are free by now) and open 3a for indirect amortization at ZKB or Frankly.
Of course, they advertised their asset management and other services, but that wasn’t a requirement.
A big, universal bank offered a similar rate on the 10-year one, but asked for transferring assets to their solution for a better deal on Saron (0.5% margin back then).
This may be a very basic question, but can someone here please explain to me why banks anticipate an increase in interest rates for 10y fixed mortgages in December 2024, although the SNB is expected to lower the “policy rate” mid-December? Shouldn’t the mortgage interest rates for all durations go down in parallel to the SNB’s rate?
Not becessarily, the yield curve is upward sloping normally (and it has normalized for longer durations). Meaning longer terms have higher interest/yield, as you are taking term risk, and market participants demand to be comepsated for said term/duration risk.
The current curve already prices in future policy rate developments. But further out than a few years you‘ll generally have a different dynamic.
@Tony1337, Thanks a lot! However, the logic does not seem entirely clear to me. What sentiment would drive the yield curve for 10y higher than where it is right now? That’s what the banks like UBS or ZKB appear to forecast for December 2024…
Trump policy with is likely to drive long-term inflation higher and as the world is globalised it could impact Switzerland?
Anyway it’s on their interest to say that the 10y will increase. Most of their forecast are wrong and just act on their interest to sell what they want…
The only thermometer I use is 10y gov yield and IRS of various duration(1,3,5 and 10)
There are lots of factors that play a role here.
Future expectations for short term rates do play a role. Future expectations for Inflation as well.
The best guess on what’s happening is the current 10 year swiss government bond yield though, as that is the market consesus. ZKB/UBS are just guessing and won’t know more than the market.
@HoiZame, Interesting! What would you recommend to someone having a bit of time flexibility and considering a 10y fixed: secure it at ~1.25% now, or wait until the SNB’s decision in December?
Sorry I cannot. On https://www.hypotheke.ch/ they advertise 1.31 these days so I guess negotiating to get the 6 bp to reach 1.25 should not be too difficult.
I guess market is pricing in a 25 bp decrease in December and March. A 50 bp decrease in december could lead to further decrease but the only question you should ask yourself is whether a 1.25 fixing makes you happy. Of course it could go lower but you never know what’s going to happen.
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