MADRID: The Bank of Spain has confirmed this Monday that the Euribor, the index by which the largest number of mortgages in Spain are calculated, has concluded the month of May at a record low of 0.165%. This Euribor borrowing rate hits another record lowcompares to a level of 0.180% a month ago, and during the last year, the index has dropped by 0.427 points.
In late 2008 the Euribor rate peaked at 5.393%, so those with mortgages facing review of their rates at the end of May will see a considerable difference in the size of their repayments from 2008, when house prices were also at a peak. Homeowners with a 120,000 euro mortgage over a period of 20 years can expect to save 280 euros per year or 23.39 euros per month on their payments in 2014 based on this new rate.
It seems that the Euribor is set to continue at very low levels for the foreseeable future, which will provide good conditions for the property market as banks compete with one another to attract lending customers. British buyers are in an especially good position to take advantage of favourable repayment terms given the current strength of the pound, which was trading at 1.40€ last week: in late 2008 the two currencies almost reached a state of parity.
