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Česká spořitelna and ČSOB, two banks with a significant market share, have announced increases in their mortgage rates, citing the rising cost of resources as well as the increase in interest rates by the Czech National Bank. Photo: ZM / Brno Daily.

Czech Rep., Sep 5 (BD) – Two major Czech banks are raising their mortgage rates. Česká spořitelna (ČS) raised their rates effective from Thursday, with ČSOB to follow from Monday, September 13th. According to the banks, the increases are not only due to the increase in interest rates by the Czech National Bank (CNB) but also the rising cost of resources. Filip Belant from ČS told Právo that, “The era of low interest rates on mortgages is coming to an end, and in the coming months we expect that the rate of housing loans and real estate prices will gradually increase.”

ČS has increased the interest rates on mortgages by 0.2 percentage points. Five- and eight-year mortgages of up to 80% will now start at 2.74 percent per year. The bank’s shortest fixed-rate mortgages of one year will be charged at 3.34 percent, and the longest, for 20 years, at 3.44 percent per year. ČSOB will also increase rates by 0.2 points. Five- and seven-year fixed rate 80% mortgages will now be set at 2.79 percent, one- and three-year at 2.69 percent, and ten-year at 3.09 percent. 

Following a relaxation in mortgage rules by the CNB last year, banks are also providing 90% mortgages, for which clients only have to provide 10% of the capital. These mortgages must be charged at rates exceeding 3%; ČSOB offers a rate of 3.29% per year for fixed five and seven year mortgages of this kind.

Analysts expect that the announcement of rising prices from these two banks will lead other mortgage providers to follow suit. “Interest rates will rise this year as the CNB raises key interest rates,” said Miroslav Zámečník, principal advisor to the Czech Banking Association, speaking to Právo. “Increases in the average mortgage rate have remained below 0.1 percentage points per month in recent months. However, it cannot be ruled out that the average rate for new mortgages could reach 3% by the end of the year.”

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https://brnodaily.com/wp-content/uploads/2020/02/czech-national-bank-prague-July-2-Zenon-Moreau-2-1024x682.jpghttps://brnodaily.com/wp-content/uploads/2020/02/czech-national-bank-prague-July-2-Zenon-Moreau-2-150x100.jpgBD StaffBusinessCzech Republic / WorldBusiness,Czech RepublicČeská spořitelna and ČSOB, two banks with a significant market share, have announced increases in their mortgage rates, citing the rising cost of resources as well as the increase in interest rates by the Czech National Bank. Photo: ZM / Brno Daily.Czech Rep., Sep 5 (BD) – Two major Czech...English News and Events in Brno