Interest rates will always be cyclical!

But, being tied to the ECB gives us the comfort of knowing that the European mainland does not have a historical tolerance for sustained high rates.

The ECB rate is predicted to rise to 3.4%, with a downward trajectory in 2025 to below 3%.

Having a fixed rate is good in the sense that it gives the mortgage holder the comfort of being able to predict their monthly outgoings. But there are disadvantages! If you are looking for much more flexibility, then a variable rate is the one for you.

For example, if one finds themselves with a higher disposable income, they can increase their monthly repayment and thus reduce their mortgage term, or if they find themselves with a lump sum, putting this against the mortgage can either reduce the monthly payment or reduce the mortgage term.

So, before making a decision, weigh up the pros and cons and speak to your mortgage adviser.

If you have any questions, please reach out to me!