Interest rates for new home loans in the euro zone continued to fall in February although other household borrowing costs rose, European Central Bank figures showed today.
The average rate charged for mortgages fixed for more than five and up to 10 years fell for the sixth month in a row to 4.39 per cent, the cheapest since ECB records began in January 2003.
Rates for other types of home loan were all cheaper than they were six months ago, with rates on loans fixed for more than 10 years down to 4.33 per cent. ECB policymakers have expressed concern that cheap loans and fast credit growth could fuel unsustainable house price rises in some euro zone countries.
Mortgage lending grew by 10.1 per cent in February. But interest rates on household bank overdrafts and some other personal loans rose, with a loan for consumption fixed for more than one and up to five years now costing 6.84 per cent interest. Business borrowing costs were mixed.
Loans of more than one million euros to non-financial corporation with rates fixed for more than one and up to five years rose to 3.34 per cent, while the same amount borrowed over more than five years cost 3.82 per cent, compared to 4.08 per cent in January.