Mortgages, how much my house costs me! In Italy the highest rates in Europe


By John

«Record mortgage rates in Italy: compared to the main European countries, Italian banks offer the worst conditions on loans for the purchase of homes. With an average rate of 4.23%, our country has the highest level practiced by credit institutions in Europe”. It is written in a note An undertaking.

Definitely more favorable conditions, however, are found outside our borders, considering that in Italy there is a difference of 52 basis points compared to Germany and Spain (3.71%), 135 points compared to France (2.88% ), by 37 points compared to Austria (3.86%) and by 9 points compared to Portugal (4.14%). This is what emerges from a document from the Unimpresa Study Center, according to which if in 2021, Germany, Spain and France recorded rates close to the Italian ones, the same did not occur starting from 2022: while in Italy the year last year an average rate of 3.34% was applied, in Spain 2.91% was sufficient and in France even 2.05% with a gap of 129 basis points.

«High rates slow down the real estate market and this has inevitable repercussions on the entire Italian economy, increasing imbalances in the eurozone. The data says that those who today ask for a mortgage to buy a house within our borders find the worst conditions in the euro area. – continues Unimpresa – In the last two years this was not the case. In 2021, in our country, a house was purchased with a mortgage at an average rate of 1.40%, practically under the same conditions as in other countries of the Old Continent. Just two years later, however, a gap was created which does not seem to find any justification in market logic nor in terms of risks, which have remained unchanged. Indeed: if you look at the economic situation, Italy’s economic growth in these two years has been higher than that of the other large European markets” comments the vice-president of Unimpresa, Giuseppe Spadafora.

According to the Study Center of An undertakingwhich processed data from the European Central Bank – last May in Italy the average rate on new mortgages stood at 4.23%, the highest among the main eurozone countries: in Germany and Spain it was at 3.71% with a spread of 52 basis points, in France at 2.88% with a gap of 135 basis points, in Austria at 3.86% with a spread of 37 points and in Portugal at 4.14% with a gap of 9 points.

In 2021, there was a substantial alignment in the conditions practiced by banks for real estate credit: in Italy the average rate was 1.40%: only 8 basis points higher than in Germany (1.32%), 2 basis points compared to Spain (1.38%), by 30 basis points compared to France (1.10%), by 18 basis points compared to Austria (1.22%) and by 60 basis points compared to Portugal (0. 80%). In 2022, then, a first enlargement occurred, coinciding with the monetary tightening in the euro area: in Italy the average rate was 3.34%, while in Germany it was 3.52% (-18 basis points) , in Spain at 2.91% (+43 basis points), in France at 2.05% (+129 basis points), in Austria at 2.86% (+48 basis points), in Portugal at 3.30% (+4 basis points).

«It is complex – observe the analysts of the Unimpresa Study Center – to identify the reasons for these anomalous spreads on home mortgage rates in Europe. The explanations undoubtedly do not lie in credit risk parameters. If we look in particular at the comparison with Germany, last year Italian banks offered more convenient mortgage conditions than their German competition: 3.34% versus 3.52%. In the space of a few months, during which the Central Bank brought the cost of money from zero to 4.25%, everything was reversed with the spread of 18 points favorable to Italy now in negative territory by 52 points”.