Buying dilemma - 3-bed mid terrace

[jmurphy]

Considering the recent updates regarding interest rates and so on, we were wondering if it makes sense to purchase a house right now. This is a 3-bed mid terrace house in a good area. It's A-rated and listed for €600,000. The annual management fee is €1500 p/a.

Assuming the interest rates will go up in June/July, how long does it usually take to impact the mortgage rates and eventually housing prices?

 

[_OkGo_]

What exactly is your dilemma??

From your other thread, you have:

Summary of Assets and Liabilities
Family home worth €400k with a €200k mortgage
Cash of €100k
Defined Contribution pension fund: 0
Company shares : €150k

So you could buy this new property, sell your current PPR, use your cash & shares and have a very small mortgage of €150-200k relative to your high income of €160k. I don't see any dilemma in that.

Assuming the interest rates will go up in June/July, how long does it usually take to impact the mortgage rates and eventually housing prices?

Well some providers (Avant & ICS) have already announced increased rates in advance of ECB rate increases so you could say it is already taking effect. But it is anyone's guess how/when the rest will follow.

Your current mortgage is at 2.9%. If you buy the new property in the near future, you should still be able to get a good fixed rate below 2.5% for a decent period (5-7 years).

In the greater scheme of things, interest rates are not your biggest concern. You have the low risk option of buying the PPR you want/need or the high risk option of keeping both properties. With 2 mortgages and a lot of debt, interest rates will squeeze you. The interest rate is only a risk to you depending on whether you choose to take on a lot more debt or not