MADEIRA PROPERTY - REAL ESTATE - BANK INTEREST RATES DROP
The recent bank interest rate drop announced by major banking institutions in Madeira Island, Portugal will have no or very little effect on the local economy. The Central European bank has virtually commanded local banks to reduce their interest rates to an all time low. Although the interest rates are now very low, consumers have to be very cautious as in real terms; money is still expensive as the banks have simultaneously increased their profit margin – namely the “spread” percentage. Demand for credit has not increased as it is still perceived to be too expensive; companies with liquidity problems also do not qualify.
According to statistics undertaken by INE (Local National Statistics Institution), during the first six months of 2008, 7093 companies were declared insolvent – a 51% increase when compared to the first half of 2007. Consumers are urged to read the small print very, very carefully when applying for finance in Portugal, including mortgage finance.
We would like to inform those who are serious about buying property in Madeira now that we work with serious sellers of properties in Madeira – some of whom hold a mortgage-free title who are looking for serious offers and are prepared to “listen” to the market.
Feel free to consult our property portfolio to obtain an idea of some of the asking prices of property in Madeira Island or email us for further information.