If there is one topic holding sway in economic conversations today, it is certainly inflation. Surprisingly, however, we are seeing an unexpected trend: downward inflation. While this might raise a few eyebrows among economists, for those thinking of buying a home, it could prove to be an exceptional time to plan a real estate mortgage.
Inflation in Italy fell to 0.8 percent, while in the euro area it fell to 2.4 percent. The decrease is mainly attributed to energy prices, which fell significantly.
The NIC index with tobacco recorded a monthly decrease of 0.4 percent and an annual increase of 0.8 percent, the lowest since March 2021. (Data taken from https://www.ilsole24ore.com/)
The deflation is mainly attributed to energy prices, both regulated and unregulated, and the slowdown in some sectors such as processed food, recreational, cultural and personal care services, and transportation-related services. Rising unprocessed food prices partly offset this.
Annual inflation in the euro area continued to decline, reaching 2.4 percent in November compared to an estimated 2.8 percent.
The categories with the highest rate are food, alcohol and tobacco with 6.9 percent.
Excluding energy, annual inflation in November was 4.3 percent.
Bank of Italy Governor Panetta, in proclaiming the reduction of inflation as a useful element for economic recovery, hopes that as this continues, the possibility of a rate cut by the ECB could be opened.
The phenomenon of falling inflation is also seen in the rest of Europe, where it stands at 2.4 percent.
So for those who dream of owning their own home, downward inflation may be an unexpected ally for the following reasons:
Downward Interest Rate Trends
When economic inflation is under control, central banks often keep interest rates low to stimulate economic growth. This results in more favorable conditions for obtaining a housing loan at lower interest rates.
Improved Buying Power
With moderate inflation, purchasing power remains more stable over time. This means that savings and per capita income retain real value, allowing you to deal with the expenses associated with buying a home more effectively and thoughtfully.
Real estate investment opportunities
In conclusion, it seems obvious that returning to a low level of inflation provides a favorable environment for those who wish to enter the real estate market by taking out a mortgage. Taking advantage of lower interest rates and favorable market conditions may be the key to realizing the dream of owning your own home.
Therefore, if you are thinking of starting on the path to your ideal home, contact us. We are here to help you make the most of the opportunities offered by these unique economic times. Now, the realization of your dream may be easier than you can imagine!
