“When is it delicious to start buying a house? Pick up the mortgage now, or later? “Maybe this question is always spinning in the head when I want to decide to have a dreamed dwelling.
There are many ways to own a home. For those who have a lot of money, maybe that’s not hard to get. But how the finances were mediocre? Of course the choice is by way of credit.
But, we all know that there are many that are usually considered to decide when is the right time to buy a home by mortgage (Home Ownership Credit). Remember, for years we will bear the mortgage payments and interest costs.
For that, knowing the credit interest rate from the beginning and forecast in the future is very important. And what kind of mortgage interest trend is also highly dependent or affected from the interest rate of Indonesia’s central bank (BI 7-Day Repo Rate).
Then, What’s Like Estimated Rate of Credit Interest Throughout 2018?
Before proceeding to the credit interest forecast this year in order to decide whether to take a mortgage or not, consider how the prospects of the Bank of Indonesia (BI) 7-Day Repo Rate rate in 2018 first.
This is important, because the interest rate set by BI is a reference of interest banking, namely credit interest and deposit interest. Well, this mortgage interest is closely related to banking services, is not it?
Latest, February 15, 2018, BI has decided the interest rate 7 Day Repo Rate remained at the level of 4.25%. This figure is maintained since September 2017, down 100 basis points (bps) from August 2016 which remained at 5.25%, the first time the determination of BI reference rate using BI 7-Day Repo Rate from previous is BI Rate.
Meanwhile, with the BI interest rate, in the last year, bank credit interest such as mortgages for example, an average of about 11-12% per year.
According to Akhmad Akbar Susamto, Economist of Center for Reform on Economics (CORE) Indonesia, Cermati.com said that there is no possibility of BI rate hike this year. At least, there are four things that can affect the change in BI interest rate, namely inflation conditions, current account balance, external conditions, especially the policy of the Federal Reserve, and domestic economic growth.
He estimates, until the first half of this year BI rate 7-Day Repo Rate will still survive at 4.25% and will increase at the end of this year.
However, the magnitude of the increase is expected to be relatively small. Even so, whether or not the rise in interest rates still depends on external factors, namely the plan of Fed Fund Rate increase.
However, for the potential BI interest rate to decline this year, according to him, it is very unlikely, because the interest rate of Indonesia’s central bank is now quite low.
What Influence of BI Rate Interest Rate with Banking Credit Interest?
Yup, between the interest rate set in BI with the interest rate of banking credit is very closely related. Because after all, whether banking, money market, or real sector, in transactional refers to monetary operations conducted BI.
Thus, it is clear that the role of BI as a guard institution of monetary stability and financial system also aims to avoid the prevention of problems that potentially arise in the bank. So the banking system refers to the central bank of Indonesia in transaction or trade.
So, it is not surprising that the interest on time deposits and bank credit interest can change anytime, because it follows the movement of the central bank’s benchmark interest rate, which currently uses BI 7-Day Repo Rate as a new policy to strengthen the monetary operation framework.
The higher the BI interest rate, the higher the credit interest and deposit. Vice versa, if the interest rate BI down, then the interest on credit and deposits will also follow.
Previously, the central bank’s benchmark interest rate was based on the BI Rate. However, as of August 19, 2016 the Indonesian central bank decided to change to the BI 7-Day Repo Rate as its benchmark interest rate. The hope is that the new BI interest rate will allow its policy rate to affect the money market, banking and real sector more quickly.
Because we know, so far the tendency of banking interest (credit and deposit) is difficult to go down even though BI rate has been lowered. Although in the end credit interest fell, but the decline was very slow. This does not necessarily adjust the BI rate cut.
Well, in the period of the last year, with the BI interest rate, the interest of bank credit in Indonesia is in the range above 10% average for mortgage interest. asuransi pendidikan prudential
The mortgage interest rate gradually decreased from the previous years which had reached about 11-12% in 2014, even much lower than the mortgage interest rate in 2005 which was once above 16%.
That is, if you see the movement of BI interest rate during this time, and the projection of interest rate potential in the next year, then the mortgage interest rate in 2018 is estimated to be still relatively equal to the year 2017 which is in the range of 10%, despite the possibility of BI rate 7 -Day Repo Rate.
Although there are some banks that offer single-digit mortgage rates, but that is not the number that applies forever. But in a certain period of time as a promotion for an average of about 2-5 years only.
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