On March 9 – three weeks ago – the target rate for a 10-year mortgage stood at a record low of 0.98 percent. The pandemic and the concern about the economy have since put paid to the decline of mortgage rates.

By the end of March, the rate had increased by a fifth to 1.17 percent, internet comparison service Comparis reported. The spread between the rate paid for a 10-year and a 5-year mortgage widened over the same period, suggesting that lenders have become concerned about long-term risks.

More Expensive Refinancing

«The marked increase of rates is also a consequence of higher refinancing costs,» said Frédéric Papp, an expert in finance at Comparis, according to the statement released on Wednesday.

Even though central banks have been pumping liquidity into the market and some have cut their leading rates, refinancing has become more expensive. The banks are now passing on the increase in cost to mortgage takers.