After a period of record-low mortgage interest rates, the cost of mortgage borrowing in Germany surged in 2022. In 2019, mortgage rates declined notably, falling as low as 1.16 percent in December 2020. This downward trend reversed in 2021, as mortgage rates started to gradually pick up. Five-to-ten-year mortgage loans had the lowest rates in October 2023 at 3.85 percent, while floating rate mortgages up to one year were the most expensive at 5.53 percent. Mortgages with over 10-year fixed period – the most popular loan type among homebuyers - had an interest rate of 3.9 percent.

Why did mortgage rates in Germany increase?

In 2022, the yearly inflation rate in Germany experienced a swift rise, prompting the central bank to raise interest rates to counter this surge. The European Central Bank (ECB) is responsible for determining Germany's central bank interest rate. In July 2022, following a prolonged period of stability, the average interest rates in Germany began a steady rise, which persisted consistently thereafter.  This increase is intended to stabilize prices, but it also means higher borrowing costs for those seeking mortgages.

Downturn in Germany's home loan borrowing

From 2022 onward, the gross residential mortgage lending in Germany fell dramatically. Besides the higher interest rates, the downturn can be explained by the slowed pace of economic growth, which makes individuals and businesses more cautious about big investments such as buying a home. Additionally, the German housing market suffers a chronic undersupply, meaning that homebuyers often struggle to find an affordable home to purchase.

The mortgage interest rate in Germany decreased notably between 2013 and 2022, falling below 1.5 percent. This was part of an overall trend of falling mortgage interest rates in Europe. The mortgage interest rate in Germany has since increased to 3.9 percent in the second quarter of 2024. The German mortgage market In Europe, Germany is the second-largest mortgage market, with a total value of mortgages outstanding amounting to over 1.8 trillion euros. Mortgage loans are one of the oldest bank products. Among the factors that influence mortgage interest rates are inflation, economic growth, monetary policies, the bond market, the stability of lenders, and the overall conditions of the housing market. Mortgage loans The higher cost of borrowing has a significant effect on the market: While the interest rates were at their lowest, mortgage lending was on the rise. In 2023, when the rates reached a 10-year-high, the quarterly gross mortgage lending fell to the lowest value since 2014. Meanwhile, house prices have also increased substantially in recent years. According to the House Price Index in Germany, between 2015 and 2022, house prices increased by over 60 percent.

Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 9 Years data was reported at 2.910 % pa in Feb 2025. This records a decrease from the previous number of 3.020 % pa for Jan 2025. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 9 Years data is updated monthly, averaging 3.230 % pa from Jan 2000 (Median) to Feb 2025, with 302 observations. The data reached an all-time high of 6.010 % pa in Jan 2000 and a record low of -0.230 % pa in Aug 2019. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 9 Years data remains active status in CEIC and is reported by Deutsche Bundesbank. The data is categorized under Global Database’s Germany – Table DE.M016: Mortgage & Public Bonds: Rate.

The annual average interest rate on new residential loans in Germany generally decreased between 2007 and 2023, with some fluctuation. It declined from 5.09 percent in 2007 to 1.26 percent in 2021. In 2023, it significantly rose to four percent, the highest rate recorded since 2010. Nevertheless, this rate varied for different loan types, with floating mortgage rates being the most expensive as of October 2023.

Key information about Germany Long Term Interest Rate

• Germany Long Term Interest Rate: Month Avg: Germany: ECB Harmonised was reported at 2.18 % pa in Dec 2024, compared with 2.31 % pa in the previous month.
• Germany Long Term Interest Rate data is updated monthly, available from Jan 1990 to Dec 2024.
• The data reached an all-time high of 9.09 % pa in Oct 1990 and a record low of -0.65 % pa in Aug 2019.
• Long Term Interest Rate is reported by reported by CEIC Data.

• In the latest reports, Germany Short Term Interest Rate: Month End: EURIBOR: 3 Months was reported at -0.57 % pa in Nov 2021.
• The cash rate (Policy Rate: Month End: Main Refinancing Operations) was set at 3.15 % pa in Dec 2024.
• Germany Exchange Rate against USD averaged 0.92 (USD/EUR) in Jun 2023.

The benchmark interest rate in Germany was last recorded at 4.50 percent. This dataset provides - Germany Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 8 Years data was reported at 2.970 % pa in Jan 2025. This records an increase from the previous number of 2.940 % pa for Dec 2024. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 8 Years data is updated monthly, averaging 3.150 % pa from Jan 2000 (Median) to Jan 2025, with 301 observations. The data reached an all-time high of 5.920 % pa in Aug 2000 and a record low of -0.280 % pa in Aug 2019. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 8 Years data remains active status in CEIC and is reported by Deutsche Bundesbank. The data is categorized under Global Database’s Germany – Table DE.M016: Mortgage & Public Bonds: Rate.

Residential mortgage lending in Germany plummeted in 2022, amid an increase in mortgage rates. With interest rates gradually increasing as a response to the rising inflation, the mortgage market has cooled: In October 2023, the value of new mortgage loans stood at about 14 billion euros, down from almost 23 billion euros two years ago. During the observation period, 10-year fixed rate mortgages accounted for nearly half of mortgage lending, followed by 5 to 10 year fixed rate mortgages. More information on the Mortgage market in Western European countries can be found here.

Key information about Germany Bank Lending Rate

• Germany Bank Lending Rate was reported at 4.640 % pa in Jan 2025.
• This records a decrease from the previous number of 4.880 % pa for Dec 2024.
• Germany Bank Lending Rate data is updated monthly, averaging 3.340 % pa from Jan 2003 to Jan 2025, with 265 observations.
• The data reached an all-time high of 6.550 % pa in Dec 2007 and a record low of 1.760 % pa in Oct 2021.
• Germany Bank Lending Rate data remains active status in CEIC and is reported by CEIC Data.
• The data is categorized under World Trend Plus’s Global Economic Monitor – Table: Bank Lending Rate: Monthly.

Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 2 Years data was reported at 2.620 % pa in Jan 2025. This records an increase from the previous number of 2.580 % pa for Dec 2024. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 2 Years data is updated monthly, averaging 2.180 % pa from Jan 2000 (Median) to Jan 2025, with 301 observations. The data reached an all-time high of 5.560 % pa in Jul 2000 and a record low of -0.450 % pa in Aug 2019. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 2 Years data remains active status in CEIC and is reported by Deutsche Bundesbank. The data is categorized under Global Database’s Germany – Table DE.M016: Mortgage & Public Bonds: Rate.

The average mortgage interest rate decreased in nearly every country in Europe between 2012 and 2021, followed by an increase in response to inflation. In Hungary, Poland, Czechia, and Romania, mortgage rates peaked in late 2022 and the beginning of 2023, followed by a gradual decline until the first quarter of 2024. The rest of the countries under observation, including the biggest mortgage markets - the UK and Germany, saw a continued increase in interest rates until the fourth quarter of 2023. In the first quarter of 2024, mortgage interest rates declined quarter-on-quarter across almost all markets in focus, marking a long awaited easing of monetary policy.

Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 15 Years data was reported at 3.130 % pa in Feb 2025. This records a decrease from the previous number of 3.210 % pa for Jan 2025. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 15 Years data is updated monthly, averaging 3.600 % pa from Jan 2000 (Median) to Feb 2025, with 302 observations. The data reached an all-time high of 6.370 % pa in Jan 2000 and a record low of 0.070 % pa in Aug 2019. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 15 Years data remains active status in CEIC and is reported by Deutsche Bundesbank. The data is categorized under Global Database’s Germany – Table DE.M016: Mortgage & Public Bonds: Rate.

The total amount of outstanding residential mortgage lending in Germany grew quarterly since the second quarter of 2014. This value increased to nearly 1.9 trillion euros by the second quarter of 2024. Along with the United Kingdom and France, Germany was one of three European countries that exceeded one trillion in outstanding residential mortgage lending.

The table below showcases the 10th, 25th, 50th, 75th, and 90th percentiles of mortgage rates for each zip code in New Germany, Minnesota. It's important to understand that mortgage rates can vary greatly and can change yearly.

The rate of home owners with a mortgage or loan in Germany fluctuated between 2010 and 2021. It can be seen that 28 percent of German households had a mortgage in 2021. This was an decrease from the previous year, when 31 percent of households had a mortgage loan.

Mortgage interest rates worldwide varied greatly in 2024, from less than four percent in many European countries, to as high as 44 percent in Turkey. The average mortgage rate in a country depends on the central bank's base lending rate and macroeconomic indicators such as inflation and forecast economic growth. Since 2022, inflationary pressures have led to rapid increase in mortgage interest rates. Which are the leading mortgage markets? An easy way to estimate the importance of the mortgage sector in each country is by comparing household debt depth, or the ratio of the debt held by households compared to the county's GDP. In 2023, Switzerland, Australia, and Canada had some of the highest household debt to GDP ratios worldwide. While this indicator shows the size of the sector relative to the country’s economy, the value of mortgages outstanding allows to compare the market size in different countries. In Europe, for instance, the United Kingdom, Germany, and France were the largest mortgage markets by outstanding mortgage lending. Mortgage lending trends in the U.S. In the United States, new mortgage lending soared in 2021. This was largely due to the growth of new refinance loans that allow homeowners to renegotiate their mortgage terms and replace their existing loan with a more favorable one. Following the rise in interest rates, the mortgage market cooled, and refinance loans declined.

Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 6 Years data was reported at 2.700 % pa in Feb 2025. This records a decrease from the previous number of 2.840 % pa for Jan 2025. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 6 Years data is updated monthly, averaging 2.930 % pa from Jan 2000 (Median) to Feb 2025, with 302 observations. The data reached an all-time high of 5.800 % pa in Aug 2000 and a record low of -0.370 % pa in Aug 2019. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 6 Years data remains active status in CEIC and is reported by Deutsche Bundesbank. The data is categorized under Global Database’s Germany – Table DE.M016: Mortgage & Public Bonds: Rate.

The mortgage credit interest rate is the average interest rate on mortgage loan products offered to individuals and households by the commercial banks in the country. The mortgage credit is a loan used to finance the purchase of real estate. The table shows the latest available data from the national authorities as well as the values from three months ago and one year ago. The data are updated continuously.

Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 5 Years data was reported at 2.620 % pa in Feb 2025. This records a decrease from the previous number of 2.770 % pa for Jan 2025. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 5 Years data is updated monthly, averaging 2.785 % pa from Jan 2000 (Median) to Feb 2025, with 302 observations. The data reached an all-time high of 5.740 % pa in Aug 2000 and a record low of -0.410 % pa in Aug 2019. Germany Interest Rates: Mortgage & Public Bond: Residual Mat: 5 Years data remains active status in CEIC and is reported by Deutsche Bundesbank. The data is categorized under Global Database’s Germany – Table DE.M016: Mortgage & Public Bonds: Rate.

Bulgaria was at the top of this ranking of 29 European countries sorted by the growth rate of their volume of loans to households in 2023. Loans to households in the European Union and the European Economic Area are expected to grow on average by over three percent in 2024. Meanwhile, the loans and advances market in Germany is expected to increase by 2.2 percent in 2024. Overall, the total value of the household loans market in the EU as a whole is expected to keep growing during that timeline.