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.

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 **** 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 March 2025 at **** percent, while floating rate mortgages up to one year were the most expensive at **** percent. Mortgages with over **-year fixed period – the most popular loan type among homebuyers — had an interest rate of **** percent. Why did mortgage rates in Germany increase? In 2022, the annual 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 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.

Bank Lending Rate in Germany decreased to 4.09 percent in May from 4.23 percent in April of 2025. This dataset provides the latest reported value for - Germany Bank Lending Rate - plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news.

The annual average interest rate on new residential loans in Germany generally decreased between 2007 and 2023, with some fluctuation. It declined from **** percent in 2007 to **** percent in 2021. In 2023, it significantly rose to **** 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 2.41 % pa in Feb 2025, compared with 2.48 % pa in the previous month.
• Germany Long Term Interest Rate data is updated monthly, available from Jan 1990 to Feb 2025.
• 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 2.90 % pa in Feb 2025.
• Germany Exchange Rate against USD averaged 0.92 (USD/EUR) in Jun 2023.

In the last five years, the mortgage lending sector has seen negative growth. During this period, industry turnover fell by an average of 3.8% per year, meaning that it is expected to amount to 6.5 billion euros in 2024. This nevertheless corresponds to an increase of 3.1% compared to the previous year. As in all sectors dedicated to the provision of financial services, industry turnover, which in this sector is made up of interest and commission income, was negatively impacted by the low level of interest rates. However, the mortgage banks were able to hold their own comparatively well on the market thanks to their favourable refinancing options. Thanks to their comparatively low default risk, Pfandbriefe have become increasingly popular with institutional investors such as insurers in recent years.Industry sales in 2024 will be influenced by the recent increases in the key interest rate by the European Central Bank (ECB). The sector can also build on the high demand for real estate in Germany, which is primarily based on ongoing urbanisation and positive economic growth. The ECB resumed its bond-buying programme in 2020 and expanded it during the coronavirus crisis, allowing real estate banks to refinance themselves at favourable conditions. At the same time, the price of Pfandbriefe has risen thanks to the increased demand for them, which has had a positive impact on this sector. Competition in the market for property loans will remain strong in 2024, meaning that price competition is likely to intensify in the current year.IBISWorld expects industry turnover to increase by an average of 3.4% annually over the next five years, so that it is likely to amount to 7.7 billion euros in 2029. Interest income in particular is expected to increase due to rising interest rates on the capital markets. However, commission income is likely to fall over the next five years as price competition continues to intensify. The search for ways to increase efficiency is likely to lead to an increased reduction in the number of employees.

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 ** billion euros, down from almost ** 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.

Germany - Housing cost overburden rate: Owner, with mortgage or loan was 14.50% in December of 2024, according to the EUROSTAT. Trading Economics provides the current actual value, an historical data chart and related indicators for Germany - Housing cost overburden rate: Owner, with mortgage or loan - last updated from the EUROSTAT on July of 2025. Historically, Germany - Housing cost overburden rate: Owner, with mortgage or loan reached a record high of 15.60% in December of 2023 and a record low of 7.70% in December of 2020.

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 **** percent in many European countries, to as high as ** 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 - Overcrowding rate: Owner, no outstanding mortgage or housing loan was 2.70% in December of 2024, according to the EUROSTAT. Trading Economics provides the current actual value, an historical data chart and related indicators for Germany - Overcrowding rate: Owner, no outstanding mortgage or housing loan - last updated from the EUROSTAT on July of 2025. Historically, Germany - Overcrowding rate: Owner, no outstanding mortgage or housing loan reached a record high of 2.90% in December of 2023 and a record low of 1.10% in December of 2013.

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.

Germany - Severe housing deprivation rate: Owner, with mortgage or loan was 0.30% in December of 2023, according to the EUROSTAT. Trading Economics provides the current actual value, an historical data chart and related indicators for Germany - Severe housing deprivation rate: Owner, with mortgage or loan - last updated from the EUROSTAT on July of 2025. Historically, Germany - Severe housing deprivation rate: Owner, with mortgage or loan reached a record high of 0.90% in December of 2018 and a record low of 0.10% in December of 2020.

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.

The European home mortgage finance market, currently exhibiting a robust Compound Annual Growth Rate (CAGR) exceeding 6%, presents a significant investment opportunity. Driven by factors such as increasing homeownership aspirations, particularly among millennials, favorable government policies aimed at stimulating the housing market in several key European nations (like the UK's Help to Buy scheme, though with adjustments), and low-interest rate environments (though this is subject to change based on global economic conditions), the market is poised for considerable expansion throughout the forecast period (2025-2033). The market is segmented by application (home purchase, refinance, home improvement, other), provider (banks, housing finance companies, real estate agents), and interest rate type (fixed and adjustable). While the market size for 2025 is not explicitly stated, estimations based on the provided CAGR and considering historical market data from reputable sources suggest a substantial value in the billions, with annual growth consistently adding hundreds of millions each year. Key players such as Rocket Mortgage, United Shore Financial, and major European banks (Aareal Bank, Bank of America, Barclays, etc.) are vying for market share, utilizing diverse strategies to attract borrowers and maintain profitability. However, several restraints could influence the market's trajectory. These include fluctuating interest rates, which directly impact borrowing costs and affordability, potential economic downturns that affect consumer confidence and purchasing power, and increasingly stringent regulatory requirements aimed at safeguarding borrowers and promoting financial stability. Furthermore, competition among lenders is fierce, with banks facing challenges from rapidly growing fintech companies offering innovative mortgage products and services. Despite these challenges, the long-term outlook for the European home mortgage finance market remains positive, particularly in countries experiencing strong population growth and economic stability. Regional variations exist within the European market; the UK, Germany, France, and other large economies are expected to drive significant market value, while smaller nations will contribute proportionally less. The projected market size for 2033 is likely to demonstrate considerable growth from the 2025 base. Understanding these dynamics is crucial for stakeholders to navigate the market effectively. This comprehensive report provides an in-depth analysis of the European home mortgage finance market, covering the period from 2019 to 2033. With a base year of 2025 and an estimated market value in the billions (specific figures will be included in the full report), this study offers valuable insights for investors, lenders, and industry professionals seeking to navigate this dynamic sector. Keywords: Europe mortgage market, home loans Europe, mortgage finance Europe, European housing market, refinancing Europe, home purchase finance Europe, mortgage lenders Europe. Recent developments include: November 2022: Rocket Mortgage, the nation's largest mortgage lender and a part of Rocket Companies, today introduced a conventional loan option for Americans interested in purchasing or refinancing a manufactured home., November 2022: The Council of Europe Development Bank (CEB) approved four new loans worth EUR 232.5 million to boost affordable housing and other social sector development. Under this, it offered EUR 25 million in loans to Kosovo to finance the 'Adequate Social Housing Programme' to establish a sustainable social and affordable housing system in the country.. Notable trends are: Increased Number of Salaried Individuals is Driving the Market Growth.

This dataset provides values for INTEREST RATE reported in several countries. The data includes current values, previous releases, historical highs and record lows, release frequency, reported unit and currency.

The value of residential mortgage lending in Germany declined notably in 2024, reaching the lowest quarterly value since 2014. In the second quarter of 2024, gross residential mortgage lending reached a value of 46.7 billion euros. The worsening economic conditions, higher interest rates, and the lack of affordable housing are among the factors leading to the decline in mortgage lending. Nevertheless, Germany is among the largest mortgage markets in Europe. More information on the Mortgage market in Western European countries can be found here.

The value of residential mortgage lending in Germany increased in 2024, following a period of decline and stabilization. In the fourth quarter of the year, the value of new loans reached **** billion euros, up from **** billion euros the same quarter a year ago.The worsening economic conditions, higher interest rates, and the lack of affordable housing are among the factors leading to the decline in mortgage lending. Nevertheless, Germany is among the largest mortgage markets in Europe. More information on the Mortgage market in Western European countries can be found here.

The European home mortgage finance market, currently valued at an estimated €[Estimate based on provided market size and currency conversion; e.g., €500 Billion] in 2025, is projected to experience robust growth, exhibiting a Compound Annual Growth Rate (CAGR) exceeding 6% from 2025 to 2033. This expansion is fueled by several key drivers. Firstly, favorable demographics, including a growing population and increasing urbanization in major European cities like London, Paris, and Berlin, contribute to a consistent demand for housing. Secondly, government initiatives aimed at stimulating the housing market, such as tax incentives or subsidized mortgages, are expected to boost market activity. Furthermore, the ongoing trend of low-interest rates in certain parts of Europe has made mortgage financing more accessible and attractive to prospective homebuyers and those seeking refinancing options. This positive environment also benefits market players such as Rocket Mortgage, United Shore Financial, and major European banks. However, the market is not without its challenges. Potential restraints include economic volatility, fluctuations in interest rates (particularly impacting adjustable-rate mortgages), and stringent lending regulations designed to mitigate risks within the financial system. Furthermore, the segment encompassing home improvements faces potential slowing as macroeconomic conditions change and consumers become more cautious with spending. The market is segmented by application (home purchase, refinance, home improvement, other), provider (banks, housing finance companies, real estate agents), and interest rate type (fixed vs. adjustable). The largest segments are likely to be home purchases and fixed-rate mortgages offered by established banks, although the rapid growth of online mortgage providers may shift this dynamic in the coming years. The UK, Germany, France, and other major European economies will continue to dominate the market share, driven by their larger populations and established financial infrastructure. This dynamic landscape presents opportunities for both traditional lenders and innovative fintech companies to capitalize on growth within the diverse segments of the European home mortgage finance market. Recent developments include: November 2022: Rocket Mortgage, the nation's largest mortgage lender and a part of Rocket Companies, today introduced a conventional loan option for Americans interested in purchasing or refinancing a manufactured home., November 2022: The Council of Europe Development Bank (CEB) approved four new loans worth EUR 232.5 million to boost affordable housing and other social sector development. Under this, it offered EUR 25 million in loans to Kosovo to finance the 'Adequate Social Housing Programme' to establish a sustainable social and affordable housing system in the country.. Notable trends are: Increased Number of Salaried Individuals is Driving the Market Growth.