German mortgage rates hit highest level since 2009 at nearly 4.5%
Ten-year home loans in Germany now cost an average of almost 4.5%, up from 3.9% in May, broker Interhyp says, adding nearly 200 euros to the monthly payment on an average loan.
Graphic: TERRA WORLD NEWS (own graphic based on the sources listed)
Mortgages in Germany are at their most expensive since 2009. The average rate on loans with a 10-year fixed term stands at just under 4.5%, according to data from mortgage broker Interhyp, up from 3.9% in May. That surpasses the previous peak of just over 4.4% set in late 2023. The rise has been driven by the renewed Iran conflict and inflation fears, and the European Central Bank has raised its key rates.
Interhyp CEO Jörg Utecht said the increase adds almost 200 euros to the monthly payment on an average loan. A lasting solution to the Iran conflict would be needed for rates to fall noticeably, he said, adding: "There is little to suggest that at the moment." Sellers are increasingly willing to lower prices, he said.
"Many sellers still have the peak prices of 2021/2022 in mind," said Dirk Wohltorf, president of real estate association IVD. "If interest rates go up significantly, prices have to come down." Brokers are closing fewer sales and buyers are unsettled, he said. In Bavaria, residential construction orders through July were 3.2% below the previous year, according to the state's construction guilds.