How Euribor Moves Are Shaping Mortgage Costs in Europe and Beyond
From April 21 to Tuesday, May 31, 2022, Euribor displayed positive values for the 29th consecutive time, with May marking the first full month of positive readings since January 2016 since the data are published only on business days. This pattern means there has been no negative Euribor data during that period.
So far this year, the rise in Euribor has been notably stronger than the early 2022 figures. After starting January at -0.477% and reaching 0.287% by late May, the increase surpasses seven-tenths in magnitude. On an annual basis, Euribor moved from -0.481% in May 2021 to higher levels, reflecting a growth of about 159.7%. Analysts point to a dramatic macroeconomic shift as the catalyst for this surge. Simone Colombelli, director of Mortgages at iAhorro, described the moment as a crisis. Since the Ukraine-Russia conflict began in February, Europe has faced an unprecedented energy squeeze that has contributed to inflation in Spain and across the euro area, with consumer prices hovering around 8.7% in recent figures.
Euribor’s Evolution. iSavings
To project Euribor’s trajectory in the coming months, Colombelli explained a method that assumes the trend observed so far will continue. In his view, the mortgage comparator’s spokesperson suggests Euribor could finish 2022 near 1.35%, even before accounting for potential further hikes from the European Central Bank (ECB), which has signaled further rate increases in the near term. If the ECB raises rates again in July, the downward pressure on inflation could ease later, but borrowing costs would likely rise further.
How Much Might Variable Mortgage Payments Rise?
Rises in Euribor affect those with floating-rate mortgages most directly, as their monthly payments are recalibrated in May based on the updated index. For a concrete example, a borrower with a 300,000 euro loan contracted in 2021 over 30 years with a 0.99% spread above Euribor would see a monthly payment increase to about 1,000 euros, from roughly 898.75 euros, solely due to the Euribor uptick. The annual impact would be around 1,215.72 euros more each year for this loan profile.
In another scenario, a 150,000 euro mortgage over 30 years with the same 0.99% spread would see monthly installments rise from about 449.38 euros to 500.03 euros, an increase of 50.65 euros per month and 607.80 euros per year. These figures illustrate how even modest shifts in Euribor can translate into meaningful changes in monthly budgets for homeowners.
Is a Mixed Mortgage a Viable Choice for Young Buyers?
The Euribor uptick also pushes overall mortgage rates higher, prompting lenders to adjust offerings. Some banks have started reintroducing fixed-rate options around 2% or a bit higher, a level that was common in 2017 and 2018, though still above the low rates seen in 2021. The mortgage manager at iAhorro notes there are fixed-rate options available, albeit with careful comparison, since fixed rates in some cases approach or exceed 2% depending on term and loan size. The sense among market watchers is that fixed rates might represent a temporary peak for those seeking stability while prices and terms remain favorable.
Analysts observe that banks are recalibrating how they present adjustable-rate products so they can regain prominence in the home financing market. Mixed mortgages, which combine a fixed-rate initial period with a subsequent floating-rate term, are already showing appealing terms in some cases, especially for the first 7–10 years of the loan. This setup can offer a balance between predictability and potential savings if Euribor trends align with favorable rates.
For younger buyers—or those who can adjust their loan terms before entering the floating tranche—these mixed arrangements can provide a degree of certainty without locking into high fixed rates for the entire term. Yet lenders’ willingness to offer such products varies, and the availability of aggressively priced fixed periods often hinges on broader market conditions and regulatory considerations in each country.