The 12-month Euribor – the main benchmark for variable-rate mortgages in Spain – has closed October at 2.187%, marking its third consecutive monthly increase and reaching its highest level since March.
While official confirmation from the Bank of Spain is still pending, the figure reflects a modest but steady upward trend.
Despite the rise, the Euribor remains about half a percentage point below where it stood this time last year.
However, it’s now slightly above the average from six months ago, which means borrowers with mortgages that reset every six months will see a slight increase in their repayments – the first such rise in nearly two years.
But for those affected, the increase will be minimal. In April, the Euribor averaged 2.143%, just below the current rate. The result is an average annual increase of around €24 in mortgage payments.
It’s worth noting that mortgages with biannual reviews are the exception. The majority of Spanish mortgage holders, whose rates adjust annually, will continue to benefit from lower monthly payments.
With the Euribor at 2.691% last October, those on 12-month revision cycles will actually see savings of around €40 a month, or approximately €480 a year.
Depending on loan size, interest spread, and remaining term, monthly savings could range between €26 and €80.
Entering a period of calm
Experts agree that the Euribor is entering a stable phase. Most forecasts suggest it will hover between 2.1% and 2.2% in the short term.
This stability is closely tied to the European Central Bank’s decision – for the third consecutive meeting – to keep interest rates fixed at 2%, as announced on October 30.
With inflation relatively contained and global trade uncertainties dampening market sentiment, analysts are not expecting rate cuts anytime soon. That limits the scope for further drops in the Euribor.
Analysts at Ebury – the Santander-owned fintech specialising in payments and FX – believe the ECB’s rate-cutting cycle has already run its course, which reduces the likelihood of significant movement in either direction. In their view, the Euribor should remain steady around the 2.1% mark.
Francisco Rodríguez, Head of Financial Studies at Funcas, told Idealista: ‘The Euribor anticipated the ECB’s cuts during the easing cycle and is now pricing in a stabilisation phase.
‘In practical terms, that means we’ll see little movement over the coming months, it may fluctuate, but without any clear downward trend as long as the ECB holds rates.’
Read more Spain property news at the Spanish Eye.
