Euribor today: The downward trend continues, and homeowners can breathe easier in 2025
In April 2025, the 12-month Euribor recorded its largest year-on-year drop in more than 15 years, settling at an average of 2.143%, compared with 3.703% in April 2024. This decline represents a significant relief for holders of variable-rate mortgages in Spain.
What is Euribor and why is its fall relevant?
The Euribor (Euro Interbank Offered Rate) is the benchmark index most widely used to calculate the interest on variable-rate mortgages in Spain. Its decline translates directly into lower monthly payments on these loans.
Benefits for mortgage holders
The Euribor drop means substantial savings for borrowers. For example:
A typical mortgage of 145,673 euros over 25 years with a margin of one percentage point could generate savings of 134 euros per month—that is, 1,608 euros per year.
Causes behind the fall in Euribor
This decline is due mainly to the European Central Bank (ECB)’s expansionary policy, which has cut interest rates seven times in less than a year, bringing them down to 2.25%. Further cuts are expected, possibly reaching 1.25% by the end of the year.
In addition, factors such as containment of European inflation and economic uncertainty stemming from the tariff war have contributed to this downward trend.
Impact on the mortgage market
The fall in Euribor has boosted the housing market, with increases in home purchases and mortgages. It has also driven the preference for fixed-rate mortgages, which account for 64.6% of new contracts, as borrowers seek stability amid global economic uncertainty.
Banks are adjusting their mortgage offerings to the new market conditions, offering fixed-rate mortgages with interest rates close to 2% APR (TIN) for customers with a strong financial profile.
Conclusion
The downward trend in Euribor in 2025 represents an opportunity for both current and future mortgage holders. It’s a good time to review the terms of existing mortgages or consider new contracts, taking advantage of favorable market conditions.
For those considering switching their mortgage or taking out a new one, it’s advisable to compare the different offers available and get appropriate advice to make the best financial decision.
