Overview
- The ECB left the deposit rate unchanged at 2.00% in December 2025, and several analysts expect policy to remain broadly steady through at least mid‑2026, possibly to year‑end.
- Ten‑year mortgage offers have climbed to roughly 3.7–3.8% late in 2025, with specialists saying a move toward about 4% in 2026 is more likely than a return to 3.5% unless long‑term yields retreat.
- Rising 10‑year government bond yields and higher public borrowing are cited as key forces pushing financing costs up, and experts see little sustained relief without a decline in capital‑market rates or renewed large‑scale ECB bond buying.
- Lenders are tightening underwriting and factoring in energy performance, making poorly rated or renovation‑heavy properties harder or more expensive to finance even for otherwise solid borrowers.
- Short‑term dynamics could open brief opportunities, with some banks expected to trim margins in January 2026 and competitive moves in savings—potentially including Chase’s planned Germany launch in Q2—likely to spur sharper offers.