Euribor Rise Has Not Reduced Demand for Home Loans in Estonia

The six-month Euribor has risen since the beginning of 2026 and reached 2.6% this week. Despite this, Estonian banks confirm that mortgage lending activity has not declined and borrowers' interest in fixed interest rates remains low.

The six-month Euribor, which is included in the interest rates of most home loans issued in Estonia, has been rising consistently since the beginning of 2026 and reached 2.6% this week. Despite this, banks have not observed a decline in demand for mortgages.

Estonian banks confirm that borrowers' interest in home loans remains at a high level, regardless of the Euribor growth trend. Interest in fixed interest rates has remained low, which suggests that borrowers continue to prefer variable interest rates.

Euribor is a pan-European interbank lending reference rate to which a bank's margin is added to form the final loan interest rate. With a variable-rate home loan, the loan payment changes along with Euribor movements, which exposes borrowers to interest rate risk.

A fixed interest rate would protect borrowers against further increases, but Estonian households do not appear to be showing significant interest in this option. According to experts, this may reflect expectations that Euribor growth will remain moderate or reverse in the near term.