As we approach the end of 2025, many clients and partners seek to understand the evolution of the Euribor — the key index that influences mortgage repayments across the EURO AREA.
Below is a clear and structured overview of the current situation and the outlook for early 2026.
WHERE THE EURIBOR STANDS AT PRESENT
- In October 2025, the 6 Month Euribor — the most commonly used reference rate for variable-rate mortgages in Portugal — stood at 2.107%.
- The annual average is around 2.21%, reflecting a gradual decline from the peaks observed in 2023–2024.
- Throughout 2025, the index has demonstrated controlled stabilisation, with far smoother fluctuations than in recent years.
The final figures for December, which will influence mortgage adjustments at the beginning of 2026, will only be confirmed once the official monthly averages are published.
HOW CURRENT MARKET CONDITIONS IMPACT EXISTING AND PROSPECTIVE MORTGAGE BORROWERS
For existing borrowers and those considering a new mortgage:
- Stabilisation between approximately 2.0% and 2.2% provides increased predictability in monthly repayments, reducing the likelihood of sudden changes.
- The current environment is favourable for renegotiation, mortgage transfers, or new borrowing, with financing costs remaining moderate compared to the last few years.
- Despite the downward trend, rates remain above pre-2008 levels, meaning repayments may still be sensitive to market movements.
WHAT TO EXPECT IN THE COMING MONTHS
The outlook will depend on the decisions of the European Central Bank (ECB) and broader economic conditions in the Eurozone. Possible scenarios include:
- Stability should the ECB maintain a restrictive monetary policy.
- Gradual stabilisation or a slight decline if inflation continues to ease.
- In all scenarios, the present level of predictability remains essential for effective financial planning.
SUBLIME MORTGAGE INSIGHTS
As we move into 2026 with a more stable Euribor landscape, we highlight 3 key considerations to help clients and partners make informed financial decisions:
A Window of Opportunity for Mortgage Term Adjustments
With rates stabilising, this is an appropriate time to reassess existing mortgage conditions.Many borrowers may benefit from renegotiation or transferring their loan to achieve meaningful savings.
Planning Ahead with Confidence
Although volatility has eased, minor adjustments may still arise in early 2026. We advise households to review their budgets and allow for possible fluctuations in repayments, especially for loans indexed to the 6-month Euribor.
The Importance of Careful Comparison
Lenders continue to differ noticeably in spreads, associated products, and contractual flexibility. A thorough and independent comparison remains an effective way to secure more advantageous terms.
