Mortgage rates July 2026: why the ECB is hiking — and your financing need not get more expensive
In June the ECB raised rates for the first time in almost three years. But mortgages track the capital market, not the policy rate — and the capital market actually fell in June.
The starting point
On 11 June 2026 the ECB raised all key rates by 0.25 percentage points (effective 17 June). The main refinancing rate now stands at 2.40%, the deposit facility at 2.25% and the marginal lending rate at 2.65% — the first increase since September 2023.
For mortgages, though, what matters is the yield on the ten-year German Bund and covered bonds (Pfandbriefe) rather than the policy rate — and these moved the other way: the 10-year Bund yield stood at around 2.85% at the end of June, roughly 0.15 points lower over the month and near its lowest since early March. The reason: after the ceasefire in the Middle East, oil eased toward USD 70, inflation expectations dropped, and markets priced out part of the expected further ECB tightening.
As of early July 2026: 10-year Bund yield around 2.85%; 3-month Euribor around 2.25% (start-of-June reading). The next ECB meeting is on 23 July 2026 — a further hike is possible but no longer firmly priced in.
What this means for your financing
- New financing: Fixed rates follow the capital market, not the policy rate directly — and the market shows no clear upward move right now. The rule of thumb "lock in fast, everything is rising" does not automatically apply. It makes sense to compare fixed and variable models for your specific situation.
- Refinancing (Anschlussfinanzierung): If your fixed period expires within the next 12–36 months, a forward loan is worth a look to secure today's level — regardless of where the ECB leans on 23 July.
- Existing variable loans: If you financed on a variable basis, you feel money-market rates at the next reset. After June's hike, the reference rate sits higher than at the start of the year.
There is no reliable rate forecast. I do not issue a market forecast as a recommendation — I compare fixed and variable offers across 500+ banks for your situation and put the instalments side by side so you can decide on the numbers.
Frequently asked questions
Are mortgage rates rising now because the ECB hiked?
Fixed or variable — what is better now?
What does the 23 July ECB meeting mean for me?
Request a financing analysis
Free initial consultation — the commission is paid by the bank. I compare current fixed and variable conditions across 500+ banks for your situation.