Keep 1400 Days of Euribor Rise in Mind: Loan Amounts Hit Records

By now, approximately 1400 days or nearly four years have passed since the euribor rose above zero after a long period of negative interest rates. While the rapid increase in interest rates initially put many home buyers on hold, average loan amounts are now breaking records and the number of concluded contracts is growing rapidly.

While 2022–2023 marked a period of rapid interest rate increases and adjustment, over the past year the market has reached a new equilibrium. Already in 2024, the decline in euribor brought positive sentiment, but 2025 brought noticeable market activity to the market. According to Bank of Estonia data, banks issued approximately 10% more home loans compared to a year ago.

The market activity has been aided by the stabilization of euribor around 2.1%. "While borrowers previously monitored euribor movements on a daily basis, this no longer generates as much excitement," said Anne Pärgma, head of home loans at Swedbank.

According to her, the bank's data shows that in a stabilized interest rate environment, home buyers have clearly returned to the market and average home loan amounts over the past year have been, depending on age group, up to 20% higher than a year earlier.

"If a person has a clear desire and plan to purchase a home and their financial affairs are in order, then it is usually not decisive what field they work in or how old they are. Our goal is to help everyone who wishes to realize their dreams and find a solution for each client based on their situation and make them the best possible offer," explained Pärgma.

The largest home loans are taken by 31–35-year-olds

According to Swedbank data, the average home loan for the youngest clients, those under 22, is approximately 74,000 euros, which mostly reflects a first step into the real estate market and a smaller home. In the 22–25 age group, the average loan amount has already risen to 111,000 euros.

In the next age group of 26–30-year-olds, this reaches 151,000 euros. However, the largest home loans are taken in the 31–35 age group, where the average loan amount is approximately 165,000 euros. It is precisely in these age groups that people often reach a life stage where they start a family and need a larger home than before.

After the age of 35, loan amounts do decrease somewhat, but not significantly. For example, for 36–40-year-olds it is approximately 158,000 euros and for 41–45-year-olds approximately 140,000 euros. Clients over 46 also actively take out home loans – their average loan amount is approximately 106,000 euros.

Movement on the property ladder goes both forward and backward

Often, changes in loan amounts reflect movement on the property ladder. Younger people initially buy a smaller and more affordable home, but as their income grows, they move toward larger or newer living spaces. "At a later age, loan amounts begin to decrease again. Some people move to a smaller space after their children move out and by that time many have also accumulated greater savings for a down payment," explained Pärgma.

Buying a home is usually one of the biggest financial decisions in a person's life and it entails many practical steps – from the loan and appraisal to insurance and everyday banking. Therefore, according to Pärgma, many clients value solutions where the entire process related to home purchase is as clear and convenient as possible.