“For real estate financing, it is not so much the key interest rates that are decisive, but rather the long-term interest rates, which are determined by the capital market”

Francesco Fedele, CEO of BF.direkt AG, on the ECB’s current interest rate decision

“For real estate financing, it is not so much the key interest rates that are decisive, but rather the long-term interest rates, which are determined by the capital market. The ten-year swap rate has shown a clear trend since 2024: upwards. There is nothing left of the temporary easing of tensions after the ceasefire in Iran. If, after the current increase, the ECB leaves the key interest rates unchanged on the other interest rate dates this year, long-term interest rates could stabilize. If, on the other hand, the surge in inflation becomes entrenched, financing costs will continue to rise. It therefore remains important for borrowers to prepare for refinancing at an early stage and not to rely on interest rates falling significantly again in the short term. It should also be borne in mind that the current interest rate level is still low on a long-term average.”