Building interest rates stable: Experts warn of interest rate spikes and price jumps!

Building interest rates stable: Experts warn of interest rate spikes and price jumps!

As of June 29, 2025, current assessments from experts show a stable situation on the real estate market. According to a weekly interest rate check by Morning post The building interest rates for ten-year loans are currently around 3.5 percent. However, Oliver Kohnen, managing director of Baufi24, points to possible short-term fluctuations in interest rates, which encourages buyers not to wait any longer. Real estate prices are not expected to fall, increasing the urgency for prospective buyers.

Kohnen recommends a fixed interest rate of at least 15 years for planning security in order to cover potential interest rate risks. In addition, forward loans can be used if interest rates fall again in 8 to 9 years. His assessment suggests that longer terms only make sense if the interest premium is not too high compared to shorter terms.

Uncertainties in the market

The current interest rate forecast situation is determined by HipoChart described as extremely unsafe. Both consumers and experts must expect unpredictable developments that can render forecasts invalid. Real estate buyers should view interest rate forecasts critically, especially in the current global political situation, which is characterized by the war in Ukraine.

The so-called “turning point” requires careful planning for larger investments. With regard to the general level of interest rates, building interest rates are closely related to fixed-interest securities. The current yield, which was 2.42 percent on June 2, 2025, illustrates this connection. For comparison: at the end of February 2022 it was still 0.03 percent. In addition, ten-year federal bonds now offer positive returns of around 2.64 percent.

Forecasts and economic situation

The ECB pursues a monetary policy to ensure monetary stability, with an inflation target of 2 percent. In the euro zone, inflation reached 10.6 percent in October 2022. The ECB has been raising key interest rates since July 2022, but there were already the first interest rate cuts from June 2024. Current figures show that the ECB key interest rate is 2.15 percent on June 11, 2025.

While the EU Commission forecasts growth of 1.7 percent for 2025, German institutions expect different growth rates: the federal government expects 0.3 percent, while the EU Commission and the IMF even expect 0.0 percent. This uncertainty, compounded by geopolitical risks, could further unsettle investments in the real estate market. Real estate prices fell by an average of 11.2 percent in 2024 compared to 2022.

It is therefore advisable for builders to choose a high repayment rate and to check the purchase price carefully. In unclear market situations, it might make sense to wait before investing in order not to end up in an unfavorable financial situation.