The implicit interest rate across housing credit agreements decreased to 3.385% in July, reflecting a decline of 9.4 basis points from June’s 3.479%, according to data released by the National Statistics Institute (INE) on Wednesday.
For agreements signed in the last three months, the interest rate fell from 2.951% in June to 2.897% in July.
The average installment was set at 394 euros, unchanged from the previous month, representing a decrease of 11 euros compared to July 2024.
“For the purpose of financing Housing Acquisition, the most significant within the realm of housing credit, the implicit interest rate for all contracts dropped to 3.377%, down 8.9 basis points compared to June. For contracts signed in the last three months, the interest rate decreased by 5.3 basis points from the previous month, settling at 2.895%,” the National Statistics Institute report stated.
Housing loans grew by 7.3% in June on a year-on-year basis, reaching 106,321 million euros, marking the highest annual growth rate since August 2008, as reported by the Bank of Portugal (BdP).
Lusa | 13:15 – 25/07/2025
“Of the installment amount, 202 euros (51%) corresponds to interest payments and 192 euros (49%) to principal repaid. For contracts signed in the last three months, the average installment amount rose by 5 euros, reaching 636 euros (an increase of 3.9% compared to the same month the previous year),” according to the statement from INE.
The INE further revealed that in the same month, “the average capital owed for all contracts rose by 593 euros compared to the previous month, reaching 72,270 euros.”
“For contracts signed in the last three months, the average amount owed was 159,553 euros, an increase of 2,203 euros since June,” it stated.
The National Statistics Institute explains that the “statistical operation Implicit Interest Rates on Housing Credit aims to provide indicators of the financial effort assumed by families and the state in housing credit. It is based on an administrative procedure using information from banking institutions submitted to the National Statistics Institute under a protocol.”
“The indicators on interest rates, average capital owed, and installment due are calculated for aggregate totals, for different financing purposes (housing construction, acquisition, and renovation), by the period of credit contract (last 3, 6, and 12 months), and also with segmentation by credit regimes,” it further explained.
The demand for loans by individuals increased in the second quarter, particularly in the housing segment, while for companies, only the demand for short-term loans and by SMEs grew, according to a survey by the BdP.
Lusa | 16:06 – 22/07/2025
[Updated at 11:07 AM]
