The housing market in Luxembourg is experiencing challenging times as interest rates on home loans continue to climb, with fluctuations observed in variable and fixed rates during the spring season.

According to the latest report from the Luxembourg Central Bank (BCL), variable interest rates on mortgages have surged, reaching an average of 4.38% in May, compared to 4.11% in April.

This is bad news for those who have already opted for variable-rate loans, as their monthly repayments could rise considerably, depending on the terms of their loan.

In contrast, fixed interest rates fell to 3.85% in May. This marks the second consecutive decrease, at least temporarily, after the rate stood at 3.93% in March.

Finally, the interest rate for consumer credit with a term of less than five years was 4.85% in May.

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Property market: Here's why it's getting increasingly harder to get a loan in Luxembourg