Bad news for buyers and homeowners in Luxembourg, as interest rates, especially variable rates, have seen a notable increase, according to the latest data from the Luxembourg Central Bank (BCL).

In August, the BCL reported a rise in interest rates, with variable rates being the most affected. Data collected from property borrowers reveals a continued uptick in variable interest rates, now standing at 4.67%, up from 4.60%. This increase continues a meteoric climb, given that in August 2022, the rate stood at just 1.36%.

Conversely, the fixed rate has shown a more stable trend. After reaching its peak at 3.93% in March, it has hovered around 3.80% ever since. However, it is important to exercise caution with this average rate, as the BCL highlights that for very long-term loans, the fixed rate can be higher.

The impact of rising interest rates is not limited to mortgages, as consumer loans with a term of one to five years have also seen an increase, now standing at 5.33%.

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