Portugal mortgage credit market sees mixed‑rate share fall in 2025

Portugal’s banking regulator reports that in 2025 most new mortgage credit was still granted at a mixed rate, but its share fell to 75.4% of the total amount, down from 81.5% in 2024. Variable‑rate loans rose to 18.6% of new funding, up from 12.4%, while fixed‑rate contracts remained around 6%.

Variable‑rate mortgages now dominate the overall portfolio, representing 68.1% of all live mortgage contracts at year‑end. New mortgage contracts averaged 11,134 per month – an 11.5% increase – with a monthly average credit amount of €1.95 billion, 34.9% higher than the previous year. The number of new mortgage contracts fell 8.7% to 37,366, although the total new credit volume grew 1.8% to €2.7 billion.

The average term of new mortgages lengthened to 31.7 years, while the average term across all contracts slipped slightly to 33.5 years. Early repayments and renegotiations both decreased: early repayments fell 7.2% and total amortised volume dropped, while renegotiations fell 26.4% to 49,795 cases amounting to over €5 billion. The share of non‑performing mortgage loans fell to 0.1% of total exposure, half the level recorded in December 2024.

In the Madeira region, the implicit mortgage rate slipped to 3.121% in May, although the average outstanding loan per borrower continued to rise, reaching €72 k. Nationally, the implicit rate stood at 3.065% and the average monthly payment was €405.