There was the usual springtime activity in the housing loan market in May. The banks issued a total of 219 million euros in housing loans, which was 23% more than in the same month of last year. This was partly because the second quarter of the year is typically the busiest in the market for housing loans, and partly because the real estate market has grown after a period of calm in 2023 and the first half of 2024, and this has seen the number of transactions increase in the housing loan market as well. The average price of apartments has changed relatively little, while the average wage has grown quite notably at the same time. Demand has been supported by both Euribor and the average interest margin on housing loans declining, and the margin is now at its lowest level for a decade. The rise in VAT in July 2025 may have had some impact, as it may have encouraged buyers to complete their transactions earlier.

Housing transactions are increasingly being financed with loans. The amount issued in housing loans has grown faster than the number of sales transactions for residential real estate. Loans usually finance 40% of the transactions in the housing market, but in recent months this has increased to 50%.

Growth in loans is expected to remain relatively strong as the economy recovers. The housing loan portfolio of the banks was 9% larger in May than a year previously, which is a faster rate of growth than the average over the longer term. The current situation is however not the same as during the mini-boom in the loan and real estate markets in 2021–2022. The real estate market was boosted at that time by strong growth in incomes, accumulated savings, and withdrawals from the second pension pillar.

Eesti Pank published the statistics for banks and lease companies for May 2025 on its website today. The statistical release describes the main changes in the statistics on banks and leasing companies, covering the volume and structure of assets, loans and leases issued, deposits, and interest rates on loans and leases. The statistical release is independent of economic policy releases and is presented separately from them.

Additional information:

Viljar Rääsk
Head of Communications
Eesti Pank
6680 745, 5275 055
Email: [email protected]
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