We are approaching the end of the year, which means many potential future homebuyers are wondering what the interest rates will look like in 2026. Whether you are preparing to buy your first home or considering refinancing, understanding how interest rates might develop can help you make confident and informed financial decisions.
How does interest play an important role?
Interest rates are one of the most important factors in determining your mortgage costs. Even a small change in rates can have a big impact on your monthly payments, maximum mortgage, and borrowing capacity.
Every mortgage payment includes two parts:
Principal – the amount borrowed.
Interest – the cost of borrowing that money.
When interest rates rise, a larger portion of your payment is allocated toward interest, resulting in higher monthly costs. When rates fall, borrowing becomes cheaper, making it easier to manage payments or qualify for a larger loan.
In simple terms:
Higher rates reduce your borrowing power — you may need a higher down payment or a smaller loan.
Lower rates improve affordability and can help you purchase a larger or better-located home.
Check current mortgage interest rates and compare over 40 mortgage products in the Netherlands.
How interest rates performed in 2025
The past decade has been a period of dramatic shifts in Dutch interest rates. After years of near-zero rates during the 2010s, the European Central Bank (ECB) sharply increased rates in 2022–2023 to curb inflation. This caused Dutch mortgage rates to climb to around 5% at their peak.
As inflation slowed in 2024, the European Central Bank started to cut its policy rates. By mid-2025, the deposit rate had fallen to 2%, signalling a shift toward a steadier financial climate.
With prices now close to the ECB’s 2% goal, the Dutch mortgage market has become more balanced and predictable. Major banks expect mortgage rates to stay broadly stable into early 2026.
What can we expect interest rates to do in 2026?
The outlook for interest rates in 2026 is closely tied to the ECB’s policies, local regulations, and the state of the economy. In its recent review in September, the ECB stated that interest rates are near the end of the current cycle, with no major cuts expected in the near future.
ECB deposit rate: likely to stay at 2%.
Inflation: expected to ease slightly to 1.7% in 2026.
Economic growth: forecast at around 1.0%, showing a stable but modest pace.
The ECB is expected to take a careful, data-driven approach — keeping prices stable while supporting steady economic growth.
The latest update on Central Banks and interest rates in 2026 :
The Federal Reserve is likely to continue cutting interest rates in 2026, but at a cautious pace. A weakening job market supports additional easing, while sticky inflation and tariff-related pressures limit how fast the Fed can move. Rates are expected to trend toward a neutral level of around 3.25%, with a more dovish Fed chair potentially leading to further cuts.
The ECB is expected to keep interest rates on hold, as inflation is close to 2% and growth remains moderate. The threshold for additional cuts is very high, and policy is likely to remain unchanged through 2026. Only if inflation falls significantly below expectations would one or two cuts become possible.
The Bank of England is expected to cut interest rates as inflation falls sharply in early 2026. Although the committee is divided between inflation-focused hawks and job-market-focused doves, easing is becoming more likely as price pressures decline. It is expected to deliver one cut before year-end and two additional cuts in the first half of 2026.
According to ABN AMRO:
Short-term mortgage rates (variable and 1–5-year fixed) are expected to remain close to current levels after earlier declines.
Long-term rates (10 years and above) could stay stable or rise slightly, reflecting consistent bond yields and a modest risk premium.
Overall, mortgage interest rates in 2026 are forecast to move within a narrow range, with no major increases expected.
Other insights
Other financial experts expect mortgage rates to remain broadly unchanged or edge slightly lower in 2026, by roughly 0.4 to 0.8 percentage points compared to the end of 2025.
What this means for homebuyers
If you plan to purchase a home in 2026, stable rates can be good news. Predictability allows you to plan your budget and financing with more confidence.
Here’s what to keep in mind:
Mortgage rates are likely to stay close to current levels.
Monthly affordability should remain manageable for most households.
Should you refinance your mortgage in 2026?
If your fixed rate from 2023/2024 is around 4.5–5.5% and 2026 rates fall to ±3–4%, refinancing can:
Reduce monthlymortgage payments.
Save on interest over the coming years.
Improve affordability or cash flow.
Even a 0.5%–1.0% drop in your interest rate can make refinancing worthwhile in the Netherlands due to the mortgage interest tax deduction. For more information, please contact our mortgage advisors.
How the war in Iran could impact mortgage interest rates?
How war in Iran will impect interest rates in the long run:
European Central Bank (ECB)
The ECB is closely monitoring the Iran conflict as an upside risk to inflation, primarily through higher energy and transport costs.
ECB president Christine Lagarde has stated the bank is watching the global situation closely for economic consequences, while ECB Governing Council member Peter Kazimir has warned that a rate hike could come sooner than anticipated.
The current stance is cautious: markets were pricing in a 33% probability of a rate hike by December 2026 as of early March, though most analysts expect the ECB to hold unless the energy shock spreads into wages and core services prices.
US Federal Reserve
Fed officials are linking the Iran war mainly to inflation risk, signalling it could delay or reduce rate cuts rather than trigger immediate hikes. Minneapolis Fed President Neel Kashkari — who had previously projected one rate cut in 2026 — said the conflict means the Fed now needs significantly more data before acting. New York Fed President John Williams has said the key question is how persistent the higher energy prices will be. CNBC reports the Fed is widely expected to hold rates unchanged at its March meeting.
Dutch banks: Rabobank, ABN AMRO, and ING
The three largest Dutch lenders are each running scenario analyses on what this means for Dutch households. Rabobank's economists have modelled four scenarios ranging from a short conflict (inflation at 2.7%, growth at 1.4% in 2026) to a worst-case destruction of energy infrastructure in Qatar and Saudi Arabia (inflation peaking at 4.4%, growth falling to just 0.6%).
In that extreme case, petrol could hit €3 per litre and new household energy contracts could temporarily exceed €400 per month. ABN AMRO's economists note that while Europe is better positioned than in 2022, inflation could exceed 6% in a prolonged disruption scenario, with the ECB potentially forced to raise rates later in 2026 if high energy prices persist.
ING's chief macro economist Carsten Brzeski has stated the ECB could hike as early as June if the conflict escalates into a prolonged disruption.
The possible outcome: Iran war → higher energy prices → harder to cut rates → policy stays tighter for longer.
This article will be updated as new data and sources become available. For more information, contact our mortgage advisors.
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