Swedish Floating Mortgage Rates Fall to 2.74% as Housing Loan Growth Picks Up

Swedish mortgage borrowing costs edged lower in July, with the average floating interest rate on new housing-loan agreements falling to 2.74% from 2.75% in June. At the same time, the annual growth rate for housing loans increased to 3.4%, extending the gradual pickup in mortgage credit seen over the past year.

The average rate across all new housing-loan agreements also declined, to 2.78% from 2.80% a month earlier. The changes were modest, but they continued the easing in mortgage pricing that followed a spring increase in several fixed-rate categories.

Statistics Sweden’s July Financial Market Statistics, released on August 27, showed that housing loans remained the dominant part of household borrowing from monetary financial institutions. They represented 83% of total MFI lending to households, while the annual growth rate for all household lending was 3.3%.

Floating rates edge lower as longer fixes also ease

Statistics Sweden classifies a floating mortgage rate as one with an interest-rate fixation period of up to and including three months. Its new-agreement measure covers loans whose interest terms are set for the first time as well as renegotiated existing loans and loans moved between lenders. Automatic changes to an already floating rate are not counted as new agreements, which makes the series a measure of pricing on newly set or reset mortgage terms rather than a simple average of every mortgage in the country.

Within that measure, July’s 2.74% floating rate was the third consecutive monthly decline after the rate reached 2.81% in April. It slipped to 2.78% in May and 2.75% in June before moving another basis point lower in July. The July reading was also below the 2.85% level recorded in July 2025.

Rates on fixed periods moved down as well. New housing loans fixed for more than three months and up to one year averaged 2.79% in July, compared with 2.84% in June. The rate for loans fixed for more than one year and up to five years fell to 3.15% from 3.21%, while the rate for terms above five years declined to 3.21% from 3.30%.

The near-term difference between floating loans and mortgages fixed for more than three months and up to one year was therefore small in July. Longer fixes still carried higher average rates. The statistics are market averages, so they show the direction of newly set mortgage pricing rather than the exact terms available to any individual household.

Housing-loan growth rises to 3.4%, with most balances still floating

The other important development in the July figures was the continued acceleration in mortgage credit. Housing loans grew 3.4% from a year earlier, up from 3.3% in June. The comparable growth rate was 2.4% in July 2025, showing that the mortgage book was expanding at a faster annual pace than a year earlier.

That 3.4% figure is an annual growth rate, not a one-month increase in borrowing. It therefore describes how the outstanding housing-loan stock compared with the same month a year earlier and should not be read as evidence that mortgage balances jumped 3.4% during July alone.

Outstanding housing loans at MFIs totaled SEK 4.334 trillion in July. Of that amount, 77%, or SEK 3.329 trillion, carried a floating interest rate. The size of that floating-rate share makes short-rate mortgage pricing particularly relevant to Swedish household finances, because a large portion of the mortgage stock has relatively short interest-rate fixation periods under the statistical definition.

Housing credit also dwarfed other household lending categories in the report. Consumer loans accounted for 6% of household lending and grew 1.3% from a year earlier, compared with the 3.4% growth rate for housing loans. Total MFI lending to households increased 3.3% year over year.

Mortgage credit companies outside the MFI sector remained a much smaller part of the market. Statistics Sweden reported SEK 44 billion of housing loans at those firms, equal to about 1% of total household housing loans, with annual growth of 1.2% in July. The figures reinforce that the MFI data capture the overwhelming majority of the mortgage balances tracked in the release.

Riksbank holds policy rate at 1.75% ahead of September decision

The July mortgage figures arrived one day after the Riksbank’s latest policy-rate decision took effect. The central bank left its policy rate unchanged at 1.75%, with the new decision applying from August 26. The mortgage data cover July, so they predate that decision and do not establish that the central bank’s August announcement caused the latest decline in new mortgage rates.

For borrowers, the policy backdrop still matters because so much of the outstanding mortgage stock is on short fixation periods. The Riksbank said measured inflation remained low but warned that underlying inflation could become too high following supply shocks. It also said the probability of a rate increase later in 2026 remained, while noting that the outlook was not clear-cut.

July therefore put two trends in the same dataset: slightly cheaper new floating-rate agreements and lower rates across several fixed periods, alongside firmer housing-loan growth. With 77% of MFI housing balances classified as floating, future changes in short-rate pricing can reach a large share of the mortgage stock as rates reset or loan terms are renegotiated. The figures do not show that lower mortgage rates alone caused the lending pickup, and Statistics Sweden did not assign a single cause to the change in credit growth.

The next policy-rate announcement is scheduled for September 24 after the Riksbank’s September 23 meeting. Statistics Sweden lists the next Financial Market Statistics release for September 25. Together, those updates will show whether the current 1.75% policy setting is maintained and whether the decline in Swedish mortgage rates and the pickup in housing-loan growth continued into August.