Lithuania’s Housing Loan Market Surged in 2025

Lithuania’s housing loan market expanded sharply in 2025, reaching its highest level in several years. SEB Bank granted housing loans worth €837 million during the year, marking a 59% increase compared to 2024. The Vilnius region remained the main growth engine, driving housing financing nationwide.

According to the Centre of Registers, the number of housing transactions in Lithuania was approximately 21% higher than in 2024. Market growth was supported by lower interest rates, a broad supply of new housing and a resilient economic environment.

The average 6-month EURIBOR rate stood at 2.2% in 2025, down from 3.49% in 2024. Since May 2025, rates have stabilised, and the European Central Bank has signalled no significant changes for 2026, suggesting relatively stable borrowing conditions in the near term.

Housing prices increased by close to 10% year-on-year in 2025, already outpacing wage growth and raising concerns about affordability.

According to Eglė Dovbyšienė, Member of the Board of SEB Bank and Head of Retail Banking, additional demand expectations at the turn of 2025–2026 were fuelled by discussions about partial withdrawals from second-pillar pension funds and upcoming amendments to Responsible Borrowing Regulations effective from 1 August 2026. These factors may further stimulate short-term demand, particularly in major cities.

The average mortgage loan amount reached approximately €111,000 in 2025, rising by 12% annually. This slightly exceeded the national housing price growth rate, indicating relatively stable housing characteristics in terms of size and location.

Regional differences were notable. In the Vilnius region, the average loan amount increased by 8.6% to €125,000. In the Kaunas region, it rose by 9%, while in the Klaipėda region it jumped by 17%. Rough estimates suggest that for the same average loan amount, buyers could purchase about 4 square metres less housing in 2025 compared to a year earlier.

The Vilnius region recorded the fastest growth in both housing transactions and mortgage issuance. SEB Bank statistics show that the number of loans issued there increased by 61%, while in other Lithuanian regions growth reached 23%.

Demographic trends support this concentration. The population of Vilnius city and district increased by about 13,000 over the year. Kaunas region grew by around 1,000 residents, Klaipėda region by about 2,000, while the rest of the country experienced a population decline of roughly 19,000.

The faster growth in mortgage issuance compared to overall housing transactions indicates a slightly higher share of purchases financed by loans. Increased refinancing activity also contributed to lending growth.

In addition, demand for energy-efficient housing is strengthening. In 2025, one quarter of all new housing loans issued by SEB Bank were green loans, which benefit from more favourable financing conditions.

The housing market is expected to remain active in 2026. One of the key questions is whether the record transaction volume of 2021 can be matched or exceeded. Early 2026 data suggest the market is moving in that direction.

In January 2026, the average housing loan amount had already reached €123,000. Housing prices are likely to grow by close to 10% this year, while new lending volumes are expected to increase further, albeit at a slower pace than in 2025, when growth was calculated from a relatively low 2024 base.

As International Investment experts report, Lithuania’s mortgage boom reflects demographic concentration in Vilnius and improved financial conditions, yet sustained price growth above income dynamics could gradually increase affordability pressures and amplify structural imbalances in the country’s largest urban markets.