A year ago the choice between a fixed and a variable mortgage looked like a minor detail. The 6-month Euribor averaged 2.10% in September 2025 and 2.92% in September 2026, and the European Central Bank has lifted its deposit rate twice in between. For a rental investor with a thin yield margin, the structure of the loan is now a core part of the deal.

This article puts one loan through three structures, with real Euribor data, and then asks which one survives a stress test.

Key takeaways: On an illustrative €200,000, 30-year loan with a 1.2% spread, the payment on a variable rate reset from €876.16 (Euribor 6M at its September 2025 average) to €968.90 (September 2026), up €92.74 or 10.6%. A fixed rate of 3.9% would cost €943.34 and never move. Variable only beats that fixed rate while Euribor stays below about 2.7%.

What is the difference between fixed, mixed and variable?

A variable rate is a reference rate, usually Euribor at 3, 6 or 12 months, plus a bank spread. The payment resets when the contract reviews the rate, which happens at the interval of the Euribor chosen. A fixed rate stays the same for the agreed fixed period, often the whole term. A mixed rate is fixed for an initial period, then switches to variable for the remainder.

The trade is simple to state. Fixed pays a premium to remove uncertainty. Variable saves that premium when rates fall, and costs you when they rise. Mixed splits the difference in time. The next sections compute how the three behave on one set of numbers.

Euribor rose by about 0.8 points in a year

Further than many borrowers expected. Monthly averages from the ECB Data Portal show the 3-month Euribor going from 2.03% in September 2025 to 2.64% in September 2026, the 6-month from 2.10% to 2.92% and the 12-month from 2.17% to 3.25%. Over the same stretch the ECB's deposit facility rate went from 2.00% to 2.25% in June 2026 and to 2.50% from mid-September.

Euribor, Sep 2025 vs Sep 2026 (monthly average) 3M 2.03% 2.64% 6M 2.10% 2.92% 12M 2.17% 3.25% Muted bar: September 2025. Bright bar: September 2026. Source: ECB Data Portal. Source: European Central Bank, Data Portal, Euribor monthly averages (retrieved 2026-10-06).

The longer tenors moved most, because they price expected future rates. The 12-month is now above 3%, and a mortgage tied to it will reset higher at its next review than one tied to the 3-month. That is a reminder that "variable" is not one product: the tenor you pick sets how often, and from which curve, your payment changes.

What would one €200,000 loan have cost under each structure?

Take €200,000 over 30 years with a bank spread of 1.2%. The spread, and every fixed and mixed rate below, is an illustrative assumption for the comparison, not a bank quote; check offers against the rates banks are actually charging. Run your own offers through the mortgage calculator.

Variable on 6M Euribor. At September 2025's average the rate is 3.30% (3.3023% unrounded) and the payment €876.16. At September 2026's it is 4.12% (4.1216%) and the payment €968.90. Payments are computed on the unrounded averages. That is €92.74 more a month, or €1,113 a year, with nothing changing except the reference rate.

Fixed at 3.9%. The payment is €943.34 from day one, and stays there. Compared with the variable payment today it is €25.56 a month cheaper. Compared with the variable payment a year ago it was €67 dearer.

Mixed, fixed at 3.5% for five years. The payment is €898.09 for 60 months. After that the balance, about €179,394, is repaid over the remaining 25 years at Euribor plus the spread.

6M EuriborVariable (+1.2%)Fixed 3.9%
1.92%€856.38€943.34
2.92% (September 2026 average)€968.90€943.34
3.92%€1,088.56€943.34
4.92%€1,214.78€943.34

The mixed loan behaves differently, because the five-year fixed stretch shields you first. Here is its payment after year five at three Euribor levels:

6M Euribor in year 6Mixed payment after year 5Years 1 to 5
2.0%€869.49€898.09
2.92%€958.99€898.09
4.0%€1,069.73€898.09

The break-even is the number to remember. Fixed at 3.9% beats variable whenever Euribor plus the 1.2% spread exceeds 3.9%, so whenever 6M Euribor is above 2.7%. It is 2.92% on the latest monthly average.

In short: Between September 2025 and September 2026 the 6-month Euribor monthly average rose from 2.10% to 2.92% (ECB). On a €200,000, 30-year loan with an assumed 1.2% spread, that lifts a variable payment from €876.16 to €968.90, an extra €92.74 a month, or 10.6%.

What does the choice do to a rental investor?

It changes the margin of safety. In our price-to-rent analysis, INE's data imply a national net yield near 4.2% after costs, against a variable mortgage costing about 4.1%. At that spread a one-point rise in Euribor wipes out the profit.

Quantify it with the €200,000 loan. A payment of €968.90 becomes €1,088.56 if Euribor rises a further point. That is €119.66 a month more, or €1,436 a year, and it hits cash flow in full, because rent on a sitting tenant is capped. The 2027 coefficient is 2.56% (see the rent increase guide), well below what an interest shock does to a payment.

Why does that matter more for an investor than for an owner-occupier? Because the owner can cut spending; the investor's flat has a break-even rent, and below it the property pays you negative. Check yours with the break-even rent method and test debt cover with the DSCR guide.

Put a rental on top. Say a flat worth about €300,000, financed with the €200,000 loan (loan-to-value around 67%), lets for €1,300 a month and operating costs take 20% (all assumptions), leaving €12,480 of net income a year. Debt service of €11,626.80 on today's variable payment gives a DSCR of 1.07. After a one-point rise it is 0.96, and the flat no longer pays its own loan. The 3.9% fixed payment gives 1.10 and stays there. None of those ratios is comfortable: at this leverage the structure mostly decides how slowly you get hurt.

The sensible rule is to size the structure by the stress case, not the current payment. Add two points to Euribor in the Euribor cash-flow calculator. If rent still covers debt service with a cushion, variable is defensible and probably cheaper over a falling-rate cycle. If it does not, the fixed premium is an insurance cost worth paying. For the wider rate-risk picture, see our Euribor risk analysis.

How to choose a rate structure

There is no universal answer, but there is a method.

  • Thin margin, high leverage: lean fixed or mixed. If a two-point rise in Euribor pushes you below break-even, you are underwriting a rate view, not a property.
  • Wide margin, low leverage: variable is reasonable, and cheaper if rates drift down. You can absorb the move.
  • Holding period under five years: mixed fits. You pay a known rate for the years you will own the asset, and the variable tail matters less.
  • Always compare the fixed premium to the break-even. Here that was 2.7% against 2.92% today, which made fixed the cheaper choice at the latest averages.

Also check the loan-to-value and debt-service limits that Banco de Portugal's macroprudential measures set for lenders; our LTV guide and non-resident mortgage guide cover them. This article is general information, not personal financial advice, and the rates shown are illustrations rather than offers.

Sources

Frequently asked questions

Is a fixed or variable mortgage better in Portugal in 2026?

It depends on your margin. With the 6-month Euribor at 2.92% (September 2026 average), a variable loan at a 1.2% spread costs 4.12%, so a 3.9% fixed rate is cheaper today. Variable wins only if Euribor falls below about 2.7%.

How much did Euribor rise between September 2025 and September 2026?

The ECB Data Portal shows the 6-month Euribor monthly average rising from 2.10% to 2.92%, the 3-month from 2.03% to 2.64% and the 12-month from 2.17% to 3.25%. The ECB deposit rate moved from 2.00% to 2.50% over the period.

What is a mixed-rate mortgage?

A loan that is fixed for an initial period, for example five years, then switches to a variable rate of Euribor plus a spread for the remaining term. It gives certainty during the early years while leaving some exposure to later rate moves.

How much more would a €200,000 variable loan cost after the rise?

On an illustrative 30-year loan with a 1.2% spread, the monthly payment moves from €876.16 at September 2025 Euribor 6M to €968.90 at September 2026 levels. That is €92.74 more a month, or about 10.6%.