Pfandbrief banks grant new property loans totalling EUR 80.4 bn in first half-year

New property lending business up by 8.5%

Between January and June of this year, the banks which together make up the Association of German Pfandbrief Banks (vdp) granted property loans totalling EUR 80.4 bn. Compared with the first half of 2025, new loan commitments rose by 8.5% (H1 2025: EUR 74.1 bn).

With a share of 62.3%, residential property loans again accounted for the greater part of property finance, representing a volume of EUR 50.1 bn in the first half of this year. This represented a 5.3% increase on the year (H1 2025: EUR 47.6 bn). Commercial property loans saw a growth rate of 14.3%, albeit from a level that is still low when viewed over the long term: they totalled EUR 30.3 bn between January and June 2026 (H1 2025: EUR 26.5 bn).

“At best, slight increases in new property lending may be expected in the second half of 2026.” Jens Tolckmitt

“New property lending by the Pfandbrief banks shows growth in the first half of 2026. Although performance in this business area is solid, lending remains clearly below the volumes achieved before the turnaround in interest rates,” Jens Tolckmitt, Chief Executive of the vdp, emphasized. Given the current circumstances, he expects, at best, slight increases in new lending in the second half-year. It is to be assumed, he said, that the geopolitical uncertainties, weak economic activity and the persistently tight housing market situation will have a dampening effect on property finance as well.

Tolckmitt called on policymakers to give greater support to private households wishing to become homebuyers, saying that owning one’s own four walls remains the best way to provide for old age. “The fact that most people in Germany live in rented housing shows how great the potential is for promoting home ownership.” For example, he pointed out that lowering property transfer tax for owner-occupiers would make a significant contribution towards increasing access to home ownership. This would reduce the amount of borrowed capital needed, and thus make buying a property considerably more affordable. At the same time, he remarked, this would ease rental housing market tension.

Residential properties: loans for multi-family houses see strongest growth

Almost all property categories contributed to the rise to EUR 50.1 bn of total residential property loans granted in the first half of 2026. The strongest relative increase year on year, by 7.3%, was recorded for loans for multi-family houses (EUR 13.2 bn). This was followed by 6.7% growth in loans for condominiums (EUR 11.2 bn) and a 4.0% increase in loans for one-and two-family houses (EUR 23.2 bn). Loans granted for other residential properties such as building land matched the corresponding figure one year earlier of EUR 2.5 bn.

Commercial property loans: EUR 9 bn for business premises

The rise to EUR 30.3 bn in total commercial property loans granted between January and June of this year was mainly attributable to the increase in loans for business premises, which advanced by 40.6% year on year to EUR 9.0 bn. The growth rates in loans for office properties (EUR 14.8 bn) and hotels (EUR 2.4 bn) came to 9.6% and 9.1% respectively. New loans for industrial buildings (EUR 0.5 bn) and other commercially used properties (EUR 3.6 bn), on the other hand, were down year on year (-16.7% and -5.3% respectively).

Opposite trends in property finance portfolio

New residential property loans led to a moderate increase in total loans granted. As at 30 June 2026, the volume of loans granted for residential properties came to EUR 762.9 bn, which was 1.3% higher year on year. By contrast, total commercial property lending dropped by 3.5% to EUR 278.4 bn. Thus, new lending was again not enough to offset repayments. Overall, total property loans granted by the vdp member banks were, at EUR 1,041.3 bn, on a par with the previous year’s level.