New mortgage loans worth approximately EUR 1.1 billion were granted in the first three months of 2024, up about 29% compared to the level of Q1 2023, according to a market report released by financial consultant SVN Romania | Credit & Financial Solutions. Refinancings, conversions, transfers, and restructurings were excluded from this volume.
In total, reports released by the National Bank of Romania, including refinancings, conversions, transfers, and restructurings, indicate a total volume of mortgages granted in the first quarter of this year of EUR 2.15 billion, up 95% compared to EUR 1.1 billion registered in Q1 last year.
Alexandru Radulescu, managing partner SVN Romania | Credit & Financial Solutions, commented: “The local mortgage market has been in a strong recovery for several months now, also corroborated with the increase in the number of homes sold, which was almost 19% in the first three months of this year compared to the similar period from 2023. Considering the results from the first quarter of this year, 2024 will be a year with a strong revival, preparing the ground for a 2025 that could bring a new record of mortgage loans granted, depending on the size of the housing stock for sale and the local macroeconomic evolutions.”
The growth of the local mortgage market in the first months of 2024 was registered in a context in which fixed interest rates (which hold the majority in terms of the mortgage loans type contracted this year) registered new decreases. Thus, the 5% threshold was ‘broken,’ with the best current mortgage offer with a fixed interest rate being of 4.9% a year.
SVN Credit Romania consultants estimate that variable interest rates will also decrease, most likely in the last quarter of this year, but without registering a significant level of decline – thus, fixed interest rates are expected to remain the most advantageous in the next 12 months.
According to National Bank data, a total of EUR 6.4 billion mortgages were granted in 2023. SVN Credit Romania estimates that new mortgages had a value of approximately EUR 3 billion, or about 46% of the total registered volume.
The average mortgage loan granted at a national level in 2023 had a value of about EUR 62,000, while the average price of a property traded through a mortgage loan in 2023 was EUR 85,000, up from EUR 82,000 in 2022, according to SVN Credit calculations. In total, approximately 48,000 new mortgage loans were granted in Romania last year, compared to a level of roughly 55,000 in 2022.
