The demand for housing loans is growing moderately

In 2020, SEB banka granted 129 million euros in home loans, thereby increasing the mortgage loan portfolio by 4.5%. More than half of the new loans were loans with the support of Altum, the bank informs. Most often (73% of cases), clients apply for financing for the purchase and repair of an apartment. More than 80% of such deals were concluded in Riga and Pieriga, and in more than half of the cases, customers chose an apartment in a house built after 2000. About a fifth of the allocated funding was directed to the purchase or repair of a private house, and 8% to the construction of a private house. “Of course, Covid-19 introduced adjustments to our clients’ plans. After the first emergency situation was announced in March last year, we observed a significant drop in the demand for home loans. Ignorance and the unpredictability of the situation were mostly the reason why people became more cautious and temporarily postponed their plans to buy homes. As in any during the crisis, there are also customers whose incomes have decreased significantly in the spring of 2020. In total, more than 1,900 customers received support the market continued to develop positively throughout the second half of the year. However, in 2020, the volume of new housing loans at SEB banka was 11% lower than in 2019”, comments SEB banka board member Arnis Škapars. “Currently, we see that the demand for financing continues to be stable, and therefore we predict a moderate increase in the future as well. People have been able to adapt to the new reality, moreover, if the family has had the desire to improve their living conditions and purposefully created savings for the first installment, then at least with time lag, but this plan is being implemented. Especially if the household income is not significantly affected by the Covid-19 pandemic. In addition, the house has become a kindergarten, a school, and an office. This, of course, contributes to the demand for funding for the repair of the existing property or the purchase of a new one.” Altum’s support plays an increasingly important role in the development of lending. Of the loans granted last year, 42% were loans with Altum guarantees for families, and another 12% – with Altum guarantees for young professionals. Along with the introduction of a new support mechanism for families with many children – the subsidy “Balsts” – the interest of customers in this program is also visible. Read the full article here.