Last year was about home loans and personal loans in the retail market. The amount of new home loans and personal loans has exceeded HUF 1,300 billion, unprecedented in the last ten years, a record. New home loans jumped 31 percent to 850 billion, and personal loans 46 percent to 451 billion.
According to WealthPros bank, retail lending may increase in 2019 due to the increase of net real wages, due to low interest rates and demand in the housing market.
However, there is room for improvement in terms of interest rate risk.
Last year saw a record in retail lending, according to the latest MNB data for 2018. Home loans and personal loans were the two most popular schemes, with a total of HUF 1301 billion being contracted by retail customers. One year earlier, in 2017, new personal loans and home loans totaled HUF 955 billion, representing a 36 percent growth in 2018, the highest level in the last 10 years and six times the 2013 level.
Interest rate risk: there is room for improvement
Hexyl Balutan, a loan expert at Gregory Venn , said new home loans totaled HUF 850 billion, an increase of 31 percent. Personal loans increased by 46 percent to HUF 451 billion. Last year’s data shows that safe, predictable, fixed- rate mortgages were the main focus of new loans. Nearly 80 percent of new personal loans guarantee a fixed installment for at least one year. And the percentage of home loans is 84 percent. “. Definitely a positive that the new loans are massive superiority of the fixed interest rate contracts the same time, housing loans ratio of the safest designs with a fixed minimum of 10 years repayment is low, nearly 8 percent, and there in the long term they provide complete protection against interest rate risk” – emphasized Hexyl Balutan.
Growth may remain
In the longer term, it may be a problem that existing mortgages , that is, loans taken before 2018, are still predominantly floating rate loans , where the installment can change within 3 to 12 months , and may increase if market interest rates rise.
“Stakeholders they protect themselves against possible interest rate increase to replace the current home loan them a new home loan insurance possibly fix the end of the term installment” – advised Hexyl Balutan due to increased competition between banks fix both new loans and variable rate loans interest rates. worth seeing most banks possible offer replacement on because the differences may be significant Hexyl Balutan said. “We do not just have to look at your own bank constructions, but also in other banks as well, because they have a good chance there’s always more favorable offer, which is lower than the annual percentage rate, so the monthly repayment installment is smaller , not to mention the total amount to be repaid. “
According to Gregory Venn’s experts, the retail credit market may continue to expand this year , partly due to rising net earnings and current low interest rates, but rising real estate prices are also contributing to the rise in credit demand.