The mortgage market in Croatia is showing stable activity thanks to government programs, favorable conditions offered by banks, and steady demand from both citizens and foreigners.
Since 2017, the SSK (Subvencioniranje stambenih kredita) mortgage subsidy has been in effect, whereby the state compensates up to 50% of the monthly annuity for the first five years on loans of up to €100,000 issued to first-time residents. Pilot assessments show that these measures have led to an increase in housing prices, especially in large cities.
Terms and conditions of mortgage programs at banks
HPB (Hrvatska poštanska banka):
Fixed rate from 2.89%, APR (effective) — 3.00%, term up to 30 years. No property appraisal costs.
OTP banka:
Rate 4.69%, APR 4.93%, term up to 20 years, amount up to €200,000.
Agram Banka:
For new customers, the APR is 5.49% for a 20-year loan (example — €50,000).
Podravska banka:
Fixed rate of 5.90%, APR — 6.15%, no issuance fee.
Conditions for foreigners
Citizens of the EU, Switzerland, Iceland, Norway, and Liechtenstein can obtain a mortgage on the same terms as Croatians. For non-residents, LTV is 50–70%, with state control over the project; a residence permit or long-term stay may be required.
History of rates: from 2017 to 2025
2017–2019: rates were fixed below 3%, especially in HPB, thanks to subsidies and other benefits.
2020–2022: rates rose gradually in line with Eurobonds and monetary easing, reaching 4–5%.
2023–2025: current rates are fixed at 2.9–5.9%, ECA — 3–6%, reflecting tight credit conditions.
The Croatian mortgage market combines state support (SSK), a wide range of offers from banks, and accessibility for foreign buyers, especially from the EU. As a result, potential borrowers can expect rates ranging from 2.9% to 6%, fixed for the entire term of the loan, which is 20 to 30 years.
Source: http://relocation.com.ua/mortgages-in-croatia-overview-of-conditions-and-trends/
In January-September 2021, Ukrainian banks issued 7,500 mortgage loans worth UAH 6.07 billion, which is twice as much as in the nine months ending September 30, 2020 in terms of the number of such loans and more than 2.7 times in terms of their volume, the National Bank of Ukraine (NBU) said on Tuesday in a monthly survey of banks.According to the survey, lending in September remained almost at the level of the previous month: in September, 943 mortgage loans were issued for UAH 812 million, compared with 944 loans for UAH 844.3 million a month earlier.The press service of the NBU said that the mortgage lending market remains concentrated: the five most active banks have concluded 90% of new transactions.Loans for the purchase of housing in the secondary real estate market are still ahead of the primary market: in September, their share exceeded 88% of all mortgage loans provided both in terms of the number of contracts and in terms of money volume, the NBU said in the press release.According to the survey, the average size of a loan for the purchase of housing in September was lower than in August – UAH 861,100 versus UAH 889,700 due to an increase in the share of mortgage lending in the regions and a decrease in the average contract amount in Kyiv. According to the NBU, in September the average effective rate of a mortgage loan in the secondary market fell by 0.3 percentage points, to 13.62% in September, and in the primary market – by 1.5 percentage points, to 15.38%.
Ukrainian banks in January-August 2021 issued 6,570 mortgage loans worth over UAH 5.2 billion, which is 2.2 times higher than the figure for eight months of 2020 in terms of the number of such loans and 2.9 times – by volume, the National Bank of Ukraine (NBU) reported following a monthly survey of Banks.
According to it, in August, 944 mortgage loans were issued for UAH 830.1 million, compared with 531 loans for UAH 358.1 million a month earlier.
The press service noted that the mortgage lending market remains concentrated: the five most active banks have concluded 89% of new transactions.
It is indicated that loans for the purchase of housing in the secondary real estate market remain the main driver of the market: in August, their share exceeded 90% of all mortgage loans provided both in terms of the number of contracts and in terms of monetary volume, the press release notes.
The results of the survey indicate that the average size of a loan for the purchase of housing in August increased to UAH 879,300 from UAH 793,800.
According to the NBU, in August the average effective rate of a mortgage loan in the secondary market rose to 13.60% compared to 13.35% in July, and in the primary market fell to 15.9% from 16.82%.
The mortgage program, which is being implemented by the government at the initiative of the president of Ukraine through the Entrepreneurship Development Fund, did not affect housing sales, Viktoria Volkovska, the director general of the Finance and Investment Management Association (FIMA), has told Interfax-Ukraine.
According to FIMA research, 53.8% of surveyed managers of construction financing funds did not notice the impact of “mortgage at 7%” on sales and do not expect it in the future. At the same time, 38.5% still hope that it will have an impact on the volume of construction and sales. Only 7.7% are optimistic about the program and consider it as the beginning of active growth in the industry.
“Some 38.5% of respondents see the reason for the not very successful start of the “mortgage at 7%” as the conditions of the program do not suit the borrowers,” Volkovska said.
At the same time, 30.8% of respondents indicated that the terms of the program do not suit lenders and developers, and 7.7% simply believe that the program does not work.
“The fact that borrowers cannot pass financial scoring at the bank because of their salaries in envelopes is not considered a problem,” the expert emphasized.
The FIMA study is based on an online survey of construction finance fund managers, conducted following the results of the first half of 2021.
The Finance and Investment Management Association (FIMA) was established in May 2020. It unites 41 financial companies-managers of construction financing funds in Kyiv, Lviv, Odesa, Dnipropetrovsk, Khmelnytsky and Kharkiv.
The volume of mortgage lending in April 2021 amounted to UAH 789.1 million, which is a third more than in March and 10 times more than in April 2020, when the issuance of new mortgage loans almost stopped, according to the results of the National Bank of Ukraine (NBU) survey of banks.
According to the NBU on Wednesday, 997 agreements were concluded in April, which is a third more than last month and 7.1 times more than in April last year.
The NBU noted that in general, over the four months, banks issued 2,808 mortgage loans totaling UAH 2.2 billion, which is 2 times more in terms of the number of agreements and almost 3 times more in monetary terms compared to the corresponding period last year.
According to the survey, 90% of mortgage agreements in April were drawn up with five banks, which indicates the concentration of the mortgage lending market.
The NBU said that in April, the volume of loan issuance for the purchase of primary real estate increased by 1.5 times, to UAH 43.2 million, and secondary real estate – by a third, to UAH 168.5 million.
According to the results, the secondary housing market continues to dominate significantly in terms of the number and volume of lending, in particular, the share of mortgage agreements for the purchase of housing in the secondary market in February amounted to about 87% in terms of all new loans.
It is indicated that the average amount of a loan for the purchase of housing continues to grow and in April it amounted to UAH 791,000, including the average amount of a new mortgage loan for the purchase of primary real estate in the reporting month amounted to UAH 925,000, and secondary real estate – UAH 771,000.
According to the central bank, in April the average effective rate of a mortgage loan in the secondary market fell to 13.5% compared to 14.0% in March, and in the primary market it remained at about 17.4%.
The Verkhovna Rada of Ukraine (Parliament) adopted at first reading bill No. 5308, which proposes the issue of securities for UAH 20 billion for the implementation of the Affordable Mortgage president’s program.
The bill in the first reading was supported by 263 MPs. “The bill provides that the Ministry of Finance shall issue government domestic loan bonds… with the subsequent acquisition of shares in state ownership in exchange for the shares of the additional issue of Ukrainian Financial Housing Company to provide citizens with housing and resolve issues of financial and economic activities of the company in connection with the accession to the State Mortgage Institution,” one of the authors of the bill, a member of the Rada budget committee Lesia Zaburanna said from the rostrum of parliament.
Currently, the activities of the State Mortgage Institution are unprofitable, she added.
According to the lawmaker, the adoption of this bill will allow continuing the implementation of existing state programs and will allow in the short term providing about 8,000 mortgage loans for the purchase of housing. It would be possible to buy 12,000 apartments for subsequent transfer to financial leasing.
