Housing loans increased by a tenth last year, and mortgages borrowed by a third, with most loans being used for second-hand housing, according to the latest data from the Central Statistical Office (CSO).
According to CSO data, the housing loan portfolio was HUF 3,324 billion on December 31, 2018, up 10.3 per cent from the end of 2017, while its ratio to GDP was one year earlier (7.9 per cent). By the end of 2018, foreign currency loans amounted to only HUF 3.5 billion.
Within the total loan portfolio
The proportion of unsecured loans continued to increase from 79 percent at the end of 2017 to over 82 percent.
The rating of home loans has changed since last year and the previous categories (problem-free, special attention, below average, dubious, bad) have been replaced by performing and non-performing.
Based on the new rating categories, the ratio of performing loans reached 95 percent, covering the problem-free loans ratio in 2017 (93 percent), while the 5.1 percent of defaulted exposures essentially follow the combined ratio of below-average, doubtful and bad ratings (4.4 percent in 2017). Restructuring mortgages accounted for 1.4 percent of overdrafts, compared with 33 percent for non-performing loans (in the latter case, every third loan was restructured).
According to the previous rating categories
By December 2017, 16,000 borrowers were overdue between 31 and 60 days, 29 thousand borrowers had over 61 days, and according to the new rating applied from 2018, the number was 34 thousand.
In 2018, the number of loans approved increased by 13 percent and one-third compared to the previous year. The average per capita loan reached HUF 7.9 million in 2018, which is HUF 1.2 million more than in 2017.
Last year, 8.4 percent and 7.8 percent of the total number of approved home loans were publicly subsidized, down 14 and 15 percent from the previous year. The number of government-subsidized loans has decreased by nearly one-third, by 29 per cent, since 2017, while the number of unsecured loans increased by nearly 17 thousand (20 per cent) and by HUF 238 billion (43 per cent).
In 2018, financial institutions disbursed nearly 109,000 home loans worth HUF 823 billion. Compared to the previous year, the number of loans increased by more than 4 thousand (4.1 percent) and its amount increased by HUF 218 billion (36 percent).
Home loans continued to dominate the purchase of used homes, with seven out of ten disbursed home loans serving this purpose. Loans for second-hand homes increased to HUF 596 billion last year, 35 percent more than a year earlier. Loans for construction increased by 4.8 per cent and their loans by 17 per cent. The average loan amount increased by HUF 500,000 to HUF 4.8 million.
Loans for the purchase of new homes increased faster
Nearly one-third, almost doubled. Accordingly, the amount of the loan for the purchase of a new home increased from 7.6 million to 11 million forints in one year. Together, loans for the construction or purchase of new homes accounted for nearly a quarter of the loan taken for the purchase of a second-hand home.
Based on a comparison of second-hand home purchase loans and second-hand home purchase transactions, home loan purchases exceed 40 percent.
The number of modernization and extension loans increased by 1,533 (11 percent) in 2018, up by 8.8 billion forints (a quarter), while the average loan value increased from 2.6 million to 2.9 million forints.
The average maturity of housing loans disbursed in 2017 was 14.8 years, rising to 15.3 years by the end of 2018. Housing loans have the longest maturity, reaching 17.5 years, followed by new home purchase loans (17.4 years), but the maturity of second-hand home loans is also over 15 years.