Banks and credit unions SKOKs granted 43.3% fewer housing loans in May 2022 compared to May 2021, reports the Credit Information Bureau (BIK). In terms of the value of loans granted, the decrease was 38.6% year-on-year, and its value reached its lowest level since August 2020.
“For housing loans, May was very bad. And in numerical terms, even catastrophic, as banks granted only 13,642 loans in May. This is the least since February 2015, i.e. for 87 months. In value terms, banks granted housing loans worth PLN 4.727 billion in May. This is the least since August 2020”, says BIK chief analyst Waldemar Rogowski.
According to him, the situation in the housing loans market in terms of value is alleviated to some extent by high-value (above PLN 500K) loans.
“We are currently in the period of monetary policy tightening. We have already seen nine interest rate rises. The market is expecting at least a few more rises” predicts the analyst and points out that despite the rises, real interest rates are still negative (ca. -7%), and the difference between the nominal rate and the real rate is still growing.
“The latest June hike has not been reflected in lending itself yet, because it could not. The interest rate rises have reduced lending capacity very significantly. On top of this, there are the KNF regulations, tightening the requirements for calculating creditworthiness and having a negative impact on creditworthiness. All these factors have severely slowed down the lending activity. The value of lending in the first five months of 2022 is practically at the level of lending in the first five months of 2020”, says the analyst.
Rogowski predicts that the next months in the housing loan market will be extremely difficult. This will happen, in part, due to the announcements of some banks that they will provide housing loans only to their customers or for ‘green’ financing.
“May’s housing loans demand index hitting a historically low level (-51.6%) is a precondition for further significant cooling of demand in the housing loans market in the coming quarters, which will obviously negatively translate into the scale and value of lending”, predict BIK’s chief analyst.
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