One of the leading banks in Hungary, K&H, has disbursed more than HUF 225 billion in baby-expecting loans over the past three and a half years.Continue reading
In February, several major banks started to cut their lending rates, with some having lowered interest rates on home and personal loans, Hungarian economic site Világgazdaság reports. This is good news for consumers, as interest rates have been so high recently that many have been deterred from taking out loans.
After a series of interest rate hikes in 2022, stagnation followed in January, and now interest rates on household loans have started to fall, especially on mortgages and consumer-friendly personal loans. Since Hungarians typically buy property with some kind of loan, the interest rate cuts could be particularly good news for those who have so far been reluctant to buy a home this way because of the high interest rates.
According to an analysis by Bank360.hu, K&H Bank lowered the interest rates on mortgage loans, market green loans, and consumer-friendly home loans by one percentage point at the end of January. Erste Bank also saw a change, with the largest reduction of 1.18 percentage points for five-year housing loans and 0.73 to 0.98 percentage points for ten-year loans. Leading Hungarian bank OTP and Raiffeisen Bank also made similar changes.
However, it is difficult to say what the future will bring, whether there will be further reductions, or whether we should expect a rise again. According to Bank360.hu‘s analysis,
it is too early to rejoice, as interest rates are still at a high level: the average interest rate on home loans is still around 10 percent, and personal loans are hard to find below 15 percent.
Meanwhile, 2023 could be the year of renovations in the real estate market due to soaring energy costs, but in many cases financial assistance will be essential to pay for the rising costs of construction and materials, real estate agency Duna House revealed in its latest analysis. Fortunately, at the end of the year, the government extended the deadline for almost all non-refundable subsidies and discounted loan schemes for another two years, which could be a big help to Hungarians.
Those who do not qualify for family allowances should not be discouraged either. Single people or couples not planning to have children can choose from market loans, and as we can see from the data, these loans are available with slightly better interest rates now than before.
Featured photo via Pixabay
