Buying homes with credit, Albanians received 466 million euros from banks in 2023

2024-07-10 11:24:14Biznes SHKRUAR NGA REDAKSIA VOX

The home loan increased for the fourth year in a row, where the data of the Bank of Albania show that in 2023 the new historical record of 48.5 billion leks, or about 466 million euros, was reached. This increase in loans for the purchase of housing for financial markets expert Artur Ribaj is due to several factors, including the effect of the exchange rate.

"If we look at the effective interest rate published and set by the Bank of Albania, it can be seen that interest rates in the Lek currency are much more interesting compared to the European currency. And this also favors the lending ratio, which shows that we have more loans given in the Albanian currency, despite the fact that Real Estate prices continue to be quoted in euros" - says expert Ribaj for SCAN TV.

The data show that in the first months of 2024, home loans continued to grow, despite the fact that for two years the economy has entered a gradual cycle of monetary tightening. But why is the IMF concerned about the developments in the real estate market and the bank loan for properties, the expert emphasizes that this concern is right and even this organization suggests to the Bank of Albania the establishment of a countercyclical capital increase in the banking sector.

"There is an increase in the price of Real Estate in Albania and this when everything is at a fast pace. A stable performance is required to show that we will not have a decline in these values, since if we are exposed and face a shock in the price of Real Estate, a devaluation of them, then we would have an exposure of banks with the loans granted. However, we must be careful not to encourage companies to take loans by self-financing in this way and having a subsequent increase in the prices of unreal housing, when meanwhile in the IMF report the problem of saving people, which automatically indicates that it will affect the demand side for housing and as a result the decrease in demand for housing will bring a reduction in their price. But this exposes the banks, which they have taken as collateral, and this automatically brings risk" - adds financial markets expert Artur Ribaj.

Meanwhile, the Bank of Albania reports an increase in problem loans for 2024, with an indicator from 4.64% to 4.82%, which for expert Ribaj is not a big increase, but considering the reduction of the base interest rate by the European bank, it may is recovered if it is also reflected by the banks in the country.