Europeans cannot pay the rent and the loan

2024-04-24 10:47:24Biznes SHKRUAR NGA REDAKSIA VOX

According to the European Central Bank, the percentage of lower-income households expected to make late loan payments this year doubled to 30% compared to 2023.

According to an ECB study, the number of Eurozone consumers struggling to pay their housing obligations has increased after a long period of rising inflationary pressures and against a backdrop of rising borrowing costs.

The percentage of lower-income households expected to make late utility or rent payments rose to more than 20% in the first quarter, up from about 15% in 2023.

"Given the current and future effects of rising interest rates and the loss of purchasing power due to inflation, the ability of households to meet housing costs and mortgage payments is a source of concern," the report said.

Interest rate hikes aimed at curbing inflation have had a major impact on the real estate market, where new investments have fallen. This is putting increased pressure on rents, which were high in many European cities even before the rise in inflation.

The ECB is likely to start cutting interest rates in June, with some board members and many politicians concerned that tight monetary policy is putting too much pressure on the economy of the 20-member eurozone.