Mortgage lending recovers slowly. That is why in 2011, rates are still high and credit conditions remain extremely tight.
Boom of mortgage lending in 2011 will not. Although the number of bank loans will grow at least twice (there are already 25), it does not mean that the mortgage loans will buy up vying with each other - as it was in 2006 - 2007, wrote Money.
Moreover, there are three reasons for this. First - sluggish real estate market, the banks fear fall in the value of collateral property. The second reason - lack of "long" and cheap resources from the banks. Recall that they are allowed to lend to individual persons only in UAH, while most mortgage loans were foreign currency. The third reason - the sharply increased demands on borrowers' solvency.
And yet a little credit for the purchase of residential property given, with priority for bankers in 2011 will remain the secondary market. Credits for "a primary" will be in 2011, issued only in special programs, and under more stringent conditions (for example, with an initial contribution of up to 50 - 70%). Exceptions to the "primary" program will be a special relationship with the bank with a company-builder.
Unlikely to be renewed actively lending purchases of land, and suburban real estate. Most banks will finance the purchase or construction of single family homes and only if the provision of additional collateral or guarantee.
And yet, slowly but surely, mortgage rates will move down. "We estimate that in early 2011, rates will average 18 - 19% per annum, but by the end of the year they could drop to 3 - 4 percentage points" - predicts the head of department of strategic development and marketing of retail business FUIB Valery Patsuy.
Another question is at what level will the effective rate, which includes all bank charges and insurance costs? For example, now the real rate can reach 20 - 25% and sometimes 30% per annum. This means that even at nominal 13% per annum in real borrower will pay the bank and its inevitable partner, 17 - 20% per year.
In addition, lower interest on loans, banks will compensate for the introduction of floating rates, which vary depending on the current yield of deposits. For the borrower this means only one thing: he'll have to settle for a possible rise in mortgages with virtually no warning. True, just "floating" mortgage may get cheaper - if it be the good will of the creditor. The initial payment in 2011 and will start with 30%.
Its decline to 20% possible, but only when activated the real estate market. Private banks with poor quality loan portfolio and do not want to aggravate it further, and at all will require an advance payment of 40 - 50%. High, up to 50 - 70% down payment and will remain in lending to purchase flats in the primary market. Especially if the readiness of such objects below 80 - 90%.
Maximum loan terms will remain in the range 15 - 20 years and the rate on the most "long" loans will be floating or higher in 1 - 2 percentage points than for mortgage loans at 5 - 10 years. Loans for 25 years, will be exotic, accessible only to borrowers with impeccable ability to pay.
Borrowers generally have hard, banks will be harsh with them in the selection of candidates. Age - at least 23 - 25 years, officially confirmed by revenue - more than 4 - 5 thousand UAH. per month, the experience of the last place of work - from 1 - 2 years old, and very likely the requirement of surety.
The presence of the existing property (real estate, land, cars, etc.) would be welcome, but at an insufficient level of income even further pledge not inclined to bank in favor of applying for a loan.
It is obvious that obtaining a mortgage loan in 2011 - not the best solution. "I do not recommend anyone to take credit for 20 years at an interest rate of 20%. An exception may only be the case if the borrower is not enough 20 - 30% of the amount for home purchase, and he is confident that a couple of years to repay a loan," - - the chairman of the Board of Ukrsotsbank Boris Tymonkin. Giving the bank an annual 20%, the borrower is over 20 years of overpaying 150% of the cost of housing, while annuity scheme - all 250%. An incredible amount.
If, however, says Mr. Tymonkin, the loan to take a couple of years, and 20 - 30% of the price, then according to our calculations, the overpayment will be about 3 - 5% of the purchase price. And it is quite comparable to the possible over the next couple of years, price increases.
Anything like an acceptable bankers call rate mortgage at 12 - 14% annually in local currency. But wait for such generosity from the banks is not until late 2011 - early 2012. The fact that interest rates depend directly on the deposit. And although the return of deposits will continue to fall, but not below the forecast inflation for 2011, that is - at least 11 - 12% annually in local currency. This means that the interest on loans snap in the range 15 - 16%.
Ease mortgage terms could state. For example, the desire of the Cabinet to allocate the fund promote youth construction 103.339 million hryvnia for partial compensation of interest rates of loans of commercial banks. Another question that this initiative should not only be fixed by a string budget, but actually financed.
Encouraged by the intention of the State Mortgage Institution to send nearly 1 billion USD. for the completion of unfinished housing, and about 1 billion UAH. for lending to its purchase. Given the attractiveness of refinancing (11%), this program will make a worthy competition to the banks and force them to curb their appetites. But who would buy bonds, which will release the SMI? In 2009 - 2010 years in relation to their particular excitement was not observed.
So that the mortgage this year clearly remain expensive. And decided on the purchase of housing can only be achieved if there is a chance to make right at least 50 - 70% of its value and pay off the loan for 5 - 7 years. This can be justified if the real estate prices in the coming year to resume growth.
In addition, the proposal may appear from the banks to sell loans mortgage home, which they have accumulated an amount of several billion. Peak sales "confiscated" have it in 2011, and it is possible that the collateral property will be offered a loyal interest rates, and at prices much more attractive market.