2024-09-14 19:26:30
The Bulgarian National Bank is introducing new measures to tighten housing lending aimed at customers in order to limit potential risks to the banking system. Banker Levon Hampartzumyan commented on the topic to NOVA.
“If we can summarize these requirements, they are that people do not take out mortgages at the edge of their means. This means having buffers in the finances of the borrower himself, so that if the situation worsens, they can cover loan installments,” Hampartzumyan said.
According to the banker, the Bulgarian National Bank has observed a rather sharp increase in credit in recent years. “The BNB tries indirectly, through the tools it has, to influence the motivation of market participants. At the moment, more on the motivation of buyers. These are a set of measures that protect customers from themselves,” he specified.
“Banks operate with 20% of their own money, the rest is our money sitting there. So, from that point of view, I think they are not doing anything crazy. But of course, in a situation where the market is growing, they are involved in that thing, and I wouldn’t say they don’t have input. But this contribution is the normal contribution in growing markets,” Hampartzumyan added.
When asked if it is really worth investing in real estate at the moment, the banker replied: “Like any investment, you take a certain risk. That’s why I divide things into two. He who buys is for his own use. In Southern Europe, we are used to owning homes. It’s a cultural difference. Someone who took out a 30-year mortgage, of course, over the years the interest rates may go up, but they took it out to live there. And he will suffer some adversity. One who has taken, however, for the purpose of speculating, in the good sense of the word, is there like any other business speculation. It can have a positive effect, but it can also have a negative effect, including a catastrophic one.”
Regarding how real the prices of the properties are, according to Hampartzumyan, the real prices are those that the buyers pay, supported by the banks.
“What can happen from these actions of the BNB is a cooling of the market’s enthusiasm, but not much,” he added.