The demand for bigger real estates, mostly two-bedroom, over 90 sqm homes, has been on the rise since the start of 2019, Postbank’s data shows. Monolithic homes in new buildings in major cities enjoy the greatest interest. Buyers have increasingly stricter criteria for the quality of construction and life in the vicinity of the real property. The top three factors for a home purchase are infrastructure, green areas and price, shows the data of a national representative online survey in Bulgaria, conducted by Gemius Bulgaria and commissioned by Postbank.
Real estate sale prices increased in the first nine months of 2019, as Postbank’s data indicates a 7.53% hike in the average price per sqm of the financed homes in Sofia, compared to the same period last year. This trend and the demand for bigger homes led to an increase in the average amount of mortgage loans consumers applied for, which, according to Postbank’s data, went up by 10%, compared to the same period in 2018.
An increasing number of consumers are preferring bank loans to finance a home purchase thanks to the increasingly attractive interest conditions, the stable banking system and the average wage rise. Postbank reports a 44% hike in the volume of housing loan requests in January-September 2019, compared to the first nine months of 2018. The increased interest in bank financing is confirmed by Gemius Bulgaria’s survey, which shows that 48% of the respondents planning to buy a new home point to housing loans as a main financing means. The survey also shows that consumers are laying increasing weight on individual approach and consultation on the loan application process when selecting a bank. To meet their expectations, Postbank offers a wide variety of credit products, striving to provide personalized solutions with added value adjusted to consumers’ needs and preferences. In order to realize this goal and make it easier for its clients, for over five years, Postbank has been successfully developing its network of unique for the Bulgarian market specialized housing lending centres where clients can receive comprehensive assistance in the process of financing their new home. The clients, who prefer the digital solutions and the fast and convenient servicing they provide, can opt for an online application, consultation and preliminary loan approval on the basis of their income level when applying for a loan via Postbank’s webpage or Bulgaria’s first banking chatbot, EVA.
The survey also shows that family people of active age of 30-40 years, with BGN 900-2,000 average monthly income most often opt for housing loans. Apart from the family activities, a large number of the respondents say, their key interests are related to sports (46%), reading books (35%) and tourism (30%). Their leisure time budget is BGN 300-800 a month, as they can afford an average of up to two trips abroad and two trips in Bulgaria a year. There is a positive trend of consumers who are increasingly often taking into consideration their income when applying for a loan and finance a home purchase with about 30% own capital, Postbank points out.
The purchase of a new home is an important stage in life, which requires a good plan and selecting the most suitable credit offer. One needs a reliable financial partner and consultant to go through the process more easily.
Postbank’s experts give you three key steps to help you in the selection of a real property and a housing loan.
1. Set clear criteria for the real property you are seeking – for instance, a maximum price, location, type of construction, home area, number of rooms, etc. If you are planning to borrow a bank loan to purchase the real property, Postbank can guide you on the loan amount you can receive even if you have not chosen the property yet. This will make looking for a new home easier because you will know the price range that corresponds to your financial capacity.
2. Consult with lending experts – the experts in the bank offices and mostly the housing lending centres will assist you throughout the entire process of loan application and utilization – from the preparation of the required documents to receiving the loan. They will also guide you on the most favourable decisions in loan repayment such as using a convenient mobile banking functionality and package programmes with preferences for banking services.
3. Plan carefully the choice of a credit offer and a bank – the average repayment period of housing loans is about 20 years. This is why, when choosing a credit offer, it is important to consider not only the current conditions, but also the prospects of repaying the loan in the long run. It is important to choose a stable financing institution with proven experience in the area of housing lending. The possible changes in the loan interest rate in the future should also be taken into consideration. For instance, a loan with a floating interest rate could be more attractive than a loan with a fixed interest rate. However, in the long run, the fixed interest rate means better protection and guarantees that instalments will not increase during the loan repayment period. A life insurance, part of the loan, also ensures additional protection because it covers the loan instalments in case of unexpected events.
Postbank offers an opportunity to choose the most suitable financial option, as clients can benefit from the security of a fixed interest rate for up to five years or prefer an attractive promotional offer with a floating interest rate in BGN. The bank will cover up to BGN 1,000 notary costs related to clients’ real property mortgage only of housing loan applications submitted in November. Housing loans provide additional advantages such as an option for discounts via package programmes for complex banking, protection ensured by Life insurance packages, etc. Consumers can apply also for the unique New Saving Housing Loan, which enables them to profit more from their savings, using them any time for other plans.