Bigbank: People Are Buying Increasingly Expensive Homes, Average Loan Taken in June Already Exceeded 145,000 Euros

The purchase of new homes has been very active for the fourth consecutive month, with the average home loan taken in June being 145,309 euros, showing solid growth compared to April's 133,000 and May's 139,000, according to Bigbank's loan portfolio analysis.

Bigbank Estonia's director Arthur Taavet emphasizes that the home loan market has now been very active for four consecutive months. "There won't be any major summer break, as the increase in the number of new loan applications in June compared to the already strong April and May figures gives reason to expect the continuation of the positive trend," comments the bank director on the situation in the summer home loan market.

The average loan amount for June contracts was 145,309 euros, which is the highest in recent months and is, according to Taavet, primarily a sign of recovering investment confidence and growing purchasing power. "What brings joy most of all is that Estonian families' incomes are growing. Of course, we are also trying to contribute our part to ensure that the right home purchase succeeds," says Taavet, and adds that purchasing real estate with a long-term and favorable interest rate loan is certainly one of the most common ways to combat inflation.

As a concrete reason for the growth of Bigbank's loan volumes, Taavet points out that when buying a new home, they try to help those who cannot get a loan from large foreign banks for some reason. "Large banks often have very rigid frameworks, but Bigbank devotes more time and energy to reviewing each family's wishes and possibilities and finding solutions," explains the bank director, and reminds that a home loan application should actually always be sent to several banks. "The euros are the same at all banks, so everyone should take advantage of competition between banks in their own favor," encourages Bigbank's director.

Although home purchases and loan-taking have gained momentum this year, purchasing a new home remains inaccessible to many families. "Here, the Estonian state could consider allowing longer loan periods, for example forty or even fifty years, similar to Finland. This would bring down the monthly loan payment, which in turn would increase borrowing capacity," explains Arthur Taavet, how more people could be given the opportunity to purchase a new home.