Swedbank: Average Home Loan Amount Rose by a Tenth Year-on-Year

According to Swedbank, strong growth continued in the home loan market in the first half of the year. The average home loan amount in Estonia rose above 154,000 euros, which is 11% higher than a year ago. In the first six months of the year, significantly more home loan agreements were concluded compared to last year—one third more.

The largest home loans continue to be taken by 31–35-year-olds, whose average loan amount reaches 179,000 euros. At the same time, the average loan amount increased in all age groups, with the largest jump occurring among 22–25-year-olds. In this age group, the average home loan amount grew 24% year-on-year, reaching 127,000 euros. The number of concluded agreements grew fastest among clients up to 30 years old.

"In the 31–35-year-old age group, people often reach a life stage where their current home becomes too small for the family and they seek larger living space. By this time, incomes have typically grown and opportunities for purchasing the next home have improved. At the same time, the activity of clients up to 30 years old shows that even first-time home buyers are acting more boldly in the market," said Anne Pärgma, Head of Home Loan Solutions at Swedbank.

Year-on-year, the share of clients who purchase a home with up to 15% own financing has increased. The share of home buyers with larger own financing has decreased slightly in the same period. At Swedbank, home loans are taken for an average of 26 years.

In the first half of the year, Swedbank also introduced several new solutions to make applying for a home loan easier for clients. A special home loan team was created for young clients, with specialists who help assess their opportunities, better understand the loan process, and move forward with more confidence toward a new home. Additionally, a solution was created that automatically compiles an initial home loan offer for clients, taking into account their actual income and obligations.

The home loan market was also active in Latvia and Lithuania, although the average home loan amounts there remain below Estonia's figures. In Latvia, the average home loan amount reached 100,000 euros and in Lithuania 133,000 euros, primarily reflecting the price level of the local real estate market.