Mortgages will tighten
The day after tomorrow, the Czechs will have a slightly lower chance of getting a mortgage. The Czech National Bank will tighten the limits of credit indicators for the provision of mortgages. Stricter conditions will make it more difficult or impossible for up to a tenth of applicants to access a mortgage.
However, the Czech National Bank will also significantly increase its key interest rates tomorrow, quite possibly above the level of five percent. The CNB thus wants to fight increasingly rapid inflation.
At the same time, about a third of applicants no longer reach mortgages. However, due to the aforementioned tightening of conditions and further growth in the CNB’s interest rate on the mortgage, half of the applicants will soon not be able to reach it.
The average mortgage rate will soon be around six percent, the highest since the turn of the millennium. In addition, the conditions for providing mortgages will be tightened. For the first time in history, it will take place in the legal form the day after tomorrow, as so far the CNB has tightened conditions only in the form of recommendations.
The tightening of conditions for the provision of mortgages, which individual commercial banks now simply have to respect, as they are of a legal nature, consists of a set of measures.
While, for example, banks can now provide a mortgage loan of up to 90 percent of the value of a mortgaged property, from tomorrow it will be only up to 80 percent. However, young people under the age of 36 will have an exception – the 90 percent limit still applies to them.
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