The volume of mortgage loans issued in Ukraine reached Hr 3.8 billion, or $136 million, in 2020 — which is 36% higher than in 2019, the National Bank of Ukraine reported.
In a national survey of banks, the NBU released its final findings for 2020 on Feb. 15. According to the bank, in December alone, banks gave out 743 mortgage loans of Hr 521 million, or $18.6 million.
The report also notes that the lending market in Ukraine is “concentrated” — almost 88% of new transactions ($118.5 million) in 2020 were concluded by five banks.
Last year, the average size of home loans also grew. If in 2019, the average size of a home loan was $18,500, that amount went up to $23,800 in 2020.
The average size of a mortgage loan for the purchase of primary real estate was $24,500; for the secondary market — $23,700.
Unsurprisingly, the largest amount of mortgage loans were issued in Ukraine’s capital Kyiv. There were 15,000 agreements totaling around $50 million, which is 37% of the total number of agreements. Coming in second place to Kyiv was Kyiv Oblast, with 646 agreements totaling $21 million, 16% of the total number of agreements.
Since last fall, a number of banks in Ukraine have started providing mortgages at a rate of 10%, but the Ukrainian government hopes to bring that rate down even further.
Starting in March, the Ukrainian government will launch the Affordable Mortgage program initiated by President Volodymyr Zelensky. It aims to simplify access to mortgages and offer a rate of up to 7% so that young families have the ability to buy housing and gain access to better living conditions.
Reimbursement for mortgages at 7% will become available from March 1, but the government will continue to work towards the possibility of mortgages at 5% in 2021.
“When we participated in the elections, we promised to… provide affordable loans and mortgages to young families, and to increase material security…” Zelensky said. “This year, we must continue to move towards the implementation of our (affordable mortgage) program provisions to build a successful country of happy people.”
