Yet in 2021, there was a lot of talk about two factors that were to affect the mortgage market.
What has changed on the mortgage market in first two quarters of 2022?
Yet in 2021, there was a lot of talk about two factors that were to affect the mortgage market: the Polish New Deal (in real terms – lower income, and therefore lower creditworthiness among existing clients with average and higher income), and rising interest rates. Especially the rates, or more precisely: the WIBOR rates, caused growing concerns among customers that time.
The installments of the forecast loans grew at a dynamic pace, and at the same time the creditworthiness decreased. When president Putin was gathering troops at the border, and especially when he announced that the maneuvers would end, WIBOR futures began to stabilize, and at some point in February even fell. So it was possible to estimate the real maximum interest rates.
However, the last days of February and the situation of the military conflict just beyond the eastern border of Poland rocked the inflation forecasts again. The justifications from the last meeting of the Monetary Policy Council additionally increased concerns about the level of interest rates in the near term, which was again visible in the growing WIBOR futures contracts.
Unfortunately, that’s not end of the list. Last week, the Polish Financial Supervision Authority issued a new recommendation for banks, in which the institution suggests calculating the capacity of mortgage installments, increased by an additional 5% (previously it was 2.5%). At the same time, it is recommended to update the cost of living in the calculation of creditworthiness: obviously by increasing it, which is related to inflation.
Above recommendations are to be implemented by April 2022 at the latest. All these restrictions will significantly affect the decline in creditworthiness, already limited by a higher interest rates.
Due to the introduction of the recommendation, credit advisers suggest to those who are wondering if this is a good time to take out a loan, to submit their applications in March. Why? Already in April, the creditworthiness calculated according to the new rules will be lower – which may make it more difficult to obtain financing.
For example, if someone wanted to take out a loan of PLN 500,000 today and currently has the capacity calculated at PLN 530,000, this level will be unattainable in April.
It is impossible to say at the moment whether the capacity calculated from April according to new rules will in this case, obtain either PLN 390,000 or PLN 440,000 – this can be assessed in the calculators introduced by the banks at the beginning of the month.
The positive news is that the margins on loans are falling and the terms of analyzing applications have shrunk significantly.
So is it a good time to take out a loan? It is always a good time for it – remember that the interest rate in Poland may be fixed for 5 years, or it may be variable – so it will fall as interest rates fall in the future. It is also important that such a loan can be transferred to another bank at any time – provided that it is justified, for example, by a lower margin and / or a lower interest rate.