The lowest standard leu-denominated credit offer is currently displayed by state-owned CEC Bank, with an effective interest of 5.53% per annum, namely a monthly installment of below RON1,000 for a 30-year loan of RON178,000 (the equivalent of EUR40,000).
The cheapest standard euro-denominated mortgage carries a 5.91% effective interest rate per year and is included in Italy’s Veneto Banca’s offer.
Leu mortgages matched up euro-denominated ones in terms of effective costs in spring, as loan prices fell into line with the trend of monetary market interest rates, which hit all-time lows amid the monetary easing carried out by the central bank and the surplus cash in the banking system.
“Those opting for a euro credit are mainly affluent clients. These have a higher level of financial education and weigh foreign currency risks against monetary ones, considering Robor is not the most stable of indicators,” comments Anca Bidian, chief executive officer of loan broker Kiwi Finance.
Monetary interest rates have generally followed a downward trend in the past year, but clients that opted for a leu loan also faced periods of volatility.
Average interest rates for lei and euro revolved around 5.5% per annum in March-May, according to the central bank’s latest data, but current offers are suggesting a widening interest rate spread in favor of leu loans.
Sales of loans in lei sped up visibly in the past year, spurred inclusively by the shift to lei of funding released through the First Home scheme.
Leu mortgages have now come to account for 12% of the total stock of funding granted for house acquisition. The stock of leu loans granted by banks for home purchases stands at RON5 billion.
(English version by Catalina Apostoiu)