CROATIA CONTINUES SUBSIDING HOUSING LOANS

04. Feb 2022
Photo: Pixabay (Zagreb)

Citizens of Croatia will have oportunity this year to obtain subsidies for the purchase of apartments and houses, as well as for the construction of houses, The Ministry of Construction of the Republic of Croatia announced. This year, the government has set up 50 million kunas for this purpose (about 6.6 million euros). According to the bankar.me portal, the biggest amount for which subsidies can be acquired is 100,000 euros, which is 1,500 euros per square meter.

The application process begins in March, with credit institutions previously submitting offers for citizens to borrow, alongside with state subsidies for the purchase and building of real estate.

The subsidies are intended to aid in the demographic renewal of society, as well as the urban redevelopment of settlements and the reduction of young family migration abroad. The subsidy is granted for the first five years of debt repayment, with the option of a two-year extension for each newborn or adopted kid during that time, or for one year if the family received or adopted another child, or if one of the family members remained incapacitated throughout that time.

All citizens under the age of 45 who do not own an apartment or a house can become the subsidie beneficiaries. The maximum loan repayment period is 15 years. Since 2017, Croatian citizens have received subsidies totaling more than 60 million euros.

For real estate in underdeveloped areas, the largest percentages range from 30 to 51 percent of the loan installment. In locations like Zagreb, monthly loan installments of 30% are granted for real estate. The average yearly Effective Interest Rate (EIR) has decreased since the subsidies were awarded, which is a positive trend. In 2021, it was 2.17 percent, while in 2017 it was 3.35 percent. So far, more than 22,000 housing loan subsidies have been approved in Croatia.

 

Source: bankar.me

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