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Housing Loan Market Sets Records in November 2023

FINANCEHousing Loan Market Sets Records in November 2023

In November 2023, compared to November 2022, banks and credit unions issued more of all types of credit products in numerical terms: housing loans (+255.7%), installment loans (+ 91.9%), credit cards (+10.6%), and cash loans (+8.9%). From a value perspective, banks and credit unions also granted a higher value in all credit products: housing loans (+339.4%), installment loans (+41.3%), cash loans (+18.8%), and credit card limits (+15.2%).

From January to November 2023, banks and credit unions numerically issued more installment loans (+82.9%), issued more credit cards (+16.5%), more housing loans (+14.0%) and granted more cash loans (+7.4%). In terms of value, they granted a higher value of housing loans (+26.8%), higher value installment loans (25.3%), higher value in the credit card limit (+22.5%), and cash loans (+13.8%).

Continuation of growth in the cash loan market

The positive dynamics of November sales in numerical terms (+8.9%) and in value (+18.8%) confirm a good situation in the cash credit market, especially in value. The increases are both nominal and real. Inflation-adjusted, the annual growth dynamics of granted cash loans is about +12%. The situation in numerical terms is a little weaker, where cash loans in November recorded only a moderate increase. If we assess the state of the cash loan market after eleven months, the increase in value terms compared to the same period last year is +13.8%, while in numerical terms it is +7.4%. Therefore, the situation in the cash credit market is good.

Installment loans – on a high wave of growth especially in numerical terms

In the first 11 months of this year, the highest dynamics in value terms, similar to last year, were recorded by installment loans up to PLN 1,000 (+127.1%). Even more spectacular increases in the same range occurred in numerical terms, where the increase was (+206.4%). This high dynamism of low-amount installment loans is mostly the effect of transforming unpaid, interest-free obligations with a deferred payment date (BNPL) into installment credit through the purchase of the resulting receivables by banks. On the other hand, as in 2022, the sales dynamics in numerical terms were characterized by high-amount installment loans, i.e. from the range above PLN 10,000 (+5.1%). But they recorded a higher dynamic in value (+13.3%). These are mostly loans for the purchase of more expensive durable goods. Low-amount loans (up to PLN 1,000) account for 55.7% of the number and 9.6% of the value of granted installment loans. While high-amount loans (over PLN 10,000) are 2.4% of the number and 31.8% of the value of granted installment loans.

The average value of the cash loan granted in November 2023 was PLN 22,099 – an increase of 9.1% compared to November 2022. On the other hand, the average value of the installment loan granted in November 2023 is PLN 2,043 and it is lower than in November last year by 26.4%.

Housing loans – credit action at peaks – mainly due to high interest in 2% loans

For housing loans, November, like October, came out excellent, thereby confirming the very high revival in this market visible for several months. In numerical terms, banks granted 23.7 thousand loans. In value terms, banks granted housing loans for PLN 9.592 billion – which is the second highest amount after October 2023 in the entire history of the housing loan market. What are the main sources of record credit activity? There are several of them.

The large sales are the result of a revival in demand for housing loans as a result of an increase in lending capacity, which was contributed to by: a decrease in the WIBOR level, a real increase in salaries, and an extension of the average loan period. The increase in credit capacity has translated into an increase in the value of the loan granted and currently the average amount is PLN 404.3 thousand, being 23.5% higher than a year ago. At the same time, it is at a historically record level. The November credit activity shows the effect of launching the government’s “Loan 2%” Program. In November, according to our statistics, banks granted 13,912 loans under this Program (59% of all loans granted) for the amount of PLN 5.702 billion (60% of the total amount of loans granted). Those, who couldn’t use the “Loan 2%” program due to not meeting formal criteria, sped up their decision about taking a housing loan due to rising real estate prices

By November 30, 2023, banks had reported 1.153 million accounts covered by credit holidays worth PLN 285 billion.

Credit cards – slowing down a good run

In November 2023, the sales dynamics of credit cards compared to November 2022 were positive both in numerical terms (+10.6%) and in value (+15.2%). The dynamics from 11 months of 2023 compared to the same period last year are good: (+16.5%) in numerical terms and (+22.5%) in value terms. The Quality Index value in November was 4.11% and it is, apart from cash loans, the highest Index value of all product Indexes. In the annual term, the Index value worsened (rose) by (+0.12 pp).

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