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Loan Boom in January 2024: Housing Market Leads the Surge

FINANCELoan Boom in January 2024: Housing Market Leads the Surge

In January 2024, banks and credit unions granted more of all types of credit products than in January 2023: there was a numerical increase in housing loans (+304.9%), installment loans (+115.4%), cash loans (+14.7%), and credit cards (+3.8%). The value of all granted loans also increased: in housing loans (+403.4%), installment loans (+48.3%), cash loans (+23.5%), and credit card limits (+3.2%).

In January 2024, banks and credit unions granted significantly more of all types of loans, and at a higher value, than in January 2023.

The greatest dynamics of growth were observed in housing loans, both in terms of the number (+304.9%) and value (+403.4%). The high spike in credit activity could be due to rising real estate prices and greater availability of mortgage loans.

“As of January this year, the value of granted housing loans exceeded 10 billion PLN, thus making it the highest in history. Compared to January 2023 (2.05 billion PLN), the value of this year’s January credit action has increased fivefold,” says Sławomir Nosal, head of the Analysis Team at the Credit Information Bureau.

“The record January result is due to the steady processing of applications under last year’s Safe Credit 2% program. Although these loans could only be applied for until the end of December 2023, the lending process for housing loans in banks lasts 1 – 2 months from application. Therefore, the activation of loans applied for in December last year takes place in January and still in February,” explains Sławomir Nosal.

According to BIK statistics, the value of loans granted under the Safe Credit 2% program in January 2024 was 6.051 billion PLN, which is higher than in the previous months.

By mid-February, loans amounting to a total of 30.6 billion PLN were granted under this program.

Not only housing loans, but also cash, installment loans, and credit cards saw greater interest in January compared to January 2023.

Cash loans showed moderate growth in number (+14.7%) and value (+23.5%). Credit cards were the only type of loan that did not change significantly either in terms of number (+3.8%) or value (+3.2%).

Also noteworthy is the much higher number of installment loans granted than last year (+115.4%), whose value increased by almost half (+48%) compared to January of the previous year.

“In January this year, banks granted cash loans worth 6.44 billion PLN. This was less than the seven-month sales value from May to November 2023. The low value of the credit action in January is a typical phenomenon, although it must be admitted that compared to January in the previous three years, this year’s value of newly granted cash loans is clearly higher,” explains Slawek Nosal.

“Similarly, as with cash loans, this year’s value of newly granted installment loans is significantly higher (dynamics +48.3% YoY), compared to January of the previous three years. Although the sales value in January this year at the level of 2.07 billion PLN was lower than in November and December 2023, these are traditionally months with the highest annual sales of this product due to the shopping peak, holiday promotions in brick-and-mortar and online stores.”

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