Czech banks grant 33 pct less in mortgages in 2009

Banks had expected last year´s mortgage market to fall by as many as 40 percent. For this year they expect a slight growth.

The current decrease of the mortgage market could be predicted after the development in the past years. The volume of mortgages granted in the previous years was growing in reaction to the economic growth and low interest rates. Last year, however, banks introduced markedly stricter conditions for granting loans. In addition, citizens were more cautions as to making debts, the ministry said.

"Some potential customers have put off the purchase of real estate as they expect prices to fall further. The objective reason for the decrease in interest, mainly interest in newly constructed flats and houses, is connected with demographic development as the housing needs of the strong age-group of the 1970s have already been satisfied," Milena Brozova of the ministry said.

Mortgages granted to citizens in Kc bn:

Source: Local Development Ministry

Author: ČTK
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