Real estate financing granted by banks soared by 7.4% in July, at a faster pace on the foreign currency segment, according to NBR data.
Foreign currency real estate lending registered a spectacular increase in July, climbing by over 8% and thus topping 2.7 billion euros (the equivalent of 8.51 billion RON). During previous months, foreign currency real estate lending had advanced by around 2%-3%.
Thus, the increase of July is the biggest one posted in the past two years for this category of financing. It was only in March 2005 that foreign currency real estate loans took such a big leap (by 9%), but the basis of comparison was much smaller at that time.
Through the July increase, foreign currency financing reconfirms its role as the growth driver for real estate lending.
On the other hand, domestic currency-denominated real estate lending rose by only 2.2% in July, a pace similar to those registered during previous months.
Overall, the volume of real estate/mortgage loans released by banks climbed by 7.4% in July. At the end of this month, the value of real estate loans across the domestic banking system was 68% higher than the one reached a year ago. Practically, from July 2006, real estate financing expanded by 1.25 billion euros.
Owing to this pace, the overall volume of real estate loans went beyond the 3bn-euro threshold for the first time.
The 7.4% increase in real estate lending is the highest of the past sixteen months, with similar paces being recorded last summer.
In the first six months of this year, real estate lending had registered very slow growth, despite bankers' ever rising expectations related to this sector. On the other hand, another possible explanation for the slow dynamics of real estate financing would also be the way the National Bank collects data to report this statistical information. @N
