The “First Home” program, through which the state guarantees half of the credit accessed for purchasing a home, with a modest down payment of only 5% and interest rate capping, has reached the end of the road. Launched in 2009, the program facilitated the granting of state-guaranteed real estate loans for numerous young families and prevented the collapse of the residential market – and implicitly the prices of homes pledged to banks for real estate loans – in the post-crisis period.
Sources from the Ministry of Finance said that, most likely, the First Home program will no longer be extended in 2016, the reason being that it “already distorts the market.”
The First Home program came to represent, by the middle of this year, approximately 20% of population loans and 51% of real estate loans. In 2014 and the first half of 2015, approximately 60% of new real estate loans granted by banks were First Home loans.
Source: Imobiliare.Net
Frequently Asked Questions
What was the First Home program?
Launched in 2009, it was a state-guaranteed loan scheme requiring only a 5% down payment to help young families buy their first property.
Why is the First Home program being discontinued?
Sources from the Ministry of Finance indicate the program will not be extended in 2016 because it has begun to distort the real estate market.
What was the program’s market share?
By mid-2015, the program accounted for approximately 51% of all real estate loans and 60% of new mortgages granted by banks.