A Step Towards More Favorable Loans for Young People to Purchase Their First Property – What Do the Regulatory Changes Bring?
The National Bank of Serbia (NBS) has adopted a set of decisions, published in the Official Gazette No. 102 dated December 23, 2024, aimed at aligning regulations with the announced support program for young people purchasing their first residential property. These measures are part of a broader strategy to improve the living standards of young people and facilitate property acquisition.
Decision on Bank Capital Adequacy
Banks will apply a 35% risk weight to loans that do not exceed:
- 80% of the market value of the property subject to the mortgage,
- 90% of the value for loans granted under state support measures, or
- 99% of the value for loans intended for young people purchasing their first property.
Decision on Measures to Preserve and Strengthen Financial System Stability
Banks may grant housing loans up to:
- 90% of the value of the property within state support measures or for first property purchases,
- 99% of the property value under the state support program for young people.
Decision on Temporary Measures to Facilitate Access to Financing
The timeframe for applying these measures to housing loans has been extended – from the effective date of the decision until June 30, 2025.
Decision on Temporary Limitation of Interest Rates for Contracts with Natural Persons
This decision, effective from January 1 to December 31, 2025, introduces the following limitations:
- Variable interest rates for existing and new housing loans must not exceed 5%.
- Fixed interest rates for new housing loans are also capped at 5%.
Additionally, nominal interest rates for cash and consumer loans granted in dinars must not exceed: - 14.75% for loans in dinars,
- 7.05% for loans indexed in foreign currency or in foreign currency.
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