The state is set to subsidize 66% of interest rates on homebuyers loans for first-time buyers. The only condition is that loans cannot exceed €100,000 denominated in kuna, while interest rates will go no higher than 5% yearly and will be fixed for the first four years, the Vecernji List daily reports
The condition? Real-estates must be newly-built and cannot exceed €1,900/m2, including VAT. These are the main amendments aimed at kick-starting the housing market and sale of newly built homes, set to go into procedure next week. In short, this means that first-time buyers will pay interest rates of up to 1.7% for the first four years.
The precise interest rate will depend on the banks bidding in the public tender, while the state will choose the lowest one up for offer. However, the state subsidy is not non-returnable.
The Vecernji reports that the subsidized amount for homebuyers using these loans will have to be paid back to the state within five years after the loan expiry. Early plans see this amount being paid back without interest and the highest payable amount will not exceed the interest that applies in accordance with the Law on Social Subsidized Housing.
Furthermore, the loan cannot exceed 25 years and the rate cannot exceed more than 50% of the monthly household income.
