The “My Home” program is relaunched with changes in terms of age and income criteria as well as in terms of the value of the property.
Through the program, a total of 2 billion euros will be channeled into the housing market, provided of course that the corresponding properties that meet the relevant specifications are found.
The government’s goal is for 20,000 beneficiaries to join the program, however, it is not such an easy goal as the final securing of a loan with a subsidized interest rate is a difficult equation both due to the income criteria and due to the narrowness of the housing market especially in large cities centers, Athens and Thessaloniki.
The characteristics of the loan
The loans that the beneficiaries can take is up to 190,000 euros and covers up to 90% of the property’s value.
In addition, there are the following cut-off criteria: The residence must be built before 2007, while its commercial value can reach 250,000 euros and the maximum area must not exceed 150 sq.m.
Also, borrowers should not own another home that meets their housing needs. As far as the age limit is concerned, the program can now also be joined by people in their fifties (age limit 25-50 years).
If a beneficiary has found a residence of 230,000 euros, he cannot get a loan of 90% of the value of the property as there is a cutter of the total loan of 190,000 euros.
So the specific beneficiary, if he meets the income limits for the bank, will get a loan of 190,000 euros, while the remaining 40,000 euros should be the beneficiary’s own participation.
For a residence again of 150,000 euros respectively, the beneficiary will be able to get a loan of 135,000 euros, the same participation is limited to 15,000 euros.
In the previous cycle of the program, the pre-approval of the loan was valid for two months, while in the new cycle the pre-approval will last until the exhaustion of the available resources.
The maximum duration of the loan can be 30 years.
Interest 50% of the loan
The loan through the program is financed by 50% from the resources of the Recovery Fund, so we are talking about an interest-free loan, while the remaining 50% will come from the banks. The terms from the banks have yet to be locked in. In the previous cycle, the bank loan was at a three-month Euribor rate +1%.
Thus, for a residence of 200,000 euros, the beneficiary will borrow (provided he always meets the criteria), 180,000 euros (90% of the value is covered) with the following distribution: The 90,000 euros will come from funds of the Recovery Fund and the 90,000 euros will they are a bank loan, while for the purchase the beneficiary must have an own participation of 20,000 euros.
Accordingly, for a residence within the mentioned specifications, which costs 150,000 euros, the borrower will receive a total loan of 135,000 euros which will be divided as follows: 67,500 euros will be an interest-free loan and the remaining 67,500 euros will come through bank borrowing and it is understood how he must have equity of 15,000 euros.
In any case, the beneficiaries will have to participate with their own funds (a fact that makes the program more difficult
The installment of the loan
To be able to understand the difference of the loan installment through the program in relation to a normal bank loan, we will use as an example the purchase of a house of 200,000 euros, which means a loan of 180,000 euros.
Based on the assumption that the duration of the loan is the maximum, i.e. 30 years, the beneficiary will pay a monthly installment for the part of the interest-free loan of 250 euros, while for the bank loan (as long as the terms are the same, i.e. quarterly Euribor +1% with the previous cycle of the program), 462.5 euros so a total installment of 712 euros.
If the loan were entirely through a bank (floating interest rate), the specific beneficiary would pay a monthly installment of approximately 1,064 euros. So through the program the beneficiary will pay a smaller installment of almost 300 euros. For a smaller loan of 135,000 euros (duration 30 years), if the beneficiary received it entirely through the bank he would pay a monthly installment of 793 euros, through the program the total installment would be approximately 534 euros.
The available properties in Attica
According to data from the Panhellenic E-Real Estates Network, the availability of properties from 85sqm to 150sqm above the 1st floor, with year of construction up to 2007 and asking price up to €200,000, reaches 36.36% in the areas of the center of Athens, 35.13% in the Western Suburbs and 20.53% in the areas of Piraeus. Little and/or zero availability is recorded in the areas of the Northern, Southern and Eastern Suburbs.
Significantly higher availability is recorded in properties worth up to €250,000. Specifically in the areas of the center of Athens, the availability rate reaches 62.90%, in the Western Suburbs 80.05%, in the areas of Piraeus 43.25% and in the East Suburbs 40.18%. In the Northern and Southern Suburbs the availability is 18.02% and 23.52% respectively.
Source: ot.gr
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