After suffering a blow in 2020, the mortgage market recovered to pre-pandemic levels last year, and was dominated by younger people looking to buy their first property.
In 2021, four in ten mortgage loans granted by the bank BNP Paribas Fortis were for people under 35. People in their twenties even accounted for a quarter of the market, while the number of loans sold to the baby boomer generation decreased.
"Environmentally conscious people under 30 were somewhat less present on the real estate market in 2020 because of the disappearance of the housing bonus at the end of 2019 and the start of the pandemic in 2020. But that is a thing of the past," a statement read.
The number of mortgage loans taken out by young people increased by 33% increase compared to 2020, however, this number is largely the same as in 2019. More remarkable is the 20% drop in the number of applications from over-55s. They represented just 7% of the home loans granted by BNP Paribas Fortis in 2021.
Millennials continue to borrow the largest amount (€209,000) and pay it off for a longer time (272 months), both higher than the average (€187,000 in 226 months).
Last year, €41.5 billion in mortgage loans was approved (up by one-fourth compared to 2020), while 415,500 estimated transactions were completed (up by 14% compared to 2020), figures nearing the record levels seen in 2019.
Reducing ecological footprint
The bank found that the ecological footprint of the housing sector is becoming increasingly important to buyers. In Belgium, the housing sector is responsible for 13.8% of CO2 emissions, while only 5% of buildings meet the 2050 energy targets. To reach these targets, an estimated €285 billion in investments would be needed.
"The credit sector plays a central role in the transition to more energy-efficient construction and renovation," said Elisabeth Minjauw, responsible for Sustainable Credits at BNP Paribas Fortis.
The bank is the only one of all major banks in the country to link the interest rate to the sustainability of the property, while it offers a range of incentives for projects, including a tariff reduction linked to the sustainability or the granting of a higher quota.
"We must encourage the granting of green loans in order to build low-energy houses or renovate existing houses in an energy-efficient manner. This is good for the planet and good for consumers," Minjauw added.
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The bank's predictions for 2022 are a rise in interest rates and in property prices, however, the latter is expected to rise more slowly than in 2021."We expect an increase of 4 to 5% for 2022," Tim Spellemans, head of mortgage loans at BNP Paribas Fortis, said.
However, inflation is expected to peak in the first quarter of this year, which will push up commodity prices. "What impact will that have on renovation and construction projects? The combination of increasing demands on energy performance and the general price rise could put a brake on many customers' plans," Spellemans said.
