Expert advices young homebuyers to hurry to the bank

FinanstilsynetOslo. Finanstilsynet.Photo: Vidar Ruud / NTB scanpix

Young homebuyers are amongst those who will be hardest hit if  stricter lending rules are introduced . Secure your financing before it is too late, is the advice from socio- economist Mari Mamre.

– Young first time buyers are already vulnerable  when inflation is so powerful. They will fall even more behind now, with both higher income requirements and less leaway for judgment by the banks, says economist and housing analyst Mari Mamre to Dagens Næringsliv.

FSA proposes that the new and stricter mortgage rules will take effect from January. That means there will be a rush to get on the housing ladder, says Mamre.
– Hurry up and obtain financing, at least if you are going to buy housing in a pressurised area, says Mamre.

Teachers and nurses

FSA wants to curb house price and credit growth through new proposals that were submitted to the Ministry of Finance on Thursday. The audit will include depriving the banks of their ability to exercise judgment in the requirement of 15 per cent equity for up to 10 percent of approved house morgages.

In addition, we propose that the bank customers’ total loans burden should not exceed more than five times their gross annual income.

– The introduction of such rigid regulations  will affect all those who are temporarily on low incomes, where banks today can exercise discretion. It will also affect teachers and nurses and others with low median wages, says Mamre.


Source: NTB scanpix / Norway Today