The mortgage market's recovery this spring continued in May, when 65 million euros of housing loans were taken out by households - the largest monthly figure since 2008 and a 23 percent increase in turnover since a year ago.
Although demand for loans and activity in the real estate market have both increased, lending is more conservative than in the pre-crisis years, according to a statement published today by the Bank of Estonia.
Loans have recently had a smaller role in housing purchases and in financing construction than in the previous growth cycle, the statement said.
Growth in the housing loan stock has been very modest, as new loans exceed repayments by only a small margin. The annual growth rate for the housing loan portfolio at the end of May was 0.1 percent.
The average interest rate on housing loans fell to 2.4 percent. Extremely low base rates have favored borrowers.