“First Home” Program Should Favor New-Built Dwellings – Romanian Deputy PM

Nica also spoke Tuesday about the necessity to build more social homes for young people with very low incomes.

He said this program creates a multiplier effect because it would be similar with giving funds to the local construction sector, thus fueling new jobs, a lower unemployment rate and more stable incomes.

Nica admitted that he cannot exclude the possibility that the dwellings purchased through the “First Home” program might be part of the already-existing locative fund, if old dwellings are cheaper.

According to him, the Government’s discussions with local banks were completed, and the lenders had a positive attitude as regards their offer and interest rates in this program.

In his opinion, the interest rates are still high for a young couple, and the condition of having a monthly income of around EUR1,000 is restrictive, so that he pleaded for a more flexible approach of the bank loans.

Last week, Prime Minister Emil Boc said Romanian citizens that do not own a home and have never taken a mortgage loan will benefit, as of June 20, from state guarantee for a loan to acquire their first dwelling, regardless of the applicant’s age.

According to him, the methodological norms for the "First Home" program will be completed in a maximum 15-day period.

The Romanian Government announced mid-May a program to guarantee the loans contracted for the purchase of the first home, within the maximum limit of EUR60,000, with the entire financing granted to this program reaching EUR1 billion.

The guarantee will be granted to people buying their first home and who did not previously benefit from a mortgage loan.