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New House Program: State may guarantee 60% of credit for purchase of new homes

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The 'First House' program, redefined this year as 'A Family, a Home', will become 'New Home', according to a draft order published by the Public Finance Ministry while credits of 100,000 euros for purchasing a new home, will be 60% guaranteed by the state.

For the purchase of another category of houses, for no more than 70,000 euros, the state guarantees 50% of the credit value, interest rates excluded. The minimum down payment of 5% of the house purchase price is maintained, representing the difference between the  purchase price of the house resulting from the sales-purchase contract and guaranteed financing. 

“Taking into account the fact that the First Home program was conceived as a support program for the active population, from the middle class, able to purchase a house in market conditions and access and support the payment of installments from bank loans, the functional re-systematization of the specific financing-guarantee mechanism.”the substantiation note shows.

 On the other hand, project initiators point out that the new values guaranteed by the state were established considering the overcrowding indicator and the quality of the house. According to the source, the average area of a house in EU-28 is over 100 sq.m while in Romania the average useful area of a house was 47.7 sq.m on December 31, 2019. At the same time, compared to the average housing area of 34 sq.m per person in Europe, Romania has a relatively low average per person (20 sq.m).

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