Albania's Central Bank Tightens Mortgage Lending Rules

The Bank of Albania has introduced stricter measures for mortgage lending. These measures aim to reduce risk in the housing loan market. The goal is to ensure banks follow consistent standards. The regulator's supervisory council has limited loan-to-value and loan installment-to-income ratios. These apply to residential real estate loans. The central bank aims to reduce bank losses if property prices fall. For loans in Albanian lek, borrowers can access up to 85% of a property's value for a first home. For foreign currency loans, the limit is 75%. Loan installments must not exceed 40% of the borrower's monthly income for the first home.