Hungarian banks cut mortgage rates as competition over Otthon Start loans intensifies

CIB Bank reduced the interest rates on several of its mortgage products from August 1, bringing the annual rates for its Fixed Housing Loan to between 6.75% and 6.95% and its Qualified Consumer‑Friendly Housing Loan to 6.64%‑6.74%. The cuts target higher‑income borrowers, while rates for average earners remained unchanged.

From August 10, UniCredit Bank entered the market of sub‑3% Otthon Start loans, offering a fixed 2.89% annual rate and lowering its total loan cost indicator to 3.0%. This places UniCredit alongside MagNet (2.80%), MBH (2.89%) and CIB Bank (2.95%) as banks competing for borrowers seeking the government‑backed Otthon Start mortgage, which is projected to account for about 80% of new housing loans in 2026. Conversely, Gránit Bank stopped offering sub‑3% rates for Otthon Start and CSOK Plus loans, raising its rate to 3%.

The Hungarian mortgage market has seen record borrowing, with June 2024 recording 282 billion HUF in new housing loans and 156 billion HUF in personal loans, a 96.3% year‑on‑year increase driven largely by the Otthon Start program.