Serbian household borrowing expanded rapidly in the first quarter of 2026, with total household credit growing by more than 20% year on year and becoming the fastest-growing major segment of bank lending. The increase was supported by rising real wages, lower inflation and strong liquidity in the banking sector.
Banks’ claims on households reached RSD2.02 trillion at the end of the first quarter of 2026, compared with RSD1.94 trillion at the end of 2025 and RSD1.62 trillion at the end of 2024. Measured in euros, the household loan portfolio stood at approximately €16.55 billion.
The average outstanding credit per inhabitant increased to RSD305,600, equivalent to around €2,602. The average loan balance per borrower rose to RSD1.16 million, or approximately €9,873, compared with €7,946 in 2024. The average value of newly approved loans also increased, reaching RSD788,800, or around €6,717, indicating that borrowers are taking on larger individual obligations.
Wage Growth Supports Household Borrowing Expansion
Household repayment capacity improved as real wage growth strengthened during the period. Lower inflation allowed nominal salary increases to translate into higher purchasing power, supporting consumer activity and demand for housing, consumer and cash loans.
Foreign-currency exposure within household lending has declined over the longer term. Foreign-currency and foreign-currency-indexed loans accounted for 43.5% of household credit, down slightly from 43.8% at the end of 2025 and significantly below the 72.4% recorded in 2010. Despite the reduction, foreign-currency exposure remains significant, particularly in the housing segment. Most mortgage loans continue to be indexed to the euro, leaving borrowers exposed to movements in euro interest rates and the dinar-euro exchange rate.
Households maintain a substantial foreign-currency deposit position. Foreign-currency deposits represented 66.2% of total household deposits and amounted to 210.5% of foreign-currency household loans. The household sector as a whole remains a net euro saver, although the distribution of deposits and loans differs between individual households, meaning deposit holdings do not necessarily belong to mortgage borrowers.
Housing Loans and Property Prices Show Continued Growth
Housing-market leverage has gradually increased as credit expansion continued. The average loan-to-value ratio for housing loans reached 64.8%, compared with 63.8% in 2025, 62.6% in 2024 and 57.9% in 2022. An average LTV below 65% continues to provide a significant collateral buffer. The upward trend indicates that buyers are increasingly relying on debt financing and contributing less equity when purchasing properties.
Apartment prices continued to increase across all regions of Serbia. The national apartment-price index approached 190, based on a reference value of 100 in the first quarter of 2019. In Belgrade, the index exceeded 200, indicating that nominal apartment prices have approximately doubled since the beginning of the measurement period.
Credit and Real Estate Dynamics Require Monitoring
The combination of rising property prices and expanding household credit represents the main area requiring attention. Higher property valuations enable larger loans, while easier credit conditions can contribute to further price increases. This dynamic can remain stable while wages continue to rise, employment conditions remain favourable and borrowing costs decline. However, pressure can increase if housing affordability weakens.
Short-term loans accounted for only 1.7% of total household lending, reducing immediate refinancing pressure. Longer loan maturities help lower monthly repayment obligations but extend banks’ exposure to borrower income trends, interest-rate movements and property-value cycles.
Serbia’s household sector has not reached the levels of high loan-to-value borrowing or widespread repayment problems typically associated with systemic mortgage stress. Nevertheless, the combination of rapid household credit growth, rising average debt levels and continued apartment-price increases requires closer macroprudential monitoring before potential deterioration appears in asset-quality indicators.
