The whole EU-27 mortgage market experienced a slight recovery as growth in values of outstanding mortgage lending over the previous year returned to positive figures. However, the crisis is still present and has a serious impact on EU mortgage and housing markets.
According to year-end 2009 data which the EMF published in its last “Quarterly Review” and other provisional national data on mortgage lending, the scenario for mortgage and housing markets reveals a mixed picture. At first glance, following from the recession experienced in 2008 (-1.4% according to revised 2008 data), the whole EU27 mortgage market experienced a slight recovery, as growth in values of outstanding mortgage lending over the previous year returned to positive territory (1.2%).
Nevertheless, in 2009 EU mortgage and housing markets continued to be impacted by the worst macroeconomic recession in the EU since World War II, which was triggered in the second half of 2008 by the sub-prime crisis in the US and the Lehman Brothers crash. While 2008 year-end values of outstanding residential lending which were reported in the EMF`s Hypostat 2008 did not yet fully reflect the effects of this overall downturn, 2009 mortgage and housing market conditions saw a further deterioration as a consequence of this macroeconomic and financial turmoil, especially in Q1 and Q2. However, some signs of a pick-up in activity were recorded in many markets in Q3 and Q4 2009.
As a result, on a year-to-year basis most markets still recorded positive increases in outstanding lending values in 2009. The only exceptions were the UK, where we find a negative year-to-year result, due solely to the exchange rate effect (once calculated in GBP values, it would have been slightly positive, 0.7%), Germany (which had experienced very stable developments in mortgage lending over the latest years) and Ireland, both recording negligible decreases.
To summarise, the latest update on housing and mortgage market conditions across the EU does not suggest that a general recovery has picked up everywhere in the EU, but at the same time most markets have returned to a more sustained activity from the bottom levels of the past quarters and this, barring any further fall-out from a Euro area sovereign debt crisis, allows a moderately more optimistic outlook for the forthcoming quarters of 2010.
The Monthly edition of the Mortgage Info also includes
· 2009 year-end figures: the downturn across EU mortgage and housing markets continues, but maybe it is getting near the end
· Consumer Rights – shaken and stirred
· ECBC | Covered Bonds – plain vanilla in big demand
· News in brief
· Agenda
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MORTGAGE INFO - June 2010.pdf
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