The Unassuming Economist

“Real estate remains dynamic. Real mortgage credit expanded by 9 percent (y/y) in April, and house prices, following some deceleration, are rising again though with large regional variation,” says the IMF’s annual economic report on Chile. 

Moreover, in terms of real estate exposure, the report says that “Mortgage loans represent about one-quarter of banks’ loan portfolio and the share of mortgages with elevated (80 percent or higher) loan-to-value (LTV) ratios has stabilized at a relatively high 60 percent. Prompt implementation of regulation underway linking mortgage credit provisioning to LTV levels would be important, and further action (hard limits on LTVs and debt-to-income ratios) might need to be considered. The mission also encouraged the authorities to address real estate data gaps, in particular for commercial real estate.”