Showing posts with label Global Housing Watch. Show all posts
Monday, July 20, 2015
LTV and DTI Limits—Going Granular
A new IMF paper by Luis I. Jácome and Srobona Mitra looks at how loan-to-value (LTV) and debt-service-to-income (DTI) limits work in practice (Brazil, Hong Kong SAR, Korea, Malaysia, Poland, and Romania). The authors find that “(…) rapid growth in high-LTV loans with long maturities or in the number of borrowers with multiple mortgages can be signs of build up in systemic risk; monitoring nonperforming loans by loan characteristics can help in calibrating changes in the LTV and DTI limits; Read the full article…
Posted by at 6:26 PM
Labels: Global Housing Watch
Housing Market in Lebanon
“Risks could arise following a sharper downturn of the real estate market. A sizable fraction of bank loans to the private sector have been directed at the real estate sector, where activity is softening. But, in the absence of a price index, the number and value of property sales can serve as a proxy for the housing cycle. Both indicators grew by close to 3 percent in 2014. This is slightly more than the 2009–14 average for the number of transactions, Read the full article…
Posted by at 6:09 PM
Labels: Global Housing Watch
Wednesday, July 15, 2015
House Prices in Germany
“The moderate upward trend in housing prices continues and the appropriate response at this stage is close monitoring and readying the macroprudential toolkit. After years of stagnation, nominal housing prices at the aggregate level have grown at an annual pace of 3–4 percent for the past five years—only marginally faster than the growth in disposable income. In spite of falling lending rates, mortgage loan growth remains modest and lending standards appear stable. Thus, there are no signs of overheating yet. Read the full article…
Posted by at 6:52 PM
Labels: Global Housing Watch
Tuesday, July 14, 2015
Housing Market in Poland
On foreign-currency mortgages, the new IMF report on Poland says that “While tighter prudential regulation has halted new FX lending, a substantial legacy stock of these loans remains. Close to half of mortgages are denominated in FX (mostly Swiss franc), exposing households and banks to sudden zloty depreciation—as was the case in January when the zloty depreciated around 20 percent against the Swiss franc. As such, the January episode had little macroeconomic impact and high capital buffers in banks mitigated financial stability risks. Read the full article…
Posted by at 6:52 PM
Labels: Global Housing Watch
Friday, July 10, 2015
Housing Market in France
Moreover, the report says that “More could be done to alleviate structural rigidities in the housing market. Residential construction has fallen by 14 percent, and real house prices by 11 percent, since the peak in 2007. While this decline is partly cyclical, a succession of laws introducing regulatory and tax changes may also have contributed. Another long-standing factor affecting the market is the extensive system of housing subsidies, which include rental cash assistance (received by 44 percent of tenants), subsidized mortgage rates for households, and fiscal breaks for providers (including of social housing), together amounting to 1.9 percent of GDP in 2013. While these were aimed at making housing more affordable, studies have found that rental assistance may contribute to rising rents. Staff recommended reviewing the functioning of the housing market, with a view to alleviating constraints on the supply of affordable housing and improving the targeting of benefits.”
A separate IMF note on the Financial Sector, Housing Prices and Private Balance Sheets notes the following: “House prices have continued to decline gently since their peak in 2011, but affordability metrics remain above long-run averages. House price overvaluation is currently estimated at around 10–15 percent. Nevertheless, household debt appears manageable, at around 10–15 percent.
On the housing market, “they [the French government] do not see risks to financial stability at this point, given prudent lending practices based on repayment ability, the predominance of fixed-rate mortgages, and the mortgage insurance scheme”, according to the new IMF report on France.
Moreover, the report says that “More could be done to alleviate structural rigidities in the housing market. Residential construction has fallen by 14 percent, and real house prices by 11 percent,
Posted by at 6:11 PM
Labels: Global Housing Watch
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