European Mortgage

According to the European Mortgage Federation’s statistical publication on
European Mortgage markets, Hypostat 2003 has revealed a strong growth in Europe’s mortgage markets. Though the GDP growth in European union area was of just 0.4% in the 2003 still the mortgage markets grew by 7.4%. At end 2003 the total value of residential mortgage debt outstanding in the EU15 was €4.24 trillion, equivalent to €11,200 worth of housing debt per capita.
Recent Stance Of European Mortgage Market
The following points highlight the recent trends of European Mortgage market.
The average rate of home ownership in the EU15 member countries is 64%.The lowest rate is in Germany (41%) and the highest rates in Spain and Greece(83%).
The average rate of growth of the residential mortgage market over the last 5 Years is 9% and 8% over the last 10 years.
The total value of residential and non-residential mortgage loans at the end of 2003 was approximately €5.1 trillion.
Germany and UK, the front line Players in European Mortgage Market
The top players in the mortgage market of Europe represent over half of all Europe’s outstanding mortgage debt had to face slower rates of growth at 1.2% and 4.4% respectively, compared to an EU average rate of growth of over 7%. Poorer macro-economic position in Germany has marked repercussions on its Housing and mortgage markets.The UK market has slowed down following a number of years of very rapid growth.
Over all picture of European Mortgage Market
Countries like German and UK with other European markets have faced a slower rate of growth in comparison to the southern countries where the housing debt is very less.
The Mortgage market in the countries like Latvia, Poland, Czech Republic and Hungary have experienced a phenomenal growth averaging in excess of 50% per annuam. Some old EU members have also faced strong growth due to rising home prices.
Countries like Greece, Spain, Italy, and Ireland have faced a mortgage market growth of
Around 25% during 2003.
Rising House Prices In European Market
There is an overall increase in the housing prices in EU areas in recent years by supporting to the consumption activity in the country. The strongest prices increase was felt in the countries likeLatvia, Portugal, Spain and the UK. However the higher house prices have fueled the demand of more mortgages.
The European Mortgage Federation
It is a European trade association, which plays a significant role in the credit sector.
It groups together financial institutions consisting of granting mortgage loans in the Member States of the European Union and Norway. This Federation was founded in 1967 and based in Brussels. The Federation has brought together private and public mortgage lenders, including universal/commercial banks, mortgage banks, savings banks, mutual &
co-operative banks, building societies, umbrella companies and insurance companies. Together they grant around 75% of residential and commercial mortgage loans in Europe.
The below graphs give a true picture of the Mortgage market of EU nations.Overview of European Residential Mortgage Markets, 2003

Sources : EMF, Mortgage Bankers of America, EUROSTAT, Federal Reserve