HYPOSTAT 2020 HYPOSTAT 2020 | A REVIEW OF EUROPE’S MORTGAGE AND HOUSING MARKETS European Mortgage Federation November 2020 DISCLAIMER The entire content of this publication is protected by copyright. All rights offer to purchase or subscribe for securities or financial instruments or reserved. No part of this publication may be reproduced, stored in a retrieval any advice or recommendation with respect to such securities or other system, or transmitted in any other form or by any means: electronic, me- financial instruments. chanical, photocopying, recording or otherwise, without the prior permission Neither the European Mortgage Federation nor the authors contributing to of the European Mortgage Federation – European Covered Bond Council. Hypostat shall accept any liability whatsoever (whether in negligence, tort Hypostat 2020 and the information, statements and opinions contained or otherwise) arising in any way in relation to the statements contained in the document are intended for information purposes only and do not herein or in relation to any loss arising from their use or otherwise arising replace independent professional judgment. in connection with this document. Hypostat 2020 and the information, statements and opinions contained Nothing in this document shall be construe as investment, legal, tax or in the document do not constitute any solicitation or a public offer other professional advice by the European Mortgage Federation or the under any applicable legislation or an offer to sell or solicitation of an authors contributing to Hypostat. CONTACT DETAILS EDITORS Luca Bertalot Jennifer Johnson Daniele Westig Sofia Garrido Pérez Richard Kemmish Secretary General Deputy Secretary General Economic Adviser Policy Adviser External Consultant [email protected] [email protected] [email protected] [email protected] [email protected] Tel: +32 2 285 40 35 Tel: +32 2 285 40 45 Tel: +32 2 285 40 40 Tel: +32 2 285 40 42 LIST OF AUSTRIA FRANCE NETHERLANDS Lúðvík Elíasson Wolfgang Amann Patrick Stocker Nico de Vries Central Bank of Iceland CONTRIBUTORS Institut für Immobilien, Crédit Agricole ING Bank [email protected] TO DATA Bauen und Wohnen Gmbh [email protected] [email protected] [email protected] NORWAY AND ANALYSIS GERMANY Paul de Vries Michael H. Cook Karin Wagner Thomas Hofer Dutch Land Registry Finance Norway Oesterreichische Nationalbank Verband deutscher Pfandbriefbanken [email protected] [email protected] [email protected] – vdp POLAND [email protected] UNITED KINGDOM BELGIUM Agnieszka Nierodka Joseph Thompson Zoë Delhaye GREECE Polish Bank Association Building Societies Association Union Professionnelle du Crédit Calliope Akantziliotou [email protected] [email protected] (Febelfin) Bank of Greece PORTUGAL [email protected] [email protected] BRAZIL Bráulio Silva Filipe F. Pontual BULGARIA HUNGARY Caixa Económica Montepio Geral Brazilian Association of Real Estate Petar Ivanov Gyula Nagy [email protected] Loans and Savings Companies -ABECIP Tsvetkova Bebov Komarevski – TBK Takarék Mortgage Bank Plc Magda Ventura [email protected] [email protected] [email protected] Caixa Económica Montepio Geral Kristina Dimitrova [email protected] CANADA Tsvetkova Bebov Komarevski – TBK IRELAND Lily Shum [email protected] Anthony O’Brien ROMANIA Canada Mortgage and Housing Banking & Payments Federation Ştefan Dina Corporation CROATIA Ireland Romanian Association of Banks [email protected] Edin Karakaš [email protected] [email protected] Žurić i Partneri, law firm, OD d.o.o. JAPAN [email protected] ITALY SLOVAKIA Shoichiro Konishi Marco Marino Matej Bašták Japan Housing Finance Agency – JHF CYPRUS Italian Banking Association – ABI Slovenská sporiteľňa [email protected] Ioannis Tirkides [email protected] [email protected] Bank of Cyprus RUSSIA [email protected] LATVIA SLOVENIA Andrey Tumanov Jekaterina Petkevica Daniele Westig DOM.RF Russia Housing and CZECHIA Bank of Latvia European Mortgage Federation – Urban Development Corporation Martin Kotek [email protected] European Covered Bond Council [email protected] Komerční banka, a. s. [email protected] [email protected] LITHUANIA SINGAPORE Jonas Grincius SPAIN Colin YS Chen DENMARK AB Citadele Bankas Leyre Lopez DBS Bank Ltd Sandie Wrona [email protected] Spanish Mortgage Association – AHE [email protected] Finance Denmark [email protected] [email protected] LUXEMBOURG TURKEY Benoît Cerfontaine SWEDEN Yener Coşkun ESTONIA The Luxembourg Bankers’ Association Christian Nilsson Capital Markets Board of Turkey Kaire Husu [email protected] Swedish Bankers’ Association [email protected] Luminor Group [email protected] [email protected] MALTA Karol Gabarretta ICELAND FINLAND Malta Bankers’ Association Magnus Arni Skulason Mariia Somerla [email protected] Reykjavik Economics ehf Finance Finland [email protected] [email protected] CONTRIBUTORS Christine Whitehead Danae Kyriakopoulou Luiz De Mello Luca Bertalot London School of Economics Official Monetary and Financial Organisation for Economic European Mortgage Federation – TO HYPOSTAT [email protected] Institutions Forum – OMFIF Co-operation European Covered Bond Council ARTICLES [email protected] and Development – OECD [email protected] Max Riedel [email protected] Ca’ Foscari University of Venice [email protected] NOTE: The views and positions expressed in this publication are of the authors alone, and should not be interpreted as necessarily being those of the institutions to which they are affiliated. CONTENTS FOREWORD 5 STATISTICAL TABLES 137 KEY FACTS A — THE MORTGAGE MARKET 9 1. Total Outstanding Residential Loans 137 THE COVID-19 PANDEMIC 2. Change in Outstanding Residential Loans 138 AND REAL ESTATE: EFFECTS 11 3. Gross Residential Loans 139 AND POLICY CHALLENGES 4. Representative Interest Rates on New Residential Loans 140 ARE EUROPEAN MORTGAGE MARKETS CONVERGING? 17 5. Amount of gross lending with a variable interest rate 141 FINANCING AFFORDABLE HOME 6. Average amount of a Mortgage granted 142 OWNERSHIP IN EUROPE 21 7. Total Outstanding Non-Residential Mortgage Loans 143 ENERGY EFFICIENT MORTGAGES 8. Total Outstanding Residential Loans to GDP Ratio 144 INITIATIVE: FIRM STEPS 9. Total Outstanding Residential Loans to TOWARDS MAKING EEM A REALITY 24 Disposable Income of Households Ratio 145 IN THE MARKET 10. Total Outstanding Residential Loans per Capita 146 HOUSING AND MORTGAGE MARKETS B — THE HOUSING MARKET IN 2019 29 11. Owner Occupation Rate 147 EU 27 COUNTRY REPORTS 12. Building Permits 148 49 13. Housing Starts Austria 49 149 14. Housing Completions Belgium 52 150 Bulgaria 55 15. Real Gross Fixed Investment in Housing 151 Croatia 58 16. Total Dwelling Stock 152 Cyprus 61 17. Number of Transactions 153 Czechia 64 18. Nominal House Prices Indices 154 Denmark 66 19. Nominal House Price Index – cities 155 Estonia 69 20. Change in Nominal House Prices 158 Finland 72 21. Nominal House Price to Disposable Income France 74 of Households Ratio 159 Germany 77 Greece 80 C — FUNDING OF THE MORTGAGE Hungary 83 MARKET Ireland 86 22. Total Covered Bonds Outstanding 160 Italy 89 23. Total Covered Bonds Issuances 161 Latvia 92 24. Total Covered Bonds Outstanding 162 Lithuania 94 25. Total Residential Mortgage-Backed Securities Luxembourg 96 (RMBS) Outstanding 163 Malta 98 26. Total RMBS Issuances 163 The Netherlands 101 Poland 104 D — MACROECONOMIC INDICATORS Portugal 107 27. GDP at Current Market Prices Romania 164 111 28. Gross Disposable Income of Household Slovakia 165 114 29. Population Slovenia 117 166 30. Bilateral Nominal Exchange Rate with the Euro Spain 119 167 Sweden 122 ANNEX: EXPLANATORY NOTE OTHER EUROPEAN COUNTRY REPORTS 127 ON DATA 170 Iceland 127 Norway 130 United Kingdom 133 EMF HYPOSTAT 2020 3 4 EMF HYPOSTAT 2020 FOREWORD Between crisis and opportunities: building a better future for our next generation By Luca Bertalot, EMF-ECBC Secretary General As the COVID-19 pandemic has swept through Europe, it has filled us all with Those are the seeds identified to prepare the future for our upcoming generation. a deep awareness of and insight into the radical changes ahead of us. We all The Green Deal should be seen as an essential pillar of the Recovery Plan, going feel the winds of change blowing and we are preparing ourselves for a massive hand in hand with efforts to foster social mobility and the capacity of the most transformation of our society and with this also the economic and financial vulnerable part of the society to improve their future prospects. landscape. Never before in history have we seen a global pandemic which has simultaneously and dramatically impacted the supply and demand sides in all This cultural attitude is the fundamental of the welfare systems in Europe and the regions around the world, affecting the building blocks of our lives: how we mortgage systems in the Old Continent are an integral way of providing a social work, how we study, how we interact with people, how we live. Underestimating lift in the different countries. For example, looking at benchmarks, Denmark the depth and the intensity of this change would be a mistake. is not only the largest mortgage market and, with on average EUR 55,000 per adult, one of the most mortgage intense economies in Europe but it is also the This crisis is highlighting and accelerating key drivers of change and dynamics country where the young generation has the earliest access to housing and which some have tried to overlook or hide. Today more than ever we see that where a low-income Danish family can raise their wage and social status to the in our society every change has an impact on the rest of the globe and every country’s average in two generations, whereas in other regions in the globe it change in the rest of the globe has implications for our daily life: those who can take up to nine generations. Moreover, in terms of sustainability, Danish are hiding behind borders or walls must understand that no border or wall buildings now use half as much energy as they did 40 years ago.