Home News Mortgage market mayhem: Public owes banks NIS 505 billion

Mortgage market mayhem: Public owes banks NIS 505 billion

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The mortgage market continues to bubble, with NIS 11.9 billion worth of mortgages taken out in June despite rising interest rates, according to Bank of Israel data released on July 25. This is an increase of 2.5% compared to June 2021 and a slight decrease of 0.8% compared to May 2021.

Mortgage records were set for loans worth NIS 13.4 billion this March. Interest rates were raised several times in the second quarter, reaching 1.25%.up to date interest rate rise 0.5% increase in monthly mortgage payments of 300-400 NIS.many Mortgage soars It was tied to a prime rate that automatically increased as interest rates rose.

The move was led by Professor Amir Yaron, Governor of the Bank of Israel. Analysts say Yaron plans to raise interest rates by 0.5% in an upcoming decision to be announced on August 23.

Nonetheless, rising interest rates have not been reflected in a decline in the number of loans, but people buying apartments as an investment have reduced their share of buying apartments, which is currently 11% of transaction volume. House prices rose more than 16% last year, according to the released index.

The following numbers prove the importance of hot markets. Currently, the average mortgage amount is NIS 988,000. NIS 69 billion in the first half of 2022, NIS 145 billion in the last 12 months and NIS 78 billion in 2020.

Professor Amir Yaron, Governor of the Bank of Israel, at the Jerusalem Post’s London meeting on March 31, 2022. Yaron (Credit: MARC ISRAEL SELLEM)

Mortgages worth Trillion Shekels

According to the data, the debt of mortgage Banking system users exceeded NIS 5 trillion for the first time. About 1,000,000 households own homes and pay monthly mortgages.

Another number just released is that the leverage range (mortgage amount to transaction amount) continues to rise. His 46% leverage on last month’s mortgage recipients was between 60% and 70%. The construction company and residential developer are expected to release their financial statements for the first half of 2022 in the coming weeks.

The data shows that construction companies such as Azorim, Africa Residences, Shikun and Binui Real Estate, Ashstrom, Dimari, Parshkovski, Bonei Hatichon, and Mor increased sales of new apartments and public purchases through increased credit granted by various companies. indicates that it has raised funds for Bank.

Former chairman of the Structural Reform Research Institute. In his July 25 release of Bank of Israel data, Shraga Biran said there were still hundreds of thousands of households who could not afford to buy an apartment even before interest rates rose, but no one could afford to buy them. We didn’t count and no one cares. Step up and take action to solve the housing crisis.

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