MORTGAGE LENDING MARKET IN EUROPE: DYNAMICS AND FEATURES
##plugins.themes.bootstrap3.article.main##
##plugins.themes.bootstrap3.article.sidebar##
Abstract
The housing market is an important part of any country's economy. The article analyses the main trends in the development of the mortgage lending market in Europe: general dynamics, development of individual segments, lending volumes, interest rates, construction volumes, resource prices, etc. The purpose of this article is to analyse current trends in the development of the housing market. Graphical and statistical analysis methods are used to visualise the trends in investment in residential construction in Europe in 2020-2022, to identify the main external and internal factors behind the market's decline, and to outline development prospects for the coming years. practical implications. Practical implications. The housing investment market is under the influence of new external destabilising factors (pandemic, military aggression), as well as the pressure of factors such as the economic crisis, widespread digitalisation, the fight against black markets, etc. The results of the analysis have identified the main factors currently affecting the European property market: the aftermath of the invasion of Ukraine, a sharp rise in energy prices, rising inflation and interest rates, a slowdown in economic activity and political uncertainty at global, regional and national level. In general, the development of the housing investment market is characterised by the following trends: high interest rates on mortgage loans; tightening of financing conditions and bank standards, reducing the availability of mortgage loans; slowdown in economic growth and rapid inflation; higher prices for energy and building materials, construction costs and, as a result, an increase in house prices; slowdown in bank lending to households buying houses. Value/originality. An urgent task of modern economic science and practice is the search for ways to attract additional financial resources, mechanisms to ease the financial burden of payments for investors, to reduce and distribute investment risks. It is these circumstances that have determined the growth of the housing investment market segment associated with such innovative forms of investment as digital lending and crowdfunding. According to forecasts, the global digital lending market will grow by up to 12% per year until 2026.
How to Cite
##plugins.themes.bootstrap3.article.details##
housing construction, mortgage lending, digitalization, digital lending, crowdfunding
Agrawal, A. K., Catalini, C., & Goldfarb, A. (2013). Some simple economics of crowdfunding. Working Paper 19133, National Bureau of Economic Research, Cambridge, 1–47. Available at: https://www.nber.org/papers/w19133
Ahlers, G., Cumming, D., Günther, Ch., & Schweizer, D. (2015). Signaling in Equity Crowdfunding. Entrepreneurship Theory and Practice, vol. 39 issue 4, July. Available at: https://journals.sagepub.com/doi/10.1111/etap.12157
Emerging Trends in Real Estate®: Europe 2023. This report is a joint survey by PwC and the Urban Land Institute. Now in its 20th edition, the survey provides an outlook on real estate throughout Europe for the near-term and 2023. Available at: ttps://www.pwc.com/gx/en/industries/financial-services/real-estate/emerging-trends-real-estate/europe-2023.html
Europe Construction Market Share, Size, Analysis, Trends: By End Use: Residential, Healthcare, Hospitality, Others; By Residential Buildings and Single Units: Apartments/Flats, Detached Houses, Semi-Detached, Terraced Houses, Others; Regional Analysis; Competitive Landscape; Key Trends and Developments in the Market; 2023-2028.
European Banking Authority (2022). “EBA Thematic Note – Residential Real Estate Exposures of EU Banks: Risks and Mitigants”, October; European Central Bank (2022), “Household inequality and financial stability risks: exploring the impact of changes in consumer prices and interest rates”, Financial Stab.
European Consumer Credit Market on a Recovery Path in 2021. Available at: https://eurofinas.org/european-consumer-credit-market-recovery-path-2021
European Housing at a Turning Point Risks, Household and Bank Vulnerabilities, and Policy Options.
European Mortgage Federation. José Díaz. Quarterly Review of European Mortgage Markets. Available at: https://hypo.org/app/uploads/sites/3/2022/07/EMF-Quarterly-Review-Q1-2022-FINAL.pdf
Evolution of the housing market. This chapter describes different aspects of the housing market: from purchase and price development to ownership and affordability. Available at: https://ec.europa.eu/eurostat/cache/digpub/european_economy/bloc-2c.html?lang=en.
Firek, A. M. (2017). Real Estate Crowdfunding – Tłum jako alternatywne źródło finansowania nieruchomości, Rynek – Społeczeństwo – Kultura, No 3(24). Available at: https://www.academia.edu/99311447/Real_Estate_Crowdfunding_T%C5%82um_jako_alternatywne_%C5%BAr%C3%B3d%C5%82o_finansowania_nieruchomo%C5%9
Gallego, A. F. A. (2011). Crowdfunding: decisiones de implementación en las industrias creativas de países emergentes. Kepes, Vol. 8, N 7 págs 159–169.
Gostkowska-Drzewicka, M. (2016). Crowdfunding jako źródło finansowania inwestycji wnieruchomości, Finanse, Rynki Finansowe. Ubezpieczenia, no 1 (79), 62–65.
Gross residential mortgage lending in selected European countries from 1st quarter 2019 to 3rd quarter 2022(in billion euros). Available at: https://www.statista.com/statistics/614850/gross-residential-mortgage-lending-europe/
House of cards? Perspectives on European housing 01 December 2022. Available at: https://www.allianz-trade.com/en_global/news-insights/economic-insights/eurozone-housing-market.html.
Housing Market Developments in the Euro Area: Focus on Housing Affordability Christine Frayne, Agnieszka Szczypińska, Bořek Vašíček and Stefan Zeugner DISCUSSION PAPER 171 | SEPTEMBER 2022. Available at: https://economy-finance.ec.europa.eu/system/files/2022-09/dp171_en.pdf
Housing prices fall by -8% in the Eurozone in 2023… But the value of housing in Belgium is not under pressure. Available at: https://www.allianz-trade.com/en_BE/news/latest-news/housing-prices-fall-in-the-Eurozone-2023.html.
How Many Banks Are in EU? Facts, Figures and List of the Largest Financial Institutions. Available at: https://internationalwealth.info/en/offshore-banks-en/how-many-banks-are-in-eu-facts-figures-and-list-of-the-largest-financial-institutions/#:~:text=As%20of%20July%202022%2C%20there,than%20two%20hundred%20clients%20each
Hypostat 2020: analysis of latest developments on european housing & mortgage market. Available at: https://hypo.org/emf/press-release/emf-hypostat-2020-analysis-of-latest-developments-on-european-housing-mortgage-market/
Lehner, O. M. (2013). Crowdfunding social ventures: A model and research agenda. Ventur. Cap., vol. 15, pp. 289–311. Available at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2102525
Mollick, E. (2014). The dynamics of crowdfunding: An exploratory study. Journal of business venturing, vol. 29, no. 1, pp. 1–16.
Mortgage interest rate in selected European countries as of 4th quarter of 2021 and 4th quarter 2022. Available at: https://www.statista.com/statistics/615037/mortgage-interest-rate-europe/
Mortgage lending statistics – March 2023. Available at: https://www.fca.org.uk/data/mortgage-lending-statistics
Osadchaya, N. A., Murzin, A. D., & Torgayan, E. E. (2017). Assessment of risks of investment and construction activities: Russian practice. Journal of Advanced Research in Law and Economics, vol. 8 no 2, pp. 529–544.
Property Index Overview of European Residential Markets 11th edition, August 2022. Available at: https://www2.deloitte.com/content/dam/Deloitte/at/Documents/presse/at-property-index-2022-final.pdf
Schweizer, D., & Zhou, T. (2016). Do Principles Pay in Real Estate Crowdfunding? Do Principles Pay in Real Estate Crowdfunding? Journal of Portfolio Management, vol. 43, no. 6. Available at: https://papers.ssrn.com/sol3/papers2.cfm?abstract_id=2846892
Schwienbacher, A., & Larralde, B. (2010). Crowdfunding of small entrepreneurial ventures. The Oxford Handbook of Entrepreneurial Finance / ed. D. J. Cumming. Oxford, Oxford University Press.
Sgaravatti, G., S. Tagliapietra, C. Trasi, & G. Zachmann (2023). National policies to shield consumers from rising energy prices. Bruegel Datasets, first published 4 November. Available at: https://www.bruegel.org/dataset/national-policies-shield-consu.
Sheina, S., Tsopa, N., & Kovalskaya, L. (2018). Assessment of the business potential impact on the controllability of an investment-construction project MATEC Web of Conferences 196 04041.
Statistical report n°65 (edition 2022. FIEC – European Construction Industry Federation. Available at: https://fiec-statistical-report.eu/european-union
Total outstanding residential mortgage lending in selected European countries as of 3rd quarter 2022. Available at: https://www.statista.com/statistics/614792/outstanding-residential-mortgage-lending-europe-by-country/
Valderrama (forthcoming), “Calibrating Macroprudential Policies in Europe – Considerations Amid Rising Housing Market Vulnerability”, IMF Working Paper 23/X.
Vogel, J. H., & Moll, B. S. (2014). Crowdfunding for real Estate. The Real Estate Finance Journal, Summer/Fall, p. 11. Available at: https://faculty.tuck.dartmouth.edu/images/uploads/faculty/john-vogel/crowdfunding_real_estate.pdf
This work is licensed under a Creative Commons Attribution 4.0 International License.