Demand for mortgages is growing again — Idealista/news
Demand for home loans from eurozone households rebounded in the second quarter, the first increase in data since the first quarter of 2022, according to the European Central Bank’s (ECB) bank lending survey.
The recovery recorded in the second quarter (16%) followed a slight decline seen in the previous quarter (-3%), but turned out to be weaker than banks expected (22%).
Among the four largest economies in the eurozone German, Spanish and Italian banks recorded net growthwhile French banks reported flat demand for mortgages.
” the best prospects in the real estate market “were the main factor that increased demand for loans to buy housing,” the ECB explains, highlighting the development in Germany, where the “relatively strong” fall in prices recorded improved housing affordability.
Besides, Looking to the third quarter of 2024, eurozone banks expect a “strong increase in demand for mortgages” (26%).
For their part, the banks reported growth in demand for consumer credit (13%) with greater intensity of business expectations (6%), with growth in Spain, Germany and France, while demand remained unchanged in Italy. Looking to the third quarter, banks also expect a net increase in demand for consumer loans (7%).
When companiesHowever, net credit demand from companies fell again in Q2 2024 (-7%), although the decline was significantly smaller than in the previous quarter, with significant growth among the four largest eurozone countries, as banks in France and Italy reported a further fall in demand, while Germany and Spain reported growth.
The fall in demand for loans from eurozone companies was mainly due to the effect of high interest rates and weak fixed investmentwhile for the first time in six quarters there was a small positive contribution from inventories and working capital. Looking ahead to the third quarter, banks expect a net increase in corporate loan demand (10%). If this happens, it will be the first increase since the third quarter of 2022.
Credit offer
On the other hand, the ECB survey shows that euro area banks reported a small additional net tightening (3%) of their credit criteria for providing loans or credit lines to companies in the second quarter of 2024, while made the criteria for providing loans to households for the purchase of housing more flexible (-6%)and restrictions on consumer lending increased (6%).
Looking to the third quarter of 2024, banks expect a modest net tightening of business lending and no change in lending standards for household lending.