According to the ECB, demand for mortgages among the population is growing for the first time since 2022
Demand for home loans by eurozone households recovered in the second quarter, representing a first data increase since Q1 2022This is stated in a study of bank lending by the European Central Bank (ECB).
Rebound, The 16% recorded in the second quarter followed a slight decline seen in the previous quarter.up to 3%, but turned out to be weaker than banks expected (22%).
It is one of the four largest economies in the eurozone.German, Spanish and Italian banks recorded net growthwhile French banks reported flat demand for mortgages.
“The better outlook for the real estate market was the main factor that increased demand for housing loans“,” the ECB explains, highlighting the development in Germany, where the “relatively strong” fall in prices recorded has led to an increase in housing affordability.
Looking ahead to the third quarter of 2024, eurozone banks expect a “strong increase in demand for mortgages”.
Similarly, if we look at the third quarter of 2024, Eurozone banks expect ‘strong increase in demand’ housing loans”, up to 26%.
For their part, banks reported an increase in demand for consumer loans (13%) with greater intensity of expectations of subjects (6%), while in Spain, Germany and France the growth in demand remained unchanged in Italy. Looking to the third quarter, Banks also expect a net increase in demand for consumer loans (7%)..
However, for companies, net credit demand from companies fell again in the second quarter of 2024, with a 7% drop, although the decline was significantly smaller than in the previous quarter and was significant among the four largest euro area countries, as banks France and Italy report new decline in demand and Germany and Spain reported increases.
The fall in demand for loans from euro area companies was mainly due to the effect of high interest rates and weak fixed investment, while for the first time in six quarters there was a small positive contribution from inventories and working capital.
Eurozone banks reported a small additional net tightening (3%)
Looking ahead to the third quarter, banks expect a net increase in corporate loan demand (10%). If this materializes, This will be the first increase since the third quarter of 2022.
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 they returned to formulating their criteria for providing housing loans to households became 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.