Wednesday, July 23, 2014

House Prices in the United States

"After a promising recovery in housing activity for most of 2013, the past several months have seen a retreat characterized by weaker housing starts, declining residential investment, and subdued home sales. New mortgage origination has been particularly sluggish as credit availability remains constrained for lower-rated borrowers and mortgage rates have moved up by around 70 basis points from a year ago," says the latest IMF's economic report on the United States.

More specifically, on mortgage availability, the report says that "A tighter regulatory regime for mortgage lending has helped better match the costs of such financing with the underlying risks. However, as a consequence, the recovery in the U.S. housing market has been held back by a continued conservative approach to mortgage lending, particularly to lower-rated borrowers. This has been driven by a range of factors that include persistent anxiety about potential "put-back" risks (...); litigation and reputational risks to lenders; a tighter regulatory environment and supervisory scrutiny; and uncertainty about the future structure of the mortgage industry."

Tuesday, July 22, 2014

House Prices in Chile

"Real estate remains dynamic. Real mortgage credit expanded by 9 percent (y/y) in April, and house prices, following some deceleration, are rising again though with large regional variation," says the IMF's annual economic report on Chile. 

Moreover, in terms of real estate exposure, the report says that "Mortgage loans represent about one-quarter of banks’ loan portfolio and the share of mortgages with elevated (80 percent or higher) loan-to-value (LTV) ratios has stabilized at a relatively high 60 percent. Prompt implementation of regulation underway linking mortgage credit provisioning to LTV levels would be important, and further action (hard limits on LTVs and debt-to-income ratios) might need to be considered. The mission also encouraged the authorities to address real estate data gaps, in particular for commercial real estate."

Monday, July 21, 2014

House Prices in Germany

"After several years of stagnation, German housing prices have been picking up, especially in large cities. They have increased by 18 percent in nominal terms since the trough of 2009:Q2 (Figure 1). Recent housing price inflation has been stronger in the largest cities, in particular Hamburg and Munich where the appreciation since early 2009 has been greater than 50 percent in the apartments segment. Simple valuation measures such as price-to-disposable-income-per-capita and price-to-rent ratios have remained almost flat, except in a few hot spots where an upward trend is evident (Steininger, 2014). Analysis by the Bundesbank suggests that housing prices in Germany as a whole are currently close to their fundamental value, but that apartment prices in large cities may be overvalued by about 25 percent (Bundesbank, 2014)," according to a new IMF report on Germany. 

Read the report's section on recent housing market developments here and macroprudential policies' section here

Thursday, July 10, 2014

House Prices in Iceland

House prices are starting to rise in Iceland, according to a new report by the IMF. 

House Prices in Spain

"House prices dropped by a third and the correction continues," says the latest IMF's economic report on Spain.