Hypostat 2015

More documents

Recommendations

Info

EU 28 Country Reports Sweden By Christian Nilsson, Swedish Bankers’ Association Macroeconomic Overview Sweden’s GDP grew by more than 1% in the fourth quarter of 2014, which was surprisingly high, according to the National Institute of Economic Research. Swedish exports grew strongly in the fourth quarter of 2014, partly due to a temporary surge in exports of services. The combination of the global recovery and a relatively weak krona mean that Swedish export growth is projected to rise from 3.3% in 2014 to around 5% in 2015 and 2016, according to the National Institute of Economic Research. Rising employment, higher real wages and reduced taxes have brought rapid growth in real household disposable income in recent years. The level of consumption is important for economic recovery in Sweden. Very low interest rates have stimulated household consumption, but precautionary motives and efforts to even out consumption over time have contributed to the saving rate hitting record-high levels. Employment remained unchanged and unemployment held at 7.9% by year end 2014. Meanwhile, the working-age population is projected to grow by around 1% per year, contributing to rapid expansion of the labour force. This means that the unemployment rate will only drop at a slow pace. Low inflation and low inflation expectations contributed to the Riksbank lowering the repo rate to -0.25% in March 2015. Thus, the Riksbank has been clear in both writing and actions that it is prepared to do more if necessary to meet the inflation target. The krona’s depreciation since summer 2015 will help push up inflation and inflation expectations if the krona remains at these low levels. Fiscal policy has been expansionary since the economic slump began in 2008. Government finances have gradually deteriorated, and structural net lending was -1.6% of potential GDP in 2014. Housing and Mortgage Markets Housing completion increased further in 2014 to around 31,500 dwellings compared to 29,225 dwellings in 2013. The figure is expected to increase further as housing starts and building permits have continued to increase during 2014. Housing starts have increased by 27% in 2014, equivalent to around 38,600 apartments. This is, with the exception of 2006, the highest figure since the beginning of the 1990’s. However, the demand for housing is high and the construction figures have been low for many years. Especially in the larger cities there is a lack of housing. Transactions continued to increase by almost 5% in 2014, with both one-family home and apartment transactions increasing. Prices on one-family homes increased by 7% in 2014 and the pace of price increases has surged during the year. The price increase for tenant-owned apartments surged even further and in 2014 apartments increased by around 13%. Compared to the larger cities in Sweden the price developments in the Malmöregion have been slower than those of Stockholm and Gothenburg. This is also due to the fact that the Malmö-region is influenced by the mortgage market in the Copenhagen region. Price increases in less populated areas in Sweden could also be quite different from the development in large- to middle city regions. Residential mortgages grew by 5.6% in local currency in 2014 (though there is a decrease when the figures are converted into Euro), which constitutes an increase compared to 2013 when outstanding residential mortgages grew by 4.9%. The growth rate of residential loans has been increasing since 2012 when residential mortgages increased by 4.5%. Prior to 2012, the growth rate had been slowing down for several years. Some of the factors which can explain the increased activity in residential lending are continued high demand for housing and the fact that the interest rate continued to fall in 2014. Also, the level of construction has not been high enough to meet population increase and urbanisation. Other factors have the opposite effect of cooling residential mortgage growth down. Above all, the two most important factors are the LTV-ceiling of 85% on new mortgage lending and banks’ increasing demand on borrowers to amortise. In addition, Finansinspektionen, the Swedish FSA, plans to impose amortisation rules in 2016. The variable (3-month) mortgage interest rate continued to decrease in 2014, from 2.4% in December 2013 to 1.7% in December 2014. The variable mortgage interest rate has also continued to decrease in 2015. Likewise, the initial fixed mortgage interest rates decreased in 2014, reaching record low levels during the year, and have continued to decrease in 2015. Finansinspektionen, the Swedish FSA, writes an annual report on the mortgage market. The report is an important part of the Finansinspektionen’s analysis of the mortgage market and the debt situation of Swedish households. In the most recent report, Finansinspektionen stated that the LTV-ceiling (85%) on new mortgage loans is still working well. The report also mentions that there are few new mortgage loans with an LTV above 85%. The average LTV for new mortgage loans was 67%in 2014, which is slightly lower than in 2013. Mortgage Funding Covered bonds are the most common form of funding used in the Swedish market for funding of mortgages. Despite the weak global financial markets during the financial crisis, Swedish credit institutions managed to issue covered bonds on the Swedish and global market. In 2014, the Swedish stock of covered bonds increased by 2.1% (in SEK) to EUR 210 billion (outstanding covered bonds decreased in EUR due to exchange rate effects). Sweden 2013 Sweden 2014 EU 28 2014 Real GDP growth (%) (1) 1.3 2.3 1.3 Unemployment Rate (LSF), annual average (%) (1) 8.0 7.9 10.2 HICP inflation (%) (1) 0.4 0.2 0.6 Outstanding Residential Loans (mn EUR) (2) 340,379 339,152 6,909,057 Outstanding Residential Loans per capita over 18 (EUR) (2) 44,624 44,089 16,787 Outstanding Residential Loans to disposable income ratio (%) (2) 149.0 151.0 n/a Gross residential lending, annual growth (%) (2) 14.5 10.0 n/a Typical interest rate on new residential loans, annual average (%) (2) 2.7 2.1 3.4* Owner occupation rate (%) (2) 69.6 n/a n/a Nominal house price growth (%) (1) 3.6 7.0 2.2 * Please note that this value is the simple average of the typical interest rate of the EU 28 countries. Sources: (1) Eurostat (2) European Mortgage Federation – Hypostat 2015, Statistical Tables. 80 | 2015 EMF HYPOSTAT
EU 28 Country Reports Sweden Fact Table Entities which can issue mortgage loans: The market share of the mortgage issuances: Proportion of outstanding mortgage loans of the mortgage issuances: Typical LTV ratio on residential mortgage loans: Any distinction made between residential and non‐residential loans: Most common mortgage product(s): Typical maturity of a mortgage: Most common way to fund mortgage lending: Level of costs associated with a house purchase: The level (if any) of government subsidies for house purchases: There are no specific limitations as regards issuing mortgages. In practice 99,9% of all mortgage lending in Sweden is issued by banks and credit market institutions. We approximate a share of 75% for credit market institutions (mortgage credit institutions) and 25% for banks. Approximately the same as in question 2 above. According to Finansinspektionen the average LTV for new mortgage loans in 2014 is 67%. The distinction is made on how the loan is secured. Residential loans are secured on residential property. Ordinary mortgage loans. Variable interest is the most common interest rate on mortgages. The expected average length of a mortgage loan is 7.5 years. Contractual lengths of mortgage loans vary normally between 30 to 50 years. However, for many different reasons mortgage borrowers either terminate their mortgage permanently or terminate and get a new one before the contractual length is reached. Covered bonds. Different investigations seems to indicate that the level of cost associated with house purchase is very low in Sweden. Transaction costs in Sweden consist mainly of stamp tax (1.5%) and, if you need a loan, mortgage fee (2% of the new or increased mortgage). Normally you do not pay any fee to the mortgage lender. There are no direct subsidies in Sweden. However, borrowers are allowed to deduct 30% of the interest payments from their tax payments. 2015 EMF HYPOSTAT | 81
Page 1 and 2:
EMF Hypostat 2015 September 2015 HY
Page 3 and 4:
Contents Foreword..................
Page 5:
Foreword Finally, in the spirit of
Page 8 and 9:
Housing and Mortgage Markets in 201
Page 10 and 11:
Page 12 and 13:
Page 14 and 15:
Page 17 and 18:
Mortgage Lending in Foreign Currenc
Page 19 and 20:
Page 21 and 22:
Page 24 and 25:
EU 28 Country Reports Austria By Wo
Page 26 and 27:
EU 28 Country Reports Belgium By Fr
Page 28 and 29:
EU 28 Country Reports Bulgaria By M
Page 30 and 31: EU 28 Country Reports Croatia By Al
Page 32 and 33: EU 28 Country Reports Cyprus By Ioa
Page 34 and 35: EU 28 Country Reports Czech Republi
Page 36 and 37: EU 28 Country Reports Mortgage Fund
Page 38 and 39: EU 28 Country Reports Estonia 2013
Page 40 and 41: EU 28 Country Reports Finland Fact
Page 42 and 43: EU 28 Country Reports Mortgage Fund
Page 44 and 45: EU 28 Country Reports Germany By Th
Page 46 and 47: EU 28 Country Reports Greece By Cal
Page 48 and 49: EU 28 Country Reports Greece Fact T
Page 50 and 51: EU 28 Country Reports years will be
Page 52 and 53: EU 28 Country Reports Ireland By An
Page 54 and 55: EU 28 Country Reports Ireland 2013
Page 56 and 57: EU 28 Country Reports At the end of
Page 58 and 59: EU 28 Country Reports Latvia Fact T
Page 60 and 61: EU 28 Country Reports Lithuania Fac
Page 62 and 63: EU 28 Country Reports Luxembourg Fa
Page 64 and 65: EU 28 Country Reports Malta Fact Ta
Page 66 and 67: EU 28 Country Reports Netherlands F
Page 68 and 69: EU 28 Country Reports Poland 2013 P
Page 70 and 71: EU 28 Country Reports Portugal Fact
Page 72 and 73: EU 28 Country Reports Romania 2013
Page 74 and 75: EU 28 Country Reports Slovakia By P
Page 76 and 77: EU 28 Country Reports Slovenia By A
Page 78 and 79: EU 28 Country Reports Spain By Iren
Page 82 and 83: EU 28 Country Reports United Kingdo
Page 85 and 86: Statistical Tables A. The Mortgage
Page 87 and 88: Statistical Tables - The Mortgage M
Page 93 and 94: Statistical Tables - The Housing Ma
Page 103 and 104: Statistical Tables - Funding of the
Page 105 and 106: Statistical Tables - Funding of the
Page 107 and 108: Statistical Tables - Macroeconomic
Page 109 and 110: Statistical Tables - Macroeconomic
Page 112 and 113: Annex: Explanatory Note on Data A.
Page 114: Annex: Explanatory Note on Data Cro
show all

Hypostat 2015

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?