Mortgage numbers aren't showing signs of growth

Mortgages fall 3% to CZK 38.5bn at end-June yr/yr

ČTK | 2 August 2010

 

Prague, July 30 (CTK) - Czech banks provided Kc38.5bn worth of mortgage loans to households in H1 of the year, an annual drop of 3 percent, and Q2 mortgages stood at Kc22.51bn, up 2.2 percent on the year, the Local Development Ministry said Friday.

The volume of mortgage loans to households, businesses and municipalities posted a year-on-year increase of 13 percent to Kc53.6bn at end-June owing above all to mortgages to entrepreneurs that saw almost a double increase to Kc14.9bn annually.

Mortgage banks provided 23,617 loans in Jan to June this year, 270 fewer year-on-year.

Mortgages to households totalled Kc73.85bn last year, 39 percent less annually. 

The mortgage market has been falling since 2008.
A CTK poll among bankers has shown that they expect gradual revival of the market depending on growth in consumer demand. "For the market to revive markedly, it is necessary that people are willing again to make debts. This is not happening for now, people can see no positive economic signals," Tomas Halla of Ceska sporitelna said earlier.

"Mortgages may start rising gradually in the second half of the year at the earliest, revival of interest is foreseen for next year," Halla said.

Komercni banka's Monika Truchlikova said that revival of the real estate market will be of key importance for the mortgage market development. "Given the current development we expect the second half to see the ongoing moderate annual growth in the volume of new mortgages, in the order of units of percent," said Truchlikova.

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