New Mortgage Lenders and the Housing Market*

2020 ◽  
Author(s):  
Nikodem Szumilo
Keyword(s):  
Risk Taking ◽  
Financial Stability ◽  
House Prices ◽  
Housing Prices ◽  
Real Estate Market ◽  
Mortgage Lending ◽  
Mortgage Market ◽  
The Real Estate ◽  
Banking Market ◽  
The Real Estate Market

Abstract This article examines the effect of a new lender’s entry into a local mortgage market on the supply of new loans, housing prices and repossessions in areas around its branches. I use the decision of the European Commission to force the UK’s largest retail bank to divest a part of its business as a shock to the entry of a new lender, and show that incumbent banks increase mortgage lending in areas where the new bank has its branches. Furthermore, house prices increase by around 5% in the real estate market impacted by the shock. Average transaction numbers and mortgage repossession rates also increase in places where the new bank enters. Overall, my results show that increased competition in the banking market can have adverse consequences for risk-taking and financial stability.

scholarly journals Impact of Government Measures to Support Mortgage Lending on Housing Affordability in Russia: Regional Evidence

2021 ◽  
Vol 80 (4) ◽  
pp. 98-123
Author(s):  
Ianina Roshchina ◽  
◽  
Natalia Ilyunkina ◽  
Keyword(s):  
Housing Prices ◽  
Real Estate Market ◽  
Mortgage Lending ◽  
Housing Affordability ◽  
Government Support ◽  
The Real Estate ◽  
The Real Estate Market ◽  
Support Housing ◽  
Quantitative Indicators ◽  
The Impact

This study investigates housing affordability in Russia: factors of affordability, quantitative indicators, and government support measures. We are especially interested in the mortgage rate subsidy programmes that were implemented in 2015–2016 and 2020–2021 and their impact on housing affordability indicators. In order to evaluate impact of the first programme, we use a model of the real estate market and we decompose the index of housing affordability into different factors. As a result of our econometric analysis, we conclude that in general the programme was successful. Data about the second programme are not yet sufficient, so we evaluate its impact by a statistical analysis of the dynamics of the main indicators. We conclude that the impact is ambiguous: up until a particular moment (different in different regions), borrowers could benefit from the programme, but after that moment the increase in housing prices caused by the programme itself were exceeding the benefits from the subsidised rates. In conclusion, we provide some methods to improve the effectiveness of government measures to support housing affordability, which could be useful in the development of new programmes.

scholarly journals Bank Competition and Financial Stability: Evidence from the Financial Crisis

2016 ◽  
Vol 51 (1) ◽  
pp. 1-28 ◽  
Author(s):  
Brian Akins ◽  
Lynn Li ◽  
Jeffrey Ng ◽  
Tjomme O. Rusticus
Keyword(s):  
Financial Crisis ◽  
Financial Stability ◽  
Housing Prices ◽  
State Level ◽  
Real Estate Market ◽  
Bank Competition ◽  
Banking Competition ◽  
The Real Estate ◽  
The Real Estate Market ◽  
Recent Financial Crisis

AbstractWe examine the link between bank competition and financial stability using the recent financial crisis as the setting. We utilize variation in banking competition at the state level and find that banks facing less competition are more likely to engage in risky activities, more likely to face regulatory intervention, and more likely to fail. Focusing on the real estate market, we find that states with less competition had higher rates of mortgage approval, experienced greater inflation in housing prices before the crisis, and experienced a steeper decline in housing prices during the crisis. Overall, our study is consistent with greater competition increasing financial stability.

scholarly journals MORTGAGE LENDING MARKET IN THE RUSSIAN FEDERATION: CURRENT STATE, PROBLEMS AND PROSPECTS

2021 ◽  
Vol 2 (53) ◽  
pp. 72-78
Author(s):  
S.A. Starykh  ◽  
◽  
S.A. Lavoshnikova  ◽  
 A.D. Chesnokova ◽  
Keyword(s):  
Real Estate ◽  
Russian Federation ◽  
Real Estate Market ◽  
Mortgage Lending ◽  
Mortgage Market ◽  
The Real Estate ◽  
Financial Bubble ◽  
The Real Estate Market ◽  
The Russian Federation ◽  
The Impact

Subject. The market of mortgage housing lending in the Russian Federation. Topic. The impact of the coronavirus pandemic on the mortgage lending market. Purpose. Analyze the housing mortgage lending market in the Russian Federation and identify the reasons for its explosive growth in the 3rd and 4th quarters of 2020. Methodology. Methods of comparative analysis of the housing mortgage lending market in the Russian Federation. Results. The possibility of the formation of a financial bubble in the real estate market in Russia is studied, and the probable prospects for the development of the mortgage market are evaluated Application area. The mortgage lending market, including the behavior of borrowers (buyers in the housing market) and the activities of credit institutions. Conclusions. The article analyzes the housing mortgage lending market in the Russian Federation and identifies the reasons for its explosive growth in the 3rd and 4th quarters of 2020. The article examines the impact of the coronavirus pandemic on the mortgage lending market, including the behavior of borrowers (buyers in the housing market) and the activities of credit institutions. The possibility of the formation of a financial bubble in the real estate market in Russia is studied, and the probable prospects for the development of the mortgage market are evaluated. Keywords: mortgage lending, deferred demand, financial bubble, coronavirus pandemic, mortgage lending rate, key rate, average credit rating of the borrower, overdue debt, bankruptcy, reserves for possible losses.

scholarly journals The Influence of Home Buyer Sentiment on Chinese Housing Prices—— Based on Media Text Mining

2018 ◽  
Vol 10 (9) ◽  
pp. 145
Author(s):  
Qing Gao ◽  
Tianxiao Zhao
Keyword(s):  
Text Mining ◽  
House Prices ◽  
Housing Prices ◽  
Real Estate Market ◽  
Factors Affecting ◽  
The Real Estate ◽  
The Real Estate Market ◽  
Long Time ◽  
Confidence Index ◽  
Home Buyer

In recent years, housing prices in major cities in China have generally maintained an upward trend, and housing prices have remained high for a long time. China’s economic growth has its own particularity in the world, and the real estate market as a major support point for the economy, its future development is crucial to the economy. Taking Guangzhou as an example, this paper uses text mining method to extract media influence from media texts, and constructs the buyer confidence index, and uses it as a proxy variable for buyers’ mental expectations. This article finally obtained a total of 115,139 articles on the housing market, forming an article pool for text mining. In the study and analysis of the explanatory effect of the home buyer confidence index on housing prices, this paper uses multiple linear regression to analyze the main factors affecting housing prices, and concludes that buyers’ sentiment is significantly positively correlated with house prices.

scholarly journals Real estate boom in Chile and fundamentals on house prices

2020 ◽  
Vol 6 (1) ◽  
pp. 1-26
Author(s):  
C. Aguilera Alvial
Keyword(s):  
Real Estate ◽  
Interest Rates ◽  
Structural Breaks ◽  
House Prices ◽  
Housing Prices ◽  
Real Estate Market ◽  
The Real ◽  
The Real Estate ◽  
Integration Test ◽  
The Real Estate Market

This article studies the fundamentals of housing prices based on the Real Index of Housing Prices (IRPV), given that in recent times in Chile there has been a sustained increase in price levels and seeks to find evidence on the existence of a possible speculative bubble in the real estate market. Following the methodology of various Chilean and international authors, the Engle & Granger Co-integration methodology was applied. Furthermore, the results of the previous methodology were compared using the Johansen Co-integration test. Then a method to find structural breaks is applied. As a result, evidence is found to not reject the existence of a bubble in the real estate market. It is found that only interest rates co-integrate in the long term with the evolution of house prices, while the other fundamentals present a spurious relationship.

scholarly journals Modeling the Real Estate Prices in Olsztyn under Instability Conditions

2012 ◽  
Vol 11 (1) ◽  
pp. 61-72 ◽  
Author(s):  
Mirosław Bełej ◽  
Sławomir Kulesza
Keyword(s):  
Real Estate ◽  
Housing Prices ◽  
Intrinsic Property ◽  
Small Variation ◽  
Smooth Curve ◽  
Real Estate Market ◽  
The Real ◽  
The Real Estate ◽  
The Real Estate Market ◽  
The Stability

Abstract The paper deals with the description of the issues related to the dynamics of the real estate market in terms of sharp, unexpected changes in the housing prices which have been observed in the last decade in many European countries due to some macroeconomic circumstances. When such perturbations appear, the real estate market is said to be structurally unstable, since even a small variation in the control parameters might result in a large, structural change in the state of the whole system. The essential problem addressed in the paper is the need to define and discriminate between the intervals of stable and unstable real estate market development with special attention paid to the latter. The research aims at modeling hardly explored field of discontinuous changes in the real estate market in order to reveal the bifurcation edge. Assuming that the periods of sudden price changes reflect an intrinsic property of the real estate market, it is shown that the evolution path draws for most of the time a smooth curve onto the stability area of the equilibrium surface, and only briefly penetrates into the instability area to hop to another equilibrium state.

An Institutional Countermeasure to China's High Urban Housing Prices

2013 ◽  
Vol 448-453 ◽  
pp. 4075-4078
Author(s):  
Jin Zhang
Keyword(s):  
Civil Rights ◽  
Real Estate ◽  
Institutional Economics ◽  
Housing Prices ◽  
Urban Housing ◽  
Real Estate Market ◽  
System Level ◽  
The Real Estate ◽  
Economic Phenomenon ◽  
The Real Estate Market

The economic phenomenon of high urban housing prices in our country reflects asymmetry of rights and interests among government, real estate developers and buyers in essence, and behind this economic phenomenon imbedded financial crisis as well as political and social crisis. Regarding academic thought on the causes of high housing prices in the real estate market such as the theories of supply anddemand, cost, the system, and power imbalance between interest groups, this thesis proceeds institutional analysis, from the perspective of institutional economics, discusses the institutional causes of the persistent existence of four factors theories in the angle of vacancy of civil rights in the supply process of institution and rules, and puts forward policy suggestions of increasing effective supplies of institution in the system level.

scholarly journals Homeownership Rate and Other House Price Determinants Impacts on New House Prices in Colombia

2020 ◽  
pp. 35-50
Author(s):  
Hector Botello-Peñaloza
Keyword(s):  
Real Estate ◽  
House Prices ◽  
Housing Prices ◽  
House Price ◽  
Real Estate Market ◽  
The Real Estate ◽  
Homeownership Rate ◽  
Colombian Government ◽  
Price Determinants ◽  
Price Instability

Homeownership remains a preferred form of tenancy in different parts of the world. The attractions of security, stability, investment potential and a sense of pride outweigh the fear of price instability. For this reason, the Colombian government has encouraged in recent years, various demand policies that have sought to promote the increase in the number of homeowners. However, these ideas could have a severe impact on prices in the real estate market. Therefore, this study seeks to examine the effect of homeownership rate on new house prices in an emerging country with low real estate ownership, credit restrictions and average per capita income. The study uses panel data model to examine the influence of housing tenancy and other variables on the variation of housing prices in Colombia. Data were obtained from various sources including the Central Bank of Colombia, Financial Superintendence of Colombia, and National Administrative Department of Statistics of Colombia. The results show that homeownership rates have a positive effect on the price of new homes, which supports the hypothesis of the research. The population growth of the cities is the factor that is most relevant when explaining the price variations.

scholarly journals Assessing Financial Stability Risks from the Real Estate Market in Italy

2016 ◽  
Author(s):  
Federica Ciocchetta ◽  
Wanda Cornacchia ◽  
Roberto Felici ◽  
Michele Loberto
Keyword(s):  
Real Estate ◽  
Financial Stability ◽  
Real Estate Market ◽  
The Real ◽  
The Real Estate ◽  
The Real Estate Market
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