The volume of mortgage loans granted by banks during 2021 jumped by 49% compared to 2020, and amounted to a peak of NIS 116 billion. This is according to data from the Bank of Israel published yesterday.
During December 2021, NIS 12.2 billion in mortgages were taken out, compared with NIS 11 billion in November and NIS 8.3 billion in December 2020. The volume of mortgages taken out in December 2021 was the highest of all months of the year.
The increase in mortgages is explained by an increase in the volume of demand for apartments and sales of contractors. Data from construction companies published in recent days indicate a jump of tens of percent, both in the volume of apartment sales and in the average value of the apartment sold.
According to the Central Bureau of Statistics (CBS), housing prices have risen by an average of 10.3% in the past year. As a result, the public is flocking to mortgages, and banks are supplying demand. And therefore they are increasing their activity in the field.
The Supervisor of Banks, Yair Avidan, is troubled by the boom in the mortgage market. Against this background, he addressed the managers of the banks at the beginning of last week with a request to price the mortgage risks, set aside in the 2021 balance sheets and classify the problem credit in a higher amount.
At the same time, he asked them to specify in the financial statements the considerations for granting the loan, the amounts of loans by sector and the nature of the collateral.
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