Mortgage Activity Remains High in September Despite Holidays
Translated & summarized from Globes by baba
Mortgage lending in Israel reached 8.66 billion shekels in September, despite the High Holidays, according to the Bank of Israel. This volume, though down 20% from August, shows strong activity and is 9% higher than during Passover holidays. Year-to-date housing credit is up 12% compared to last year, exceeding 2021-2022 peaks.
The story in 5 lines · by baba
- Israeli mortgage lending hit 8.66 billion shekels in September despite holiday disruptions.
- September's mortgage volume was 20% lower than August but still showed significant activity.
- Year-to-date housing credit has increased by 12% compared to the previous year.
- All-purpose loans accounted for 4.9% of total mortgage transactions in September.
- Deferred loan types like 'balloon' and 'bullet' loans now represent about 13% of mortgages.
Despite the Jewish High Holidays, the volume of mortgages taken out in September reached 8.66 billion shekels, according to a partial review by the Bank of Israel. While this figure was approximately 20% lower than in August, it still represents significant activity, especially considering the reduced number of working days due to the holidays. Compared to April, which also had many holidays due to Passover, September's mortgage volume was about 9% higher, indicating substantial approvals during the limited working days.
The Association of Mortgage Advisors noted that the proportion of all-purpose loans increased to 4.9% of total transactions. Year-to-date, housing credit performance stands at 88.3 billion shekels (93.3 billion shekels including all-purpose loans), a 12% increase from the same period last year, surpassing the peak performance of 2021 and 2022. This active credit market, contrasted with weaker new real estate transactions, suggests that past contractor financing deals are maturing into actual mortgages.
Furthermore, the share of deferred loans, such as 'balloon' and 'bullet' loans, continued to decline slowly, reaching about 13% of all mortgages last month. This trend is seen as a potential indicator of a gradual decrease in contractor loan schemes. The strong mortgage market activity in September, a month characterized by holidays and extended weekends, suggests that October's figures may be even higher, as they are expected to include mortgage applications deferred from the previous month.
