“Armored” appear Greek real estate market and Banking system against a sudden increase in interest rates. According to data included in the UBS pan-European analysis, Greece has the lowest percentage of households burdened with servicing a home loan. In particular, only 11.8% are exposed to the risk of an increase in the interest rate, since the rest of the households are either renters (26.7%) or owners without a mortgage.

By contrast, Norway has a corresponding percentage of 61.4%, followed by the Netherlands at 60.4%. In these countries, the risk is clearly higher, given the significant increase in the monthly payments that households have to service due to rise in interest rates. At the same time, although house prices continue to rise, the pace of growth has begun to slow down. For example, in Norway, annual price growth was 6.3% compared to 9.4% in Greece.

The highest percentage is in Norway (61.4%) and the Netherlands (60.4%).

Undoubtedly, the low exposure of Greek households to the mortgage market is due to a number of reasons arising from intermediation economic crisis. In previous years, a large-scale liquidation process of red mortgages was carried out, the amount of which is estimated at 45 billion euros. At the same time, starting from 2010, the demand for new mortgage lending collapsed as a result of the financial crisis, and the banking system itself could not enter the mortgage market further precisely because of the volume of non-performing loans. which he had to decide.

It should be noted that the tightening of creditworthiness criteria and the deterioration of the purchasing power of citizens have led to the impossibility of access to bank loans for the vast majority of households. The result of this process was a complete change in the situation in the real estate market compared to the period before the financial crisis. In particular, today it is estimated that 75% of real estate purchases are made in cash, without the mediation of the banking system. On the contrary, before 2010 the picture was diametrically opposite, as 75% of transactions were made with the help of a bank loan and only the remaining 25% in cash.

In its analysis, UBS states that countries such as Sweden, Norway, Denmark, the Netherlands, the UK, Finland and the Baltic countries are more vulnerable to interest rate risk, while major European economies are better off, Germany, France, Italy and Spain. As noted in the analysis, in the period 2019-2022, house prices in the Eurozone rose by an average of 20%. This is the highest growth rate since the late 1990s, peaking in the first quarter of 2022 at 9.8% year on year. Over the same period, mortgage lending in the euro area increased by 13%, pushing borrowing to its highest level since 2008. In this context, UBS notes that households in countries such as Finland, Sweden, Bulgaria and the Baltic states are perhaps the hardest hit, where variable rate mortgages make up the largest percentage of the total.