Mortgage market 2.1% higher at CZK 122bn in 2012

Prague, Jan 27 (CTK) - Czech banks last year provided 73,595 mortgage loans to households for Kc121.6bn, an annual hike of 2.1 percent, according to statistics of the Local Development Ministry.

The market growth accelerated in the last quarter which saw a rise of almost 23 percent compared with Q4 2011.

A total of 74,745 mortgage loans worth Kc145.5bn were granted to households, firms and municipalities last year, the number and volume of loans posting a rise of 3 percent in annual terms.

Stable prices of real estate and record-low interest rates are among the main contributors to the estimate of the new mortgage market last year at Kc122bn, which is seen as an exceptional result in view of the economic development in the Czech Republic and in Europe, said Hypotecni banka director Jan Sadil.

Average interest rate on mortgages was falling in the second half of the year, hitting new record lows each month starting in August. In December it was 3.17 percent, the lowest level since 2003 when the Hypoindex's monitoring started.

Average interest rate reached 3.52 percent for the full year 2012, down from 4.04 percent in 2011 and from 4.9 percent in 2010.

Mortgage loans granted to households in 2001 to 2012 (in Kc bn):

2001 14.7
2002 22.5
2003 36.2
2004 52
2005 72.1
2006 100.8
2007 142.3
2008 120.1
2009 73.9
2010 84.8
2011 119.1
2012 121.6

Source: Local Development Ministry