NIS 4.1 billion in new mortgages were granted in November 2012, the Bank of Israel reported today. The amount is in line with the figure reported by "Globes" on November 28.
On November 1, the Bank of Israel's new mortgage restrictions came into effect. Despite the restrictions and Operation Pillar of Cloud, new mortgages granted in November were 42.6% higher than in November 2011 and 21% higher than in October, which included holidays.
NIS 3.1 billion of the new mortgages granted in November were variable interest mortgages, and NIS 996 million were fixed-interest mortgages. Fixed-interest mortgages were 23% higher than in October, and variable interest mortgages rose by 20.7%.
Mortgage market sources expect that more new mortgages will be granted in December than in November, because homebuyers who present the bank with a purchase contract by the end of the year will be able to obtain a mortgage even if they do not meet the Bank of Israel's new mortgage restrictions.
The new restrictions were not felt in the first month since they came into effect, but it is premature to determine that they are ineffective. Banks believe that only in a few months will it be possible to assess whether the loan-to-value (LTV) restrictions have succeeded in cooling the housing market. Market sources expect the amount of new mortgages to decline in early 2013, both because this is traditionally a weak season in the market, and because the Bank of Israel's new restrictions will begin to have an effect.
Published by Globes [online], Israel business news - www.globes-online.com - on December 11, 2012
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