This report is based on Finansinspektionen's (FI's) third large mortgage survey. The survey is based on comprehensive material from the eight largest banks in Sweden.
The survey demonstrates that the mortgage cap continues to have a positive effect. Just below 11 per cent of the households in the sample have a loan-to-value ratio above 85 per cent. The trend of steadily rising loan-to-value ratios has been broken, and the households' loan-to-value ratio for new loans is still around 70 per cent.
Only one out of ten households has taken an unsecured loan, and all of these households amortize. The survey also shows that close to nine out of ten households with a loan-to-value ratio above 75 per cent amortize. This means that the banks currently are applying the Swedish Bankers' Association's recommendation of amortization for all loans with a loan-to-value ratio exceeding 75 per cent.
However, the percentage of the volume of loans that are amortized in the mortgage stock as a whole is still low. In the sample of new loans only four out of ten households with a loan-to-value ratio of less than 75 per cent amortize. In addition, the average actual repayment period for first mortgages that are being amortized is very long (more than 140 years). An important task, therefore, will be to follow up on the potential long-term risks of the weak willingness to amortize loans that have a loan-to-value ratio below 75 per cent.