Stability in mortgages: NIS 52.8 billion in those loans are in the status of deferral (grace)

In October, there was stability in the volume of mortgages that are currently in decline. According to data published today (Tuesday) by the Bank of Israel, NIS 52.8 billion in mortgages are in the status of deferral (grace) in the banks, similar to September, and a share of 13.4% of the total mortgage portfolio, amounting to NIS 395 billion.
In May, at the height of the Corona crisis and the first wave, the volume of deferred mortgages was NIS 94.3 billion (25% of the total mortgages in the system).
 Mortgage data in October indicate the strength of the housing market even in the days of the plague and high unemployment in the economy. In October, 7,783 Israelis took out a loan to purchase an apartment, totaling NIS 6.15 billion - NIS 790,000 on average for a mortgage. In September, the total mortgage reached NIS 6.3 billion and in October 2019 it was only NIS 4.4 billion.
Loans totaling NIS 2.5 billion, 41% of mortgages, were taken out in October at a financing rate of at least 60% of the property value, a slight decrease compared to September (42% of mortgages) but compared to only 36% of loans taken out at a similar financing rate in October 2019.
The weighted real interest rate in the mortgage market stands at only 1%, similar to the last two months, a low level that can explain some of the high demand for home purchase loans.
In October, 1,091 Israelis took out loans to purchase an investment apartment (an apartment that is not their only apartment), in the total amount of NIS 691 million - an average of NIS 640,000 per loan. Despite the reduction in the purchase tax for investors at the end of last July (from 8% to 5% in the first instance), at least for now it seems that the volume of Israelis taking out loans to buy an apartment for investment is not unusual compared to the months before the tax reduction.
Despite the economic crisis and the stability of the number of deferrals vis-à-vis the banks, the rate of housing loans that are in arrears of payments of more than 90 days (without regulated deferral) continued to decline in October. In total, NIS 2.5 billion in loans are currently classified in banks as arrears, 0.65% of the total mortgages, compared with NIS 3.1 billion in April and May 2020 (0.82% of mortgages).