The average mortgage amount increased in the past year by 20%: to NIS 914,000

The average mortgage amount decreased in September by about 3% compared to August to NIS 914,000. This is according to data from the mortgage market published by the Bank of Israel. This is the second month in a row that the average loan for the purchase of an apartment has decreased, after the peak recorded in July and stood at NIS 954.2 thousand. However, the average mortgage amount in September 2021 was 19.7% higher than in September 2020, when it stood at NIS 763,000.
The volume of new mortgages in September fell by about 40% compared to August and stood at about NIS 7.12 billion. The main reason for the decline is the timing of the Tishrei holidays and the shortage of working days in September this year. Compared to September 2020, the total volume of mortgages increased by approximately 12.7%.
Despite the decline in the volume of mortgages in September, the upward trend in the share of investors in the mortgage market continues. In the last month, the number of loans taken from banks for investment apartments was about 15.7% of total loans - an annual record - and an increase compared to 12.1% in September 2020. The financial volume of loans from investors was about NIS 964 million, an increase of about 48% compared To September last year.
The average rate of return on income in September was 26.2%, a slight decrease compared to August (26.4%), July (26.5%), and June (26.6%), when together with the decrease in the average mortgage amount they show a decrease in the risk of mortgages. However, September is not a representative month due to the shortage of working days due to the holidays, and to get a better picture of the trends, the market will wait for October data, then it will be clear whether the mortgage highs recorded in the summer months will be the real estate market.
About two weeks ago, the Central Bureau of Statistics announced that in the past year, housing prices in Israel rose by 9.2%, after a 1.2% rise in prices in July-August 2021 compared to June-July 2021. New house prices rose by 11.8% last year, partly due to a rise in the index Prices of construction inputs jumped by 4.9%.