Demand for housing loans in the eurozone fell at the fastest pace on record, according to European Central Bank data that showed how rising interest rates and declining consumer confidence are taking a toll on the property market.
Banks reported that demand for housing loans decreased at its largest rate on record — a net percentage of minus 74 per cent, according to the January eurozone bank lending survey. The figure was the lowest since records began in 2003 and a decline from minus 42 from the previous quarter.
The net decrease in demand “was mainly driven by the general level of interest rates, lower consumer confidence and deteriorating housing market prospects”, stated the survey. A significant tightening in lending criteria for mortgages was also reported.