At the end of the second quarter of this year, the Mortgage Load Index (IOH) amounted to 38.34% and was by 1.77 percentage points. higher than the one recorded at the end of the first quarter (36.57%). This means that at the end of June this year. a statistical Polish family had to spend 1.77% more of their average monthly net income on repayment of a new mortgage to buy a flat on the primary market than at the end of March.
Developing the Mortgage Load Index is very important for all families who plan to take out a new loan for the purchase of an apartment on the primary market, including in the context of restrictions resulting from the Recommendation T implemented by the end of last year, it is worth recalling that according to the recommendations Polish Financial Supervision Authority “the maximum level of the ratio of expenditure related to servicing credit obligations to average net income achieved by persons obliged to repay the debt should not be higher than 50% for retail clients with net income not exceeding the level of average remuneration in the economy, but in no case should be higher than 65%. “
What decided about the changes?
In March-June 2011, the increase in the Mortgage Load Index (IOH) illustrating the trend for the 8 largest Polish agglomerations was determined by the negative behavior of two of its three components. The prices of 55m2 flats on the primary market increased by an average of 1.49%, i.e. by about $ 92 to the level of $ 6278.75 per m2, and the interest rate on loans taken out for their purchase went up by an average of 0.41 percentage points. from 5.84% to 6.25%. In the latter case, the 3-month Wibor rate increased by 0.5 percentage point. from 4.19% to 4.69% could not be neutralized by a decrease in the average banking margin from 1.65% to 1.56%. However, IOH was slightly reduced by the fact that its third component, i.e. the average gross salary in the enterprise sector, increased by $ 36 to $ 3,574.06 on average.
In the regions, the situation has not changed much
At the end of June, as at the end of March, the lowest IOH was for Karowice (29.54%) and the highest for Brakow (44.46%). The cities listed above are also characterized – which of course results from the index structure itself – the lowest and highest ratio of the average offer price per square meter of housing on the primary market to the average gross remuneration in the enterprise sector in the voivodships covering them. At the end of June, this ratio was the lowest for Karowice (136%) and the highest for Brakow (204%).
The Mortgage Debit Index shows how much of Polish families’ net income is absorbed in repayment of a new mortgage. IOH is prepared as an average for the 8 largest Polish agglomerations, assuming that a loan for 30 years for the purchase of a 55-meter flat is taken by a family of two, earning twice the average monthly salary in enterprise sector for a given province. The index is also calculated as the average for loans with LTV (loan to value) at the level of 100 and 80. The following factors have an impact on IOH: offer prices of flats on the primary market for a given agglomeration, the level of average net remuneration in a given voivodship and the current loan interest rate. The basis for the prices of flats used in the construction of the index are the data provided by redNet Consulting on the basis of the tablesesofert.pl The index is prepared with an approximately one month delay compared to the end adopted by Mr. Credit Quickie. Kurtz of the quarterly reporting period, as the data of the Central Statistical Office on remuneration in individual voivodships are available only at the end of the month, which follows the month to which they refer.