Finance: LATIN AMERICA'S MORTGAGE MARKET

Since 2003, mortgage credit in Latin America has expanded at an annual rate of 14 percent (adjusted for inflation)-well above rates observed in emerging Asia but below the exorbitant rates seen in emerging Europe before its housing bust. Despite the recent growth, the mortgage market in most Latin A...

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Bibliographic Details
Published in:Americas quarterly 2012-10, Vol.6 (4), p.128
Main Authors: Cubeddu, Luis, Tovar, Camilo, Tsounta, Evridiki
Format: Magazinearticle
Language:English
Subjects:
Banking
Economic growth
GDP
Gross Domestic Product
Housing prices
International finance
Metropolitan areas
Mortgages
Risk assessment
Studies
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Summary:Since 2003, mortgage credit in Latin America has expanded at an annual rate of 14 percent (adjusted for inflation)-well above rates observed in emerging Asia but below the exorbitant rates seen in emerging Europe before its housing bust. Despite the recent growth, the mortgage market in most Latin American economies (except Chile) remains relatively small by international standards. [see chart] In the six most financially open Latin American economies (Brazil, Chile, Colombia, Mexico, Peru, and Uruguay), mortgages average just 7 percent of GDP, compared to over 20 percent in emerging Asia and over 65 percent in the United States. [...]the bulk of mortgage credit in Latin America continues to be provided by commercial banks, funded primarily through domestic deposits, with only a small share securitized.
ISSN:1936-797X