EU Commission to Decide on Mortgage Market Action in 2006

Strategic Insights -

The European Commission will decide by January 2006 whether to take action on a proposed Green Paper aimed at developing the EU mortgage market. The paper, published as part of a four-stage process, reflects the complexity of the issue and puts forward options for areas such as consumer protection and mortgage credit funding.

Key Takeaways:

  • The Green Paper is part of a four-stage process, which also includes a cost-benefit study, a hearing, and a report from an expert group on mortgage credit.
  • The expert group has recommended 48 different actions that could be taken by the Commission to develop the EU mortgage market.
  • The Green Paper explores options for areas such as consumer protection, the funding of mortgage credit, and the need for EU standards for mortgage information.
  • The EU mortgage market is substantial, with outstanding residential mortgage balances standing at about €4.2 trillion in 2003, equivalent to about 40% of EU GDP.
  • The Commission is also considering proposals for a Directive on payment systems and an asset management Green Paper.
  • Stakeholders are invited to comment on the Green Paper by November 30, 2005.

Statistics:

  • 48: the number of different actions recommended by the expert group on mortgage credit.
  • €4.2 trillion: the outstanding residential mortgage balances in the EU at the end of 2003.
  • 40%: the percentage of EU GDP accounted for by outstanding residential mortgage balances in 2003.

Sources:

  • "48 ways to leave your lender." (2005)
  • A report from the Forum Group of experts on mortgage credit, published in December 2004.
  • A cost-benefit study, to be published by the Commission in August 2005.
  • An asset management Green Paper, recently published by the Commission.
  • A Directive on payment systems, to be proposed in the autumn, most likely on October 5.
  • http://europa.eu.int/comm/internal_market/finservices-retail/home-loans/index_en.htm