EU plans to integrate mortgage markets

Permalink: EU plans to integrate mortgage markets
by Gill Montia

The European Commission has been working on a number of proposals aimed at improving integration across EU mortgage markets.

However, property experts at Savills Private Finance believe this could prove “quite a challenge”.

The problems that need to be addressed include the difficulties of the cross-border supply of mortgage credit, limited product diversity, low consumer confidence and restricted customer mobility.

According to Miranda John, international manager for Savills, “The main point is that it is such a huge market to consider trying to do anything with. Even within Europe there’s a huge difference between each country.”

In particular, standards of practice vary across European nations. For example, it is common to see advertising in continental Europe that implies that rental income will cover any mortgage.

Ms John points out that: “This obviously does not meet the Financial Services Authority’s regulations in terms of explaining how mortgages work – but within Europe there are no regulations to stop that.”

Both setting up mechanisms to police any integration of EU mortgage markets and securing a form of consensus could prove lengthy and demanding.

However, for the increasing number of UK investors looking for property overseas any level of integration could prove beneficial.