FI-analysis 12: The mortgage cap reduced household debt

This FI Analysis presents an assessment of the Swedish mortgage cap. The analysis indicates that the mortgage cap has changed household behaviour. Households with new mortgages borrow less than what they would have done if FI had not implemented the mortgage cap. They are also buying less expensive homes.

The effect of the mortgage cap is larger for households outside the metropolitan regions. It is primarily there households with high loan-to-value ratios have borrowed less and purchased less expensive homes. The youngest and the oldest households also appear to have reduced their debt the most, although young households purchased homes that were just as expensive. This can be a sign that young households are more likely than older households to use other types of financing than mortgages when purchasing a home.

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