Residential real estate valuation and its influence on the mortgage market

The influence of real estate valuations on the mortgage market and the connection between the two elements are very clear nowadays. However, it needs to be remembered that this was not always the case in the past. Only the gradual development of our residential market and the simultaneously developing mortgage market changed the situation. There was a time when the banks did not make valuations according to our present standards. The market reality soon challenged these practices and a natural trend emerged among banks to determine the risk involved in granting mortgages more precisely, as a consequence of the volume of bad debt. This is directly connected with the value of real estate as the collateral of a mortgage. The first few signs appeared that the issue had to be treated by the banks as a higher priority. And 2008, when the market collapsed, was a significant moment. It was a very strong signal that the market required some serious changes in this respect and a different strate