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ISSN: 2306-3483 (Online), 2071-8330 (Print)

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How to breathe a new life into the global mortgage market? - An alternative solution

Vol. 14, No 2, 2021


Levente Kovacs


Institute of Finance and Accounting, 

University of Miskolc, 


ORCID 0000-0002-6691-4505

How to breathe a new life into the global mortgage market? - An alternative solution

Szabolcs Pasztor


Department of Economics and International Economics, 

University of Public Service,


ORCID 0000-0001-8606-8142 




Abstract. The growing population of the world, the rising standards of living in most of the countries coupled with the COVID-19 related inflation fears has called our attention to the issue of housing. The aim of the paper is to give a brief introduction to the anomalies of the global mortgage markets. After having studied different continents and countries, the most pressing problems are presented, and the study confirms the fact that in general the initial monthly obligations place a huge financial burden on households. This fact limits the room for manoeuvre of the young families when buying a property. With the concept of adjustable net present value of the repayments, a new mortgage market formula is introduced. In general the solution may provide more flexible monthly repayments in present value terms for the borrowers. The new approach could be an alternative to renting properties, it may help young families achieve home ownership and at the same time it may mitigate the problems of the currently rather unhealthy global mortgage market tendencies.


Received: July, 2020

1st Revision: April, 2021

Accepted: June, 2021


DOI: 10.14254/2071-8330.2021/14-2/12


JEL ClassificationE43, G21, O18

Keywordsglobal residential mortgage markets, new formula, adjustable net present value