Huismargin

Huismargin is an economic term used primarily in European mortgage markets to describe the minimum equity percentage that a borrower must retain on a residential property financed with a loan. The concept emerged during the 2008 financial crisis to improve the resilience of housing finance systems and prevent the buildup of excessive leverage. The word is a hybrid of the Dutch word huis, meaning house, and the English term margin, reflecting its cross‑border regulatory origins within the European Union.

The calculation of huismargin is straightforward: multiply the current market value of the property by a predetermined percentage set by national regulators, and subtract the outstanding loan balance. The resulting figure must remain non‑negative; should the equity fall below the required margin, borrowers may be required to deposit additional funds, reduce the loan balance, or increase payments to restore compliance. The margin thresholds vary by country and are typically higher for first‑time home buyers and lower for continuing owners with significant equity.

Regulatory frameworks such as the EU Mortgage Credit Directive incorporate huismargin rules into broader prudential supervision. Central banks and national authorities use these metrics to assess systemic risk, and they are regularly reviewed in response to market dynamics or shifts in housing prices. Academic studies assess the influence of huismargin on mortgage growth, default rates, and housing affordability. Although not universally adopted outside Europe, the concept has influenced mortgage regulation in other jurisdictions seeking to balance consumer protection with market stability.