Housing loans are borrowing arrangements used by households to finance residential property. They cover the acquisition of an existing dwelling, the construction of a home and substantial improvements to one. The standard form is a mortgage, in which the dwelling serves as collateral. Statistical classifications may also count personal loans whose stated purpose is the purchase of a home, provided that purpose can be identified, even when no property security is attached. Financing backed by another asset may likewise fall within the category. Whether construction and major renovation are recorded alongside purchases depends on the statistical framework; both may be treated as investment in housing.
Source: European Central Bank (ECB) (source). This glossary entry is an independently worded adaptation of the cited information.