Data out from the INE in Spain today shows yet another month of net outflows in number of mortgages in Spain.
Average loan sizes granted in April this year for residential property was 94.023 Euros which is a decrease of 5.8% on April of last year and 2.7% less than March 2013. This trend continues as house prices continue to drop year on year and is a reflection of the overall market situation.
Total numbers of loans granted dropped by 18.1% from April of last year but for the first time in the last 5 years the number of new mortgages constituted rose in April in comparison to the previous month. The amount of new loans signed at Notary were 17,508 which was 7.6% up on March of this year. Capital lent also increased from March this year but the annual and year on year figures remain down.
Average interest rates for new loans on residential property stood at 4.57% in April an increase of 4.94% from April last year, this is despite the fact the Euribor has dropped considerably within that timescale. Margins above Euribor charged by the Banks therefore continue to climb making Spanish loans some of the most expensive in Europe.
Subrogation the practice of allowing new buyers to take over existing loans rather than setting up new ones was down a massive 42.8% from April 2012 again a reflection of Banks not wanting to take on new borrowers preferring to have the loan redeemed, and a reflection of Banks not wanting old loans at historically low margins to remain on their books.
Total cancellations of residential loans in April 2013 was 26,739, with new loans totaling 17,508 it is yet another month of net mortgage outflows as Banks continue to reduce their overall mortgage books.