Mortgages in Spain and Property purchase data
The end of February saw data published on both Decembers loan and purchase information in Spain along with an overview of the total year.
For the month of December the sale of dwellings increased by 9.2% on the same month of the previous year and finished the year up 14.2% on 2016.
Whilst this was good news house sales were down on Novembers figures by 20.6% the biggest month over month drop between these two months in 5 years.
The number or re-sales totaled 26,500, with new build house sales only reaching 5,700. Steadily since 2013 the sale of new builds in Spain has dropped as a percentage of total sales and in absolute numbers.
Total number of homes sold reached 464,400 in 2017 up from 405,400 in 2016.
This is a significant rise from the 312,600 in 2013 which was the first year of any real recovery. Re-sales over the last 5 years have lead the way with new build sales falling significantly from 143,800 in 2013 to 83,000 in 2017.
During the same period Spanish Banks have improved lending facilities and there has been a marked upturn in the last couple of years in foreign buyers.
Lending for December
New Spanish loans in December, in terms of numbers, was the same as December of the previous year. A total of 20,681 new loans were registered. The average loan size was slightly up on December of 2016 meaning actual capital lent increased by 2.6%.
When looking at the data against November of 2017 the month struggled with the number of loans being down by 16.9%, the capital lent reducing by 21.7% due to a significant drop in the month of the average loan size.
The average loan size for house purchases dropped from € 122.7k in November to 115.6k. This was the first drop in average loan size for four months.
Mortgages in Spain granted for the purchase of dwellings made up 61.6% of all the new credit in the market. This was an increase on the last few months but still below what has been an average.
What is happening to interest rates
The average Interest rates rose slightly to 2.73% from 2.71% but remained well below the same month of the previous year when rates were 3.15%.
The average term for a mortgage in Spain was 23 years and 37.5% of all new lending was contracted on a fixed rate mortgage type basis. The typical variable rate was 2.54% down 18.3% and the typical fixed rate was 3.13% down 3.5%.
Canary Islands leads the way in December
Regionally in the month of December best performer was the Canary Islands up 43.9% on the month of number in terms of numbers and 38.6% in terms of capital lent.
Most other regions saw a drop both in terms of month on month and against the same month of the previous year.
2017 better year for Mortgages in Spain and house sales
The accumulated results for the year were in general very positive.
Total number of properties bought with a mortgage was 310,096 up by 9.7% in 2016. There has been loan growth for the last 5 years now and whilst the growth has slowed a little it continued in 2017. Numbers of Mortgages in Spain in 2013 only reached 199,700 and even that was a small increase on 2012.
The level of capital lent to buy a home or second home in 2017 was 36.190.971 and was up 16.6% due to an increase in the average loan size.
The increase in the loan size may well be due to a slow but steady growth in the purchase price of many properties in most areas.
Regionally the star performers of 2017 tended to be the regions that are most attractive to Foreign buyers in Spain.
Areas like Catalonia and the Balearics also saw a significant increase in average loan sizes due to these areas seeing increases in prices.
Andalucia completed on the highest level of absolute loans at 60,240 the region was well above the next best which was Madrid who completed on 56,644 new loans.
Valencia saw a healthy increase in the number of new Spanish mortgages, Murcia struggled increasing by only 4.3% but overall all regions saw some increases in both numbers of new loans and capital lent in the year.
Spanish Mortgage books decline but rate of decline slows
For the Spanish Banks the year was brighter in terms of net outflows the total number during the year of cancelled loans was 313,716 so whilst more loans went off the books than added the gap narrowed during the year.