Home loans in Spain September 2020, levels increase
Mortgages Spain September 2020. September saw Spanish mortgage levels bounce back post re-opening after lockdown.
Whilst the month was positive for Spanish mortgages. It remains to be seen if the resurge in COVID 19 cases. Also new restrictions dampen activity. Therefore whether Octobers figures will show increases.
Spanish loan completions delayed during the lockdown. Also house sales. Completed in September.
Brexit is still putting pressure on level of non resident buyers and non resident mortgage applicants. Spanish Banks remain cautious with UK applicants. In particular about the economic fallout of not just COVID 19, but the UK transition period coming to an end.
There is some anticipation that many expats will look to sell and return to UK. Mainly over concerns of future health care cover. However at present there is no large exodus of people.
Travel restrictions may affect Mortgages in Spain
Limitations on travel, post end of December. Also restrictions for UK holiday home owners to only be able to stay 3 months out of any 6. Without a visa or residencia, may also upset the buying and loan application market for a while.
Long term it is unlikely to adversely affect the level of UK based mortgage applicants for mortgages in Spain. For a traditional holiday home the 3 month period will probably suffice. In the same way as it does for other nationalities not in the EU.
Loan sizes hold up for Mortgages Spain September 2020
In September the average loan size for a mortgage in Spain was 135k the previous month was 134.7k and same month of 2019 136.5k.
The number of new loans reached 26.878 35.6% up on last month, and 18.4 % up on same month of previous year.
Capital lent due to the higher numbers and higher average loan sizes saw an increase of 35.9% over last month and 17.2% over last year.
New credit predominately for home loans in Spain
A large percentage of all new credit flowing into the system, 69.6% was designated for home loans.This is unusual.
Interest rates remain very stable average rate in the month over a 23 year term was 2.44%. The average variable rate being 2.12%, and the average fixed rate 2.84%
The rates were marginally down from previous month. A reflection of the small drops in 12 month Euribor over last 3 months.
Variable rate product types
Loan contracts established in the month 55.2% were signed on a variable rate basis. 44.8% on a fixed rate basis. Apart from one month this year this is a normal split of mortgage type signings.
Regionally most regions saw increases in the month. The Balearics after a slow first few months saw an increase over last month of 63.3%. Madrid levels were also high increasing by 66%.
The Canary Islands perhaps because of travel distances was only up 3% but unlike mainland Spain they have not had the same recent travel bans so this may balance out by end of year.
Spanish Banks still have net mortgage book inflows
20.918 mortgages in Spain were cancelled in the month. Spanish Banks experienced another month of net inflow. Therefore Mortgage books increased.