23/12/2014 – Cinco Días
24.240 mortgage foreclosures over the third quarter
Between June and September, the number of homes of main residence foreclosed due to unpaid mortgage has gone up to 6,787 – 13.5% more than over the same period in 2013 but 29.4% less than in the previous quarter.
According to research published today by the National Statistics Institute (INE), looking at initiated foreclosures and new entries in the property registers, these foreclosures have increased by 10.5% up to 23,240, although they fell by 29.5%, when compared to the period from April-June in 2014.
Most of them, 22,135, were urban properties – 9.8% more than last year’s but 29.4% less than the previous quarter’s, while the remaining 1,105 were rural properties – 25.4% more than in 2013, although 30.4% less than between April and June this year.
13,741 or 59.1% of the total of urban properties were residential housing units, which translates into an increase of 11.7%, compared to 2013, but this is 28.3% less than in the previous quarter.
A total of 8,870 or 29.2% of them were owned by private owners (up 14.7%), while 4,961 or 21.3% by businesses (up 6.8% ), and 8.6% by private individuals.
Mortgage foreclosure is a measure which orders a mortgage-holder defaulting on their obligations to sell the real estate property, but judicial proceedings may lead to several outcomes of a foreclosure process and not all initiated foreclosures end with the release or eviction of the homeowners.
The spokesperson of the Spanish Banking Association (AEB) commented on the matter before Efe, pointing out that this is, to a large degree, due to the fact that banks have helped more than half a million families refinance their mortgage loans in order to adjust them to their current ability to pay.
Overall, the INE states that in the case of evicted private property owners, 77.3% were from their main residence address (up 13.5%), while another 1,993 were not (up 18.9%). Taking as a frame of reference the number of family dwellings in Spain during the third quarter (18,355,700), foreclosure proceedings were initiated over 0.0037% of them.
The real estate webpage, Pisos.com, has expressed its concern as in most of those cases the value of the property is lower than that of mortgage (i.e. having negative equity), which prevents it from being sold to pay off the debt, although it also points out that, though upturns are forecasted in the short run, particularly for housing bought before 2008, ‘’prospects are weakening” and figures will start declining in the medium term.
In terms of their condition, 16.4% were new homes and 83.6 % used ones, representing a decrease of 6.2% in the former and an increase of 16 % in the latter.
However, on a quarterly rate, these figures were lower 17.7 % and 30%, respectively.
19.2% of initiated foreclosures on homes corresponded to mortgages signed in 2007, while 17.2% – in 2006, and 12.5% – in 2005.
It was mortgages signed during the 2005-2008 period that mustered the highest number registered in a third quarter, amounting to 60.7%
From within urban properties, 3.6% more were evicted from other types of properties such as stores, garages, storage rooms, offices or warehouses, thus reaching 7,631 as well as 37.9% more from plots of land, more specifically, 1,033.
By autonomous regions, the highest number of mortgage proceedings were registered in Andalucia with 5,771; Catalonia with 4,066; and Comunidad Valenciana with 3,652; in contrast, the lowest were Navarra with 89; Cantabria with 151; and Asturias with 292. Andalucia was on the top of the list of evictions with 3,223, followed by Catalonia – 2,856, and Communidad Valencia – 2,241, while Navarra was the region which registered the fewest – 64, as well as Cantabria – 69, and the Basque Country – 84.
The INE highlights that 0.18% of all mortgages signed between 2003 and 2013 underwent foreclosure proceedings during the third quarter of 2014.
Original article: Cinco Días
Translation: Aura REE