Increased Mortgage Lending Supports Spanish Property Market Recovery
21 January 2015 – Spanish News Today
Spanish banks regain confidence in real estate loans
One of the various encouraging aspects of the latest figures published by Spain’s notaries for November, in which further indications are shown that the country’s property market is at last achieving stability and even limited growth, is the increase in the extent to which residential property purchases are being financed by mortgage loans.
The notaries report that during November last year 13,857 residential property purchases were made with the aid of mortgages, 35% more than twelve months previously. At the same time, the average amount loaned by banks remained generally stable, falling by just 0.6% to €113,093 on property purchase mortgages (whilst the price of property itself fell by 1.5%).
In general terms, the notaries conclude that 40.6% of all residential property purchases last November were financed by means of a mortgage loan, the highest proportion in the first eleven months of 2014, and that in these cases the loans covered 74.9% of the total price.
It seems that as price stability becomes a reality it is not just purchasers who are becoming more confident about venturing into the market: banks also appear to be reaching the conclusion that the market is now solid enough for mortgages to represent an acceptable risk.
Original story: Spanish News Today
Translation: Carmel Drake