The last 12 Months
2016 has seen a number of changes in the Spanish mortgage market. Outside pressures like Brexit have affected the buying and mortgage application market with UK buyers being the largest population of non residents in Spain.
FX rate fluctuations
Foreign exchange rate fluctuations have been vast during the year rising as high as 1.42 and dropping within weeks to 1.10. For those buyers outside the Euro this has a massive affect on the price being paid and has pushed some cash buyers towards taking lending in Spain until the pound recovers.
Fixed rates
The biggest change in the loan arena in Spain is the rise of fixed rates. From almost a total variable rate market fixed rates now make up over 20% of all loan completions each month.
Spanish Banks now hold a range of full term fixed products ranging from 5 years to 30 years.
Risk
The Bank of Spain has sought during the year to keep lending under control and the Risk teams within the Spanish Banks have not thrown caution to the wind. The outcome is another year of net losses to the mortgage book and a year of missed targets.
Compulsory products the surge of Spanish lending remains a key issue for mortgage applicants but very competitive fixed rates have helped overcome this.
Read the full article :- 2016 Spanish loan overview
