Official figures from the INE on Spanish Mortgages

Levels of new loans granted

the level of mortgages granted in Spain in December 2013 as expected were down for the year on a month by month basis and a total year.

Number of new loans  secured against dwellings fell to 12,329 in December down some 30.1% from the same month of the previuos year.

Whilst siginificantly down on last year December 2012 was a better month for completed new loans skewed by buyers buying in Spain to beat the removal of tax breaks that were withdrawn at the end of 2012.

Average loan sizes also dropped in December to € 101.494

Regional variations

Coastal areas held up better in 2013 than the City areas which is possibly a reflection of who is buying in Spain. Non resident mortgage applications toward the back end of 2013 were higher than the start of year.

In the more resident areas like Madrid new loans garnted fell by more than 50% in the month of December.

Average Interest rates and term

The average interest rate for new loans constituted in December was 4.32% which was around 3.78% above the 12 month Euribor.

The average term over which new loans were granted in December was 20 years.

2013 Full year figures

Spanish Mortgage numbers decreased by 27.8% for the whole year. Given each year for the last 5 years the number of new loans granted have decreased significantly hitting overall decreases each year of 20% or more the levelof lending in Spain is now significantly lower than at their peak and well below historic norms.

The level of mortgages being closed within the month topped the 20,000 level in December meaning we had another consecutive month of a net outflow of mortgage balances from the Spanish Banks books. Not split out is how many of these redeemed mortgages related to Banks taking over the property and how closed due to the loan being paid off in full.

2014 what to expect

2014 should show an improvement in overall levels of mortgages granted. For the first time in many years the Banks have lending targets and we are already seeing a small but not insignificant price war happening where the client wants lower loan to values and has low debt to income ratios.

Read the full article: Loans in Spain official figures for December