Home Mortgages Fell by 43% in July

September 30th, 2013

The number of new mortgages constituted for the purchase of a home fell by 42.7% in July, compared with the same month of the previous year, reaching a total of 13,777 transactions. This figure represents a record low in the historical series (which began in 2003), and has now accumulated 39 consecutive months of contraction.

According to the latest data released by the National Statistics Institute, the average value of a mortgage for a home purchase increased slightly in July, once again exceeding 100,000 euros (100,180 euros), which is 0.8% more than a year earlier. However, the total capital loaned for the purchase of housing, fell in July to 1,380 million euros, which is 42.2% less than the previous year but virtually the same as in June, which was 0.7% less.

The signing of new mortgages increased their rate of decline in July, from the 42.2% recorded in June, after dropping to 29% in May, 19% in April and 34% in March.

The average interest rate financial institutions applied to mortgage loans was 4.40% in July, 3.8% more than a year earlier. The majority of the Spanish opted for variable rate mortgages (91.2%), with the Euribor remaining the reference most widely used (in 84.2% of new contracts).

The regions where most new home mortgages were constituted in July were Catalonia (2,394), Andalusia (2,306) and Madrid (2,115). Although all regions registered declines in the number of new mortgages constituted, Castilla y Leon registered the lowest decrease, with -23.7%.

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