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Spain's Mortgage Market Heats Up

Spanish mortgage demand is rising, prompting banks to compete, while the Bank of Spain monitors risks to financial stability.

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Spanish

Spain

EconomyLabour MarketRegulationReal EstateBankingMortgages

Banco De EspañaEuropean Central Bank (Ecb)Consejo General Del Notariado

Ángel Estrada

What is the current state of the mortgage market in Spain?: The demand for mortgages in Spain has increased, leading banks to adjust prices and conditions to attract buyers. The Bank of Spain is closely monitoring this to ensure financial stability and prevent excessive risk-taking.
What are the latest figures on mortgage loan growth in Spain?: In September 2023, mortgage loans for home purchases in Spain grew by 26% year-on-year, reaching 25,794 operations. The average amount of these loans increased by 4.6%, reaching 154,264 euros.
What factors are contributing to the increased demand for mortgages in Spain?: The increase in mortgage applications is linked to the European Central Bank's (ECB) monetary policy change and the decrease in the Euribor. The number of property sales also saw a recovery in September, increasing by 12.5% compared to September 2022.
What factors is the Bank of Spain closely monitoring to ensure financial stability?: The Bank of Spain is closely monitoring several factors, including the maturity of mortgages, the spread between mortgage credits and benchmark rates, and the evolution of real estate prices. They are concerned about potential risks associated with increased competition in the mortgage market.
What is the average loan-to-value ratio for mortgages in Spain, and what is the maximum recommended ratio?: The average loan-to-value ratio for mortgages in Spain is currently around 65%, slightly up from previous quarters. The Bank of Spain sets a maximum recommended ratio of 80%, and the number exceeding that is currently low, but they remain vigilant.

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