• Fri. May 24th, 2024

Spain’s Mortgage Industry Struggles in January 2025 with Negative Rates, Highest Interest Rates Since December 2014

BySamantha Jones

Mar 27, 2024
Spain | Mortgage rates decrease by 10% at the start of the year, reaching nearly decade-high interest levels

In the first month of the year, Spain’s mortgage industry experienced a 10% drop compared to January 2024, with 33,128 loans granted. According to data from the National Institute of Statistics (INE), published this Tuesday. This marks the twelfth consecutive month of negative rates for home mortgages in Spain, though the decline is less pronounced than the previous month.

The focus is on average interest rates, which have been steadily increasing and are now at their highest level since December 2014 at 3.46%. The average amount of mortgages for homes decreased by 2.7% year-on-year in January, reaching €138,149 euros while capital lent decreased by 12.7% to €4,576.5 million euros.

The rise in interest rates can be attributed to the rate policy adopted by the European Central Bank (ECB) to combat inflation and Euribor’s evolution. The average interest rate for mortgages on homes was 3.46%, with an average term of 24 years. About 42% of mortgages in Spain were taken out at a variable rate in January, while 58.2% were fixed-rate mortgages.

In terms of inter-monthly rates, home mortgages increased by close to 33% from December 2024 to January 2025 while loaned capital increased by around 30%. According to the general secretary of the Association of Builders Promoters of Spain, there has been a trend towards moderation in mortgage financing due to rising financing costs.

The autonomous communities with the highest number of home mortgages in January were Madrid, Andalusia and Catalonia while fifteen regions saw fewer mortgages on homes than in the same period in 2023 with notable declines in Asturias and Navarra among others. However there were also increases seen in Madrid, Galicia and Aragón.

Furthermore, there was a decrease of almost six percent year-on-year

By Samantha Jones

As a dedicated content writer at newszxcv.com, I bring a passion for storytelling and a keen eye for detail to every piece I create. With a background in journalism and a love for crafting engaging narratives, I strive to deliver informative and captivating content that resonates with our readers. Whether I'm covering breaking news or delving into in-depth features, my goal is to inform, entertain, and inspire through the power of words. Join me on this journey as we explore the ever-evolving world of news together.

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