The latest Spanish mortgage and Euribor news
Euribor (12 months), the interest rate most often used to calculate mortgage repayments in Spain, fell to 1.219 in June, just a fraction above the all-time low of 1.215 it reached March 2010.
Euribor has plunged over the last year, going from an annual increase of +67pc a year ago, to an annual decline of -43pc now, as illustrated by the following chart.
As a result, repayments on a typical 25-year, €150,000-mortgage resetting now will go down by around €790/year.
Cheaper mortgage rates only apply to those who already have a mortgage. Those that don’t either can’t get one (unless buying a bank repo) or have to pay much higher rates.
The following chart shows how Euribor has changed over 10 years.
New mortgage lending plunges…..again
I’ve lost count of the number of consecutive months that new mortgage approval have fallen but I think it’s been going on for at least a year. It fell another 31.3pc in April (to 21,498), with the average new mortgage now coming in at just €99,662, down 7.1pc in a year (all figures from the INE). Few, smaller mortgages means less money chasing homes, which means downward pressure on Spanish house prices.
New mortgage lending has collapsed more than 80pc since the boom.