12-month Euribor, the base rate used for most mortgages in Spain, came in at -0.19 in April, a fraction higher than the month before, but 59.7% lower than the same month last year, which is what counts when it comes to annually resetting mortgages.

As a result, borrowers in Spain with annually resetting Spanish mortgages will see their mortgage payments fall by around €3.6 per month for a typical €120,000 loan with a 20 year term.

Euribor’s downward trend deep into negative territory looks like it has run its course, as you can see from the chart above. Having fallen every month between September 2016 and December 2017 Euribor has remained unchanged or risen in three of the last four months.

Financial analysts quoted in the Spanish press report that traders do not expect Euribor to fall much further, if at all. Monetary sanity has to return to the Eurozone at some point, and that day now looks a bit closer.

Once again you can see below the ten year chart illustrating how interest rates in the Eurozone have fallen to historic lows, and money has never been this cheap. It looks like a good time to take out a long-term, fixed-interest rate mortgage as money might never be this cheap again in our lifetimes. If interest rates, inflation, and Spanish property prices rise (as they are), buying a Spanish home today with a fixed-rate mortgage could turn out to be an excellent investment, especially considering how pricey all other assets around the world appear to be.

New mortgage lending up 13.8% in February

New residential mortgage lending continues to rise rapidly in Spain, up 13% in February, according to the latest figures from the Association of Spanish Notaries. The average new loan in February was €129,922, up 0.1% compared to last year. This sustained rise in mortgage lending is a result of the improving economy, rising house prices, abundant liquidity in the system, and rising confidence in Spain.