Soaring Spanish mortgages shut out buyers: Costs jump 63% in a decade

Foreign demand drives up prices, leaving many residents facing impossible home loans and the realities of renting

If you’re thinking about buying a home in Spain, the numbers are increasingly daunting. The average mortgage amount needed to buy a property has surged by almost 63% in the last ten years; a rise that’s pushing many would-be homeowners towards renting instead. 

According to official figures, buyers in August 2015 needed just over €100,000 for their loan; by this August, that had jumped to nearly €170,000, with even sharper increases in places like Madrid and Andalucía, where the average has soared more than 70%.

Foreign demand is a major driver behind rising housing costs, with British, Moroccan, and German buyers accounting for nearly one in five home purchases nationwide this year. In popular areas like Madrid and the Costa del Sol, the average mortgage amount for buyers has nearly doubled, reaching €276,158 in the capital alone, while property prices per square metre have more than doubled over the last decade. 

Last year, over 71,000 homes were bought by international buyers, mostly from these countries, pushing prices higher and pricing out many local buyers in sought-after markets favoured by foreign residents and investors.

Many would-be buyers are now struggling to cross the “mortgage hurdle” and are forced to rent instead amid soaring house prices. The relentless climb is not limited to major cities. In Valencia, the average mortgage has increased by 74%, while the Balearic Islands have seen a 70% rise. Other regions, like Murcia and the Canaries, have also experienced sharp increases, though a little less drastic.

While the Spanish dream of home ownership remains strong, the reality for many is increasingly out of reach, replaced by growing frustrations and the tough choice between rental and the oversized mortgages needed to buy.

Image: moerschy/Pixabay 
 

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The Art of Living in Spain has been making Spanish property dreams come true for over 20 years

Founded in 2001, The Art Of Living In Spain (TAOLIS) stands as a visionary concept creator, specialising in property development and construction within the vibrant Region of Murcia.

 

Nestled within the prestigious Altaona Sports & Wellness Resort, our headquarters comprises a dynamic team of 60 international professionals from diverse backgrounds, that infuse each project with a distinctive blend of expertise and innovation.

 

Spearheaded by our esteemed Dutch management team, they have overseen a multitude of design and construction ventures, ranging from residential developments to comprehensive renovation projects. With over two decades of exemplary service, TAOLIS has garnered a sterling reputation for delivering unparalleled quality to both private individuals and corporate entities.

 

Our track record speaks volumes, with countless satisfied clients benefiting from our unwavering commitment to excellence. Building upon our legacy of success, we are honoured to embark on our latest endeavour: the development, construction, marketing, and sale of a wide variety of projects and facilities over the next few years within the esteemed Altaona resort, that already comprises of approximately 600 properties. In the coming years, TAOLIS will continue to shape the landscape of Altaona with its innovative concept of a Bluezone-inspired Sports and Wellness Resort, focused on Longevity.

 

Whether you are in need of designs, construction, refurbishment or anything else for your real estate clients, get in touch with TAOLIS to see how they can help you achieve your property goals.