Homebuyers who need mortgages decreases

Since the first interest rate hike by the European Central Bank (ECB) in 2022, the number of buyers who have bought a home without a mortgage has risen by eight percentage points.

In 2022, 27 per cent of buyers did not apply for a mortgage, by 2023 this had increased to 32 per cent and so far in 2024 the trend has continued to grow to 35 per cent, according to the latest survey by Fotocasa Research, based on more than 8,200 interviews, conducted in February 2024.

After two years of tightening credit conditions, both house hunters and house seekers are now well aware of the current high mortgage rate environment. It is therefore not surprising that the impact on homebuying intentions has eased slightly, although it remains at significantly high levels.

Nearly a half of potential home buyers between the ages of 25 and 35 confess that the rise in mortgages has impacted their property purchase intentions. However, less than a quarter of those buyers over 55 stated that the rise in mortgages had any impact on their intention to buy.

Analaysis by real estate portal Idealista shows that foreigners represented only 5 per cent of the total mortgages granted in Spain in 2023. Finance for primary homes is the main requirement at over 70 per cent, while very few look for a mortgage for a second home. The British continue to lead the ranking of foreigners applying for mortgages, representing over 15 per cent of the total with Germany following closely.