New Mortgages Up By 7 Percent in June
The number of new mortgages signed in June rose by 7.2% compared to May, suggesting that the mortgage market may be starting to recover from the credit crunch. Optimists argue this will breathe life back into the property market.
On a year on year basis, however, new mortgages signed in June were still 10.8% below the same month last year, showing that the market still has some way to go before it recovers to former levels.
These figures, from Spainâ€™s National Institute of Statistics, also reveal that accumulated new mortgage signings were down 31% in the first 6 months of the year compared to the same period last year.
By value, new mortgages in June fell 6% year on year, but rose 4% month on month.
The average value fell 10% year on year to 142,700 Euros, but was up 5% on the previous month. In some regions, especially those where property prices are highest, the fall was more drastic. Average mortgage values fell 19% in Madrid, and 25% in Barcelona.
Average mortgage values are also down heavily in popular holiday home destinations like Malaga (Costa del Sol), down 24.5%, and The Balearics, down 30%.
The average interest rate was 4.47%, 13.8% lower than a year ago and 2.9% lower than the previous month. This figure shows that banks are passing on only a fraction of the fall in base rates to customers. Base rates are down 70% compared to June last year.
The average monthly mortgage payment has fallen from 845 Euros in June 2008, to 702 Euros today.
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