Mortgages in Spain fall by 40 percent in 2008

New mortgages conceded by banks and building societies fell by 40% in 2008 compared to 2007. According to figures released by the Bank of Spain and published in this El Mundo article, in 2008 87,074 million euros were conceded in mortgage lending compared to 145,298 million euros in 2007 and 170,297 million euros for 2006.

The economic crisis meant that banks and building societies conceded fewer credits in 2008 although the overall amount of mortgage lending continued to grow. In 2008 mortgage lending by banks and building societies closed at 644,656 million euros which is just 4.4% more than in 2007 when mortgage lending grew by 13% and a growth of 22% for 2006.

December was the 26th month in which the amount of new mortgages registered an interannual fall – a tendency which began in September 2006 when mortgage lending fell by 4.63%.

Out of all the new loans conceded in 2008 5,648 million euros were lent in December which is 42% less than in December 2007.

February and April were the best months for mortgage lending in 2008 when banks and building societies lent 9,845 and 9,158 million euros respectively.

According to the banking sector mortgage lending will continue to decrease not only due to growing unemployment and the economic situation but also because of the lack of solvent applicants.

Related: Mortgages in Spain ## Mortgages for non-residents in Spain