Average mortgage value down 7.2% in May

Average mortgage value down 7.2%
Average mortgage value down 7.2%

The National Institute of Statistics has released figures showing a fall of 7.2% in the average value of mortgages constituted in May, compared to the same time in 2011.

The average mortgage value in May was 112,320€, a figure 7.2% lower than the same month the previous year and 1.8% lower than that recorded in April 2012.

In the case of mortgages constituted for dwellings, the average amount was 101,168 euros, 7.5% less than in May 2011, and 1.5% higher than that registered in April 2012.

The value of the mortgages constituted on urban properties was 4,550 million euros in May, indicating an interannual decrease of 33.5%. In dwellings, the capital loaned exceeded 2,631 million euros, 35.8% less.

Mortgages by institution

Banks were the institutions that granted the largest number of mortgage loans in May (73.8% of the total), followed by Savings Banks (10.2%) and Other financial institutions (16.0%).

Regarding the capital loaned, Banks granted 71.5% of the total, Savings Banks 10.8%, and Other financial institutions 17.7%.

Mortgage interest rates

The average interest rate in May 2012 was 4.32%, indicating a 5.9% increase in the interannual rate, and a 1.4% decrease as compared with April 2012.

By institution, the average interest rate of Savings Bank mortgage loans was 4.36%, and the average term was 23 years. Regarding Banks, the average interest rate for mortgage loans was 4.47%, and the average term was 20 years.

94.4% of the mortgages constituted in May used a variable interest rate, as opposed to the 5.6% that used a fixed rate. Within the variables, the Euribor was the reference interest rate most used in constituting mortgages, specifically in 85.3% of new contracts.

Mortgages with registration changes

In May, the total number of mortgages with changes in their conditions recorded in the land registries stood at 32,819, with an interannual increase of 5.8%. For housing, the number of mortgages with modified conditions increased 7.8%.

Considering the type of modification of the conditions, in May 28,158 novations (or modifications produced within the same financial institution) were produced, for an interannual increase of 8.0%. The number of transactions that changed institutions (subrogations creditor) was 3,331, that is 4.1% less, as compared with May 2011. In turn, 1,330 mortgages changed the holder of the mortgaged property (subrogations debtor), which implied an interannual decrease of 10.6%.

Number of mortgages with changes in interest rate conditions

Of the 32,819 mortgages with changes in their conditions recorded in the land registries in May, 37.3% were due to changes in interest rates.

The percentage of mortgages at a fixed interest rate decreased after the change in conditions (from 3.3% to 2.3% of the total), since most of these loans were referenced to a variable interest rate. Within the interest rate structure, the Euribor was the main reference. The lowest average interest before and after the change was that corresponding to Other interest rates.

After the modification of conditions, the average interest of the loans increased 1.09 points in fixed interest rate mortgages, and decreased 0.16 points in variable interest rate mortgages.

Registered mortgage cancellations

In May, 39,788 mortgage cancellations were registered, 9.1% less than in the same month of 2011. Mortgages cancelled on rustic properties decreased 11.5%, whilst those cancelled on urban properties decreased 9.0%. Cancellations of mortgages on dwellings decreased 10.1% in the interannual rate.

Download complete report from INE: Mortgage Statistics – May 2012

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