Average mortgage value increased in April

INEThe average value of new mortgages stood at 114,340 euros in April, a 0.7% increase on the interannual rate.

This is according to mortgage statistics for April 2012 released by the National Institute of Statistics (INE).

Mortgage Statistics – April 2012

During the month of April, the average amount of mortgage constitutions recorded in the land registries stood at 114,340 euros, a figure 0.7% higher than the same month the previous year and 1.5% higher than that recorded in March 2012.

In the case of mortgages constituted for dwellings, the average amount was 99,662 euros, 7.1% less than in April 2011, and 4.0% less than that registered in March 2012.

The value of the mortgages constituted on urban properties was 3,760 million euros in April, indicating an interannual decrease of 28.8%. In dwellings, the capital loaned exceeded 2,142 million euros, 36.1% less.

Mortgages by institution

Banks were the institutions that granted the largest number of mortgage loans in April (71.6% of the total), followed by Savings Banks (11.6%) and Other financial institutions (16.8%).

Regarding the capital loaned, Banks granted 72.6% of the total, Savings Banks 11.8%, and Other financial institutions 15.6%.

Mortgage interest rates

The average interest rate in April 2012 was 4.38%, indicating a 8.4% increase in the interannual rate, and 0.2% as compared with March 2012.

By institution, the average interest rate of Savings Bank mortgage loans was 4.53%, and the average term was 23 years. Regarding Banks, the average interest rate for mortgage loans was 4.54%, and the average term was 23 years.

92.8% of the mortgages constituted in April used a variable interest rate, as opposed to the 7.2% that used a fixed rate. Within the variables, the Euribor was the reference interest rate most used in constituting mortgages, specifically in 84.6% of new contracts.

Mortgages with registration changes

In April, the total number of mortgages with changes in their conditions recorded in the land registries stood at 26,494, with an interannual increase of 16.4%. For housing, the number of mortgages with modified conditions increased 17.0%.

Considering the type of modification of the conditions, in April 21,417 novations (or modifications produced within the same financial institution) were produced, for an interannual increase of 14.0%. The number of transactions that changed institutions (subrogations creditor) was 3,387, that is 22.8% more. In turn, 1,690 mortgages changed the holder of the mortgaged property (subrogations debtor), which implied an increase of 39.6%.

Number of mortgages with changes in interest rate conditions

Of the 26,494 mortgages with changes in their conditions recorded in the land registries in April, 36.4% were due to changes in interest rates.

The percentage of mortgages at a fixed interest rate decreased after the change in conditions (from 4.6% to 3.2% 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 Active Reference Rate of Savings Banks.

After the modification of conditions, the average interest of the loans increased 0.91 points in fixed interest rate mortgages, and decreased 0.26 points in variable interest rate mortgages.

You can see the full report here: Mortgage Statistics – April 2012

Mortgage borrowing falls in April

Fewer mortgages granted in April
Fewer mortgages granted in April

Following falling property sales the number of new mortgages approved in April fell by 7.5% compared to the same month in 2011.

A total of 977.061 million euros of new mortgage loans were approved compared to 1.056.325 million euros in April of the previous year.

The Spanish Mortgage Association released the figures which confirm April as a slow month with property transfers also falling 5.7%.

The month closed with the total mortgage balance down on the previous month by 8.780 million euros, 20.000 million euros less than in February. The year-on-year balance dropped by 73.264 million euros, putting the total balance at 966.514 million euros which  includes a figure of 176.058 million euros in securitised mortgage assets.

Banks and savings banks accounted for 887.416 million euros of the total while credit unions recorded 65.409 million euros representing a 4.95% fall for them. However, it wasn’t bad news for all with credit institutions accounting for 13.689 million euros representing a massive year-on-year growth of 35%.

The figures show with some clarity the continued slowdown of the country’s real-estate sector which has been suffering since the property bubble burst in 2007, when property prices were at their peak and property sales figures also hit record levels.

You can see the report here: Mortgage Credit Activity April 2012

Property transfers down 5.7% in April

INEAccording to figures released by the National Institute of Statistics (INE)  the number of property transfers in April decreased 5.7%, as compared with the same month the previous year.

The number of property transfers recorded in the land registries, from public deeds previously registered, was 117,018 in April, that is, 5.7% less than for the same month in 2011, and 20.0% lower than in March 2012.

In the case of registered merchantings of property, the number of transfers was 48,824, representing an interannual decrease of 7.0%, and a decrease of 16.6%, as compared with the previous month.

Merchantings recorded in the land registries

83.3% of the registered merchantings corresponded to urban properties and 16.7% to rustic properties. Among the urban properties, 53.0% were merchantings of dwellings.

The number of merchantings of rustic properties increased 5.3% in the interannual rate in April, while that of urban properties decreased 9.1%. Within the latter, merchantings of dwellings decreased 9.9%.

Registered merchantings of dwellings, by protection system and status 

88.8% of transfers of dwellings by merchanting in April were free housing, and 11.2% were protected housing. In interannual terms, the number of transfers of free dwellings by merchanting decreased 8.2% and that of protected dwellings decreased 21.1%.

46.5% of the dwellings transferred by merchanting in April were new, and 53.5% were used. The number of transactions on new dwellings decreased 11.6%, and the number of used dwellings decreased 8.3%, as compared with April 2011.

Geographical distribution

In April 2012, the total number of property transfers recorded in the land registries per 100,000 inhabitants¹ was highest in the Autonomous Communities of Castilla y Leon (541) and Castilla-La Mancha (519).

The Autonomous Communities showing the highest number of registered merchantings of property per 100,000 inhabitants¹ were Castilla-La Mancha (197) and Castilla y Leon (182).

By registered merchantings of dwellings, the Autonomous Communities in which the number of transfers per 100,000 inhabitants¹ was highest were Comunitat Valenciana (81) and Castilla-La Mancha (70).

60.7% of merchantings of dwellings in April 2012 were recorded in four Autonomous Communities: Andalucía, Comunitat Valenciana, Cataluña and Comunidad de Madrid.

You can download the full report here: Statistics on Transfer or Property Rights – April 2012

¹ This data was calculated from the revision of the figures of the Municipal Register for the year 2011. Only the population aged 18 to 84 years old was considered.

Retail sales in record fall

Retail sales fell 9.8% in April
Empty shopping malls tell a story

Figures released today by the National Statistics Institute (INE) show retail sales in Spain fell by 9.8% in April, compared to the same period in 2011, showing the biggest fall since the figures started being collected in 2003.

Summary of results

  • The General Retail Trade Index at constant prices showed an interannual variation of -11.3% in April, more than seven points below that registered in March.
  • The average rate of retail sector sales stood at –5.9% during the first quarter of the year,as compared with the same period of 2011.
  • All Large chain stores experienced a decrease in sales, as compared with the same month of 2011.
  • Employment in the retail sector decreased 0.9% as compared with April 2011.
  • All Autonomous Communities showed negative interannual variations in their retail sales.
  • Employment decreased in all autonomous communities, except in La Rioja.

Evolution of trade, in general and by type of product

Sales in retail trade at constant prices (that is, after eliminating the prices effect) registered an interannual variation of -11.3% in April, indicating a decrease of 7.3 points, as compared with the rate from March.

Sales, excluding service stations, presented an annual rate of -11.1%. The breakdown of these sales by type of product showed a negative rate in food products (-6.7%) and non-food products (-14.7). Among the latter, Household equipment (–20.2%) registered the greatest decrease.

In turn, sales in service stations, after adjusting the prices effect, decreased 11.3%, as compared with April 2011.

The average rate of the General Retail Trade Index during the first quarter of the year presented a –5.9% variation as compared with the same period last year. By type of product this rate was negative in food products and in non-food products.

Evolution of trade, adjusted for the calendar effect

After adjusting the calendar effect, that is, the difference between the number of working days in a given month in different years, the Retail Trade Index registered an interannual rate of –9.8% in April, six points below that registered in March.

Evolution of employment, by distribution class

The employment index in the Retail Trade sector in April showed an annual rate of –1.2%, two tenths below that registered in March. Employment decreased 0.2% in Service stations.

By distribution class, only Large chain stores registered a positive interannual rate, 0.4%.

In the retail sector as a whole, average employment registered a rate of −1.1% in the first quarter of the year, as compared with the same period the previous year.

Results by Autonomous Community. Variation rates in sales 

Retail sales decreased in the interannual rate in all Autonomous Communities in April. The greatest decrease was registered in Castilla-La Mancha (−14.6%).

Extremadura (−8.3%), Canarias (-8.7) and Illes Balears (−8.8%) showed the lowest decreases.

You can download the complete report here: Retail Trade Indices – April 2012

Tourism down in April but up for the year

Frontur tourism
Spain saw 4.5 million tourists in April

According to the latest report from Frontur, Spain received 4.5 million tourists in April, 1.7% fewer than the same month in 2011.

Despite the fall in April the first four months of 2012 saw 13.7 million visitors visit Spain, representing a 1.1% annual increase.

Of the total tourists in April over 3.5 million of them arrived by air and three million stayed in hotels.

The majority of tourists were from Britain and the Nordic regions, whilst the number of French and German tourists also increased. However, the number of Britons arriving fell following two months of increases.

Just over one million tourists were British, yet this was 13% fewer than in the same month last year, showing that Brits are sacrificing their foreign holidays in favour of cheaper English holidays which are being heavily promoted on English television.

By region  Catalonia and Madrid were the only ones to see an increase. All other regions registered a fall in tourist numbers with the largest fall being in Valencia which saw 17.6% fewer tourists.

The number of package holidays also declined in April recording a fall of -1.9%.

The figures are similar to those of April 2009. The figures for 2010 and 2011 were unreliable as they were distorted by a few factors. In 2010 huge numbers of flights were cancelled across Europe due to the Icelandic volcano, and in 2011 the so-called “Arab Spring” saw many people choosing Spain over Turkey and Egypt.

You can see Frotur’s full report here: Nota de coyuntura de Frontur. Abril 2012.

Hotel occupancy down in April

INENew figures released today by the National Institute of Statistics (INE) show that hotel occupancy was down in April by 4.8% compared to the same month in 2011.

Hotel Tourism Short-Term Trends – April 2012

During the month of April, 21.5 million overnight stays were recorded in hotel establishments, indicating a 4.8% decreases as compared with the same month in 2011. This decrease in overnight stays took place for both residents, whose interannual rate stood at –5.0%, and non-residents, with an interannual variation of –4.6%.

The average stay decreased 0.9% as compared with April 2011, standing at 3.0 nights per guest.

During the first quarter of the year, overnight decreased 2.1% as compared with the same period in 2011.

In turn, the Hotel Price Index (HPI) registered a 0.1% decrease in April. Regarding the indicators on the profitability of the hotel sector, invoicing per occupied room reached an average value of 68.1 euros, and income per available room stood at 36.8 euros.

In terms of occupancy, 49.9% of the available bedplaces were filled in April, indicating a 5.6% decrease as compared with the same month the previous year. The weekend occupancy rate by bedplaces stood at 56.3%, with a decrease of 2.4%.

Overnight stays of guests resident abroad

Guests from Germany and the United Kingdom registered rates of 24.6% and 20.8%, respectively, of the total overnight stays by foreign nationals in April. Both markets experienced a 9.3% and 6.8% interannual decrease in overnight stays, respectively.

Overnight stays of guests from France, Italy and Netherlands (the following countries of origin) registered interannual rates of 8.8 %, –9.3% and 12.5%, respectively.

Main destinations

The main destination chosen by non-residents was Canarias. In this Autonomous Community, overnight stays by foreign nationals decreased 10.1% as compared with April 2011. It was followed by Cataluña, with an interannual rate of 2.5%, and Illes Balears, with a decrease of 3.8%.

Andalucía, Cataluña and Comunitat Valenciana were the main destinations of guests resident in Spain, with interannual rates for overnight stays of –3.0%, –4.2% and –0.3%, respectively.

Results by Autonomous Community, tourist area and tourist site

During the month of April, Canarias was the Autonomous Community with the highest occupancy rate by bedplaces (63.7%), followed by Illes Balears (59.0%) and Comunidad de Madrid (55.5%).

The tourist areas with the highest occupancy and overnight stay rates were located on the islands and the coasts. The zone of Barcelona recorded the highest occupancy rate by bedplaces (74.7%) and the highest weekend occupancy rate by bedplaces (78.7%). Mallorca registered more than 2.2 million overnight stays in April.

The tourist sites with the highest number of overnight stays were Barcelona, Madrid and Benidorm. Barcelona reached the highest occupancy rate by bedplaces (75.1%) and Benidorm the highest weekend occupancy (85.0%).

Evolution of the Hotel Price Index

The interannual rate of the HPI stood at –0.1% in April, this rate being 0.2 points higher than that obtained last month, and 0.3 points that registered one year ago.

HPI by Autonomous Community

The four Communities (Canarias, Cataluña, Andalucía and Comunidad de Madrid) that carried 67.9% of the total weight of the HPI in the month of April, showed uneven behaviour.

Canarias, which carried the greatest load in the weighting structure this month, presented an interannual rate of 0.2%, that is, 3.0 points lower than that estimated in March. Hotel prices experienced an increase of 3.7% in Cataluña, as compared with 0.4% of the previous month.

In Andalucía, the interannual variation was 0.1%, as compared with the –2.5% observed last month. Comunidad de Madrid presented an interannual variation of –3.9%, that is, 0.6 points less than March.

HPI by category

Hotel prices increased in five-gold-star hotels (1.0%), in three-gold-star hotels (0.2%) and in one-gold-star hotels (0.1%) in April.

All other category presented a decrease in the interannual rate: three and two-silver-star hotels (–2.2%), two-gold-star (–1.1%), one-silver-star (–0.7%), and four-gold-star hotels (–0.2%).

Indicators on the Profitability of the Hotel Sector

The average invoicing by hotels per occupied room (ADR) in April was 68.1 euros, indicating a decrease of 1.1 euros as compared with the same month in 2011.

In turn, income per available room (RevPAR), conditioned by the occupancy registered in the hotel establishments, reached 36.8 euros, with a decrease of one euro as compared with April 2011.

By category, the average invoicing was 152.3 euros for five-star hotels, 73.3 euros for fourstar hotels and 53.3 euros for three-star hotels. Income per available room for these same categories was 88.2, 46.4 and 31.2 euros, respectively.

You can download the full press release here: Hotel Tourism Short-Term Trends – April 2012

Rental costs increased in April

According to figures from the National Statistics Institute, the cost of renting a property in Spain increased by 0.7% in April, compared to the same month in 2011. However, there was no change compared to the previous month.

The increase was 1.4 points below the overall CPI which stood at 2.1% in April.

There were only two regions where rental prices decreased. They were Murcia and La Rioja where rental costs decreased by 1.2% and 0.3% respectively.

The region that saw the greatest increase was Catalonia where an increase of 1.4% was recorded. The Basque Country and Asturias followed, both recording an increase of 1.2%.

Andalucia saw an increase of 0.8% while Melilla and Ceuta (Spanish territories in North Africa) both registered a 0.7% increase. Madrid saw a small increase in rental costs of 0.2%.

By province Alicante saw a fall in rental costs with a -1.1% change. The largest increase by province was seen in Palencia with 1.7%, while León, Granada and Barcelona all registered an increase of 1.6%.

Consumer confidence down in April

Consumer confidence is down
Consumer confidence is down

A survey carried out by the Centre for Sociological Research (CIS) shows that consumer confidence in Spain fell by 13.4 points in April, compared to the previous month. It is one of the worst drops in confidence since records began in 2004.

Despite low confidence, 2.8% of survey respondents said they intend to purchase a property in 2013, while 96.6% said they would not be buying a home next year, leaving 0.6% undecided.

However, 43.2% of respondents believe house prices will continue to fall this year, and into 2013. A further 45.6% believe that prices will remain the same, while 5.3% think prices will begin to rise.

Of those that took part in the survey 79.2% think the current situation in Spain is worse than it was six months ago, while 3% think it has improved, reported Idealista.com.

With unemployment currently at 24.4%, the highest in Europe, 55.4% of those surveyed think that there will be fewer jobs available six months from now, echoing prime minister Mariano Rajoy’s prediction that unemployment would increase further this year.

House prices continue to fall in April

TINSA have released their IMIE index for April showing a decline in house prices of 12.5%. The cumulative decline since the peak in December 2007 increased to 29.8%.

Tinsa IMIE April 2012
Tinsa IMIE April 2011 v April 2012

In terms of the different segments, the municipalities of the Mediterranean Coast once again recorded the sharpest year-on-year decline during April with a fall of 14.3%, closely followed by Capitals and Major Cities which fell by 13.7% compared to the same month last year. In both cases the decline was higher than the market average.

Below the market average were the Balearic and Canary Islands which fell by 12.3% yearon-year, followed by Metropolitan Areas with 12%; while the lowest declines were recorded by Other Municipalities, defined as those not included in the other segments, which recorded a fall of 10.6%.

In terms of cumulative declines from the top of the market by segment, the Mediterranean Coast was down by a total of 37% in April; followed by Capitals and Major Cities with 32.8%, Metropolitan Areas with 30.7%, Balearic and Canary Islands with 26.9% and lastly Other Municipalities with 24.2%.

About the IMIE – Spanish Property Market Index

The IMIE Index, a pioneering initiative launched by Tinsa in 2008, consists of an index that reflects the value of residential property in Spain. It is governed by market criteria in terms of its geographical segmentation. Based on these guidelines, Tinsa has subdivided Spain into five major categories that represent the segments of the residential property market: Capitals and Major Cities with a population of 50,000 or more, Metropolitan Areas, the Mediterranean Coast, the Balearic and Canary Islands and Other Municipalities.

The IMIE Index records the variation in the m2 value of a property, calculated using the information from more than 200,000 residential valuations carried out by Tinsa every year, based on the methodology similar to that used for calculating the CPI and other international monthly price indices.

About Tinsa

Tinsa is a leading multinational for property valuation, analysis and advice. Founded in 1985, the company has 32 regional offices in Spain as well as permanent offices in France, Portugal, Argentina, Chile, Peru and Mexico, although it operates in more than 25 countries. Since November 2010 Tinsa has been owned by Advent International.

Tinsa’s range of services includes real estate analysis and valuation, consultancy, and valuation of other types of tangible and intangible assets, among others. For more information please visit www.tinsa.es.

Unemployment fell in April

The number of jobless in Spain fell in April for the first time in nine months, according to figures released today by the Labour Ministry.

The number of people registering for unemployment benefit fell by 6,632 to 4.74 million. This follows an increase of 38,769 in the previous month.

However, these figures are some way off those provided by the National Statistics Institute last month. Their report put the number of unemployed at 5,639,500, almost a million more than today’s figure.

Many are putting the decline down to the Easter holiday which traditionally attracts thousands of tourists to join in the carnival. This creates extra business for local traders and this creates a need for temporary staff. Also, the summer season is upon us and many temporary jobs are being filled, removing people from the jobless statistics.

However, those temporary jobs are often paid in cash while the employee remains registered as unemployed creating misleading figures.

It’s nice to see some good news about Spain but I will wait to see what the National Statistics Institute has to say in their next report before I get too excited. Their numbers are more widely recognised as accurate and analysts watch them closely.