Mortgage signing plummets in the Canary Islands

The number of mortgages on homes registered in property registries decreased last June in the Canary Islands by 26.2% compared to the same month in 2023, which represents the largest drop of all the autonomous communities.

There were also pronounced decreases in the Basque Country (23.3%) and the Balearic Islands (22.7%), according to the National Institute of Statistics (INE).

In contrast, the highest positive year-on-year variation rates in terms of the number of mortgages on homes in June were recorded in Asturias (6.8%), Navarra (5.2%) and Catalonia (2.3%).

Across Spain, the signing of mortgages has decreased in 14 of the last 16 months after the June data: 5.5% less in year-on-year rate.

The indicator has moderated its fall, although it has chained two months of decreases (18.2% less in May), after a June in which 31,526 contracts were signed (33,478 signatures in June 2023).

In the first semester, the signing of mortgages on homes increased in year-on-year rate only in April due to a seasonal issue (28% more) and 3.8% in February.

In June, the average amount was 146,177 euros, 1.9% more, while the average interest rate on new mortgages on homes was 3.26%.

Precisely, the Euribor at twelve months, the most used indicator in Spain to calculate variable mortgages, will close August downwards, with an average rate of around 3.17%, its fifth consecutive fall and its lowest level since December 2022.

This new decline in the Euribor may begin to be noticed for the next analyses. Meanwhile, fixed mortgages on homes continue to gain ground over mixed mortgages.

In fact, in the sixth month of the year, 42.6% of them were constituted at a variable rate and 57.4% at a fixed rate. In addition, the average interest rate at the beginning was 3.06% for mortgages on homes at a variable rate and 3.44% for those at a fixed rate.

Novations on mortgages (modifications with the same financial entity) increased by 11.9% in June in year-on-year rate, while subrogations to the debtor (the holder changes) decreased by 75.9% and subrogations to the creditor (entity changes), by 81.1%.