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New mortgage contracts drop by 22% in Malaga province
Property

New mortgage contracts drop by 22% in Malaga province

The average loan signed in the province, at 193,470 euros, is the second most expensive in Spain, behind only the Balearic Islands

Cristina Vallejo

Malaga

Monday, 27 May 2024, 17:28

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A cooling of the property market, a reduction in the supply of available homes and the fact that Easter fell in March this year, unlike in 2023 when it was in April. These are all factors which experts have said explain a drop in activity in the property sector in Malaga province and in Spain as a whole.

It's backed up by data, where in the first quarter of 2024, 4,130 mortgages were signed in Malaga province, a 22% drop compared to the same period last year, when there were almost 5,300. This is a larger drop than that recorded in Spain, as usual: the just over 100,000 loans in the first three months of this year are 8.25% down on the 109,000 of last year.

In March, the number of loans taken out to finance housing was just 1,544 in Malaga, 25% lower than in the same month of 2023. In Spain, the 33,128 loans contracted were 18% down on the previous year.

A few days ago the National Statistics Institute (INE) reported that in the first quarter of the year there had been a total of 8,031 transactions in Malaga, a drop of almost 14% compared to the more than 9,300 registered in the same period last year. The decline was almost three times that recorded for the country: the 152,020 homes sold throughout Spain between January and March this year were 5.6% less than the just over 161,000 transactions in the first three months of 2023.

Specifically in the month of March the real estate market fell significantly - partly, as experts stated at the time, because Easter fell in that month; the number of real estate transactions in the province was 2,324, a figure that represents a 28% debacle compared to the same month a year earlier. In Spain, the decline was close to 22%.

Half of all sales are without a mortgage

In any case, these figures also reveal another phenomenon that is more accentuated in Malaga than in Spain as a whole. The proportion of homes that are bought without a mortgage is very high: practically half. In the country, meanwhile, the proportion of homes that are paid for with credit is around a third.

193,470 euros

This is the value of the average mortgage signed in Malaga in the first quarter, which represents a 14% increase compared to a year ago, when it was below 170,000 euros.

Be that as it may, there is a parallel decline in property transactions and mortgage signings. And this is not having any effect on prices: the figures released on Monday by the INE provide further evidence that this is the case at least in Malaga, because in other provinces something different is happening.

The average mortgage signed in Malaga province in the first quarter of this year was 193,470 euros. Not only is it the second most expensive in Spain behind only the Balearic Islands (just over 238,000 euros), but it is also 14.13% more expensive than a year ago, when it was just shy of 170,000 euros. Then, a year ago, the average mortgage signed in Malaga province was the fourth highest in the country, behind not only the Balearic Islands, but also Madrid and Barcelona. In fact, of these four provinces, Malaga is the exception, the only one where the average mortgage taken out has increased. In the archipelago the decrease is 7%; in the Spanish capital, 18% (a year ago it was over 210,000 euros and now it is around 172,000 euros); and in Barcelona, 1.7%, to 171,600 euros.

A closer look at the data shows Malaga is the fourth province in the country where the average mortgage has risen the most in the past year, behind only Avila, Huelva and Melilla, where the increase has not gone beyond 15%.

137,110 euros

is the average mortgage signed in Spain in 2024, 3.8% lower than a year ago.

Malaga is the eighth province in Spain in which the number of loans signed in the first three months of 2024 fell the most compared to a year earlier, the data shows. The average home-buying loan signed in Spain is around 137,000 euros, down 3.8% from just over 142,500 euros a year ago. Therefore, in some of the most expensive locations in Spain - which have been overtaken by Malaga - and in the country as a whole, the reduction in sales and mortgages is having an impact on prices.

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