Mortgages surge ahead of cash purchases as home loans in Malaga reach highest level since 2020

Between January and August, 23,047 homes were purchased in Malaga, representing a 4.77 per cent decrease compared with the same period last year. During the same eight months, the number of mortgages taken out in Malaga province totalled 16,363, representing a 14.3 per cent increase compared with those recorded in the previous year.

In short, fewer property sales were recorded, but more bank loans were granted to finance homes. These figures show that 71 per cent of property sales in Malaga so far in 2026 have been financed by mortgages.

This trend has been observed over recent months, with cash payments gradually giving way to bank financing - a shift that is becoming increasingly established as the end of the financial year approaches.

In recent years, cash payments and bank loans were split almost equally at 50 per cent, although by 2025 cash payments had already taken a small step back: last year, 63 per cent of transactions were paid for with a mortgage (and 37 per cent in cash). In 2024 and 2025, bank financing accounted for 57 per cent of transactions (compared with 43 per cent in cash), while in 2022 - the year with the highest proportion of cash sales - cash purchases accounted for 45 per cent of the total.

To find a proportion similar to that recorded in 2026 for mortgage payments, one has to go back to 2020, when 71 per cent of property sales (16,551 out of a total of 23,265, figures very similar to those recorded this year, although in 2026 these cover only the first eight months) were paid for with a bank loan. In earlier years, cash payments accounted for around half of all transactions, or even more, such as in 2014 or 2013, when cash purchases accounted for 66 per cent and 68 per cent of total sales, respectively, according to INE data.

The situation was very different in previous years - those leading up to and following the bursting of the property bubble - when more mortgages were being signed than property sales were taking place. For instance, in 2007, the earliest year for which data is available on both sales transactions and signed mortgage loans, there were 42,386 property sales, while the number of mortgages agreed in the province exceeded 54,500.

Recently, however, an increasing number of property sales are being financed by mortgages, even though the cost of borrowing continues to rise. The average mortgage taken out in the province this year stands at 246,700 euros, representing a 15.6 per cent increase on the 213,400 euros recorded a year ago. As a result, the average mortgage taken out in Malaga remains the third highest in Spain, behind only the Balearic Islands and Madrid (€315,390 and €263,870, respectively).

Mortgages are becoming more expensive not only because loan amounts are getting larger, but also because the Euribor is rising. Based on figures up to this Monday, the average for October stands at 3.22 per cent, compared with 2.187 per cent in October last year. This means that the monthly repayment on a mortgage taken out exactly a year ago (worth around 240,000 euros) will increase by more than 100 euros following the October rate adjustment.

Across Spain as a whole, the average mortgage taken out this year stands at around 175,600 euros, representing an increase of nearly 10 per cent compared with the figure from a year earlier, when it stood at around 160,200 euros.

In Malaga, property sales have fallen while the number of mortgages taken out has risen, reflecting the broader national pattern. Across Spain, in the first eight months of 2026, the number of homes sold fell by 2.3 per cent, while the number of mortgages taken out rose by 5 per cent.

Malaga is the fourth province in the country in terms of the number of mortgages signed so far this year, behind only Madrid, Barcelona and Valencia, and ahead of Alicante, Seville, Murcia and Cadiz. In terms of overall property sales, it ranks fifth, behind Madrid, Barcelona, Alicante and Valencia, but ahead of Seville and Murcia. It even ranks ahead of entire autonomous communities, such as the Basque Country, Galicia, the Canary Islands and Aragon.

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