Mortgage trends for 2025: experts' views

In December 2024 home buyers took out 1,957 loans in Malaga province for an average sum of 186,000 euros, behind only Madrid and the Balearics

Europa Press

Friday, 21 February 2025, 15:34

Spain's chief real estate portals, Idealista, pisos.com and Fotocasa, are of the view that the number of mortgages taken out by borrowers will continue to grow during 2025. This is on the back of the upward trend that started last year. According to data from the INE (Spain's national statistics institute), in December last year 32,249 loans were signed in Spain, a year-on-year increase of 30%.

Malaga province saw 1,957 mortgages signed in December, a growth of more than 62% on the same month of the previous year, when the total was 1,205. This was the highest number of mortgages taken out in December since 2007.

Malaga was the fourth Spanish province with the largest number of mortgages signed in December, behind only Madrid, Barcelona and Valencia.

The total number of home loans taken out in the whole of 2024 in Spain was 423,761, an increase of 11.25%.

In terms of amounts borrowed, in Malaga province the average sum in December last year was 186,717 euros, a fall of 5.35% on the same month of the previous year. Meanwhile the average amount borrowed in Spain as a whole in December was 152, 376 euros, 8.27% more than the previous year.

This puts Malaga province as the third in Spain for the highest loans taken out to buy a property. It follows Madrid with 236,000 and the Balearics with an average mortgage of 290,000 euros.

Looking at 2025, the specialist real estate portals reckon that, by the end of the year, the number of mortgages taken out will show a good, higher total. After all, if we go by the first 11 months of last year, the total number of mortgages had already exceeded the total number of mortgages for all of 2023 by 10%.

Mortgages director at Idealista, Juan Villén, stressed that the increase in mortgage prices is a "one-off issue", as the average interest rate went from 3.12% in October to 3.28%. He is of the view that competition between lending institutions in the face of increased demand for mortgages will bring prices "to lower levels".

Likewise, he views as "surprising" the dips and swings that occurred within some regions during the month of November. For example, in Madrid mortgage business fell by 2% annually, while the number of property sales and purchases grew in the same period by 35%. As such he recommends following the market closely to see if this is "a one-off anomaly or if it is a trend that is firming up."

Turning to María Matos as research director at Fotocasa for her opinion, she said that variable rate mortgages, despite their reduction in recent months, could begin to show "greater competitiveness" if market conditions continue to improve.

"Competition between banks is driving demand for purchases and loan applications, so mortgage signings are expected to accelerate and could close the year above 420,000 and become the second best mortgage year since 2010," said Matos.

Likewise, this upward demand for both mortgages and the number of purchase transactions is being stirred up with the reduction in financing, which in turn is thanks to the reduction in interest rates. According to Fotocasa it is this fall in interest rates that will cause the upward pressure on housing prices to be maintained in the medium term.

The portal pisos.com welcomes this positive trend in the number of mortgage signings and points out how varied the state of play is across the country. For instance, while the numbers in Madrid fell by 2% and Andalucía barely grew by 3%, the regions of Valencia and Catalonia showed increases of 20% and 34% respectively.

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