Understanding the mortgage rates in Spain is important for anyone looking to move to, or buy property in, one of Spain’s many popular towns and cities. Before you speak directly to lenders, it’s a good idea to try and understand the options available to you and gather any essential details you might need.
Where Spanish properties are in demand, it’s important that you have the information required to move quickly and land your dream home. Whether you’re an expat looking to become a permanent resident or a local hoping to move to another Spanish hotspot, understanding the mortgage rates and the process when applying for a mortgage is vital for a smooth process.
Mortgage Interest Rates in Spain
In 2024, mortgage interest rates in Spain will vary depending on the type of mortgage you choose and your financial circumstances. These interest rates can be categorised into fixed-rate and variable-rate mortgages.
Variable Rate Mortgages (Euribor-Based)
Variable rate mortgages in Spain are tied to the European Interbank Offered Rate (Euribor), which fluctuates. The mortgage rate is typically expressed as Euribor plus a margin, for example, Euribor + 1%.
In the UK and US, mortgage interest rates are currently very high, with actual costs often sitting between 6 and 8%. This makes the mortgage interest rate in Spain (between 3% and 4%) an attractive option for non-resident buyers.
Currently, the Euribor rate is seeing some fluctuations due to economic factors, but it's still one of the more popular options for borrowers, especially those who anticipate falling interest rates in the future.
Fixed-Rate Mortgages
In many cases, non-residents are limited to fixed-rate mortgage products when buying properties in Spain.
Fixed-rate mortgages in Spain offer more stability, with interest rates locked in for the duration of the loan. Borrowers often choose this option for its predictability.
Fixed mortgage rates in Spain currently range between 2% and 4%, depending on the lender and the loan term. This rate can also fluctuate depending on the applicant’s profile and creditworthiness.
Mixed Mortgages
Some lenders offer mixed mortgages, which begin with a fixed interest rate for the first few years, then switch to a variable rate based on Euribor.
These are a good option for those who need cost security when first buying a property.
Mortgage Rate in Spain for Foreigners
Spain is a popular destination for foreign property buyers, particularly those from the UK, Germany, and other EU countries.
Fortunately, Spanish banks and lenders will offer mortgage products to non-residents, though the terms may vary slightly from the Spanish mortgage rates for residents.
- Deposit or Down Payment: Non-residents are typically required to provide a larger deposit to secure a home loan in Spain. This is often 30%-40% of the property’s total value.
This is around 10% more than the amount usually required by residents though this can vary depending on the product and credit profile of the applicant.
The greater the deposit you are able to provide, the lower the LTV (Loan-to-value) ratio of your mortgage.
- Interest Rates Mortgage interest rates for foreigners in Spain are generally comparable to those offered to residents. However, in some cases, lenders may charge a slightly higher margin for non-resident borrowers due to the perceived risk.
Because of this “risk”, some non-residents may also be limited to fixed rate mortgages when buying a property in Spain.
- Required Documentation Foreign buyers must provide certain documents, such as proof of income, tax returns, and bank statements when applying for a mortgage in Spain.
See if you’ll be eligible to buy a property in Spain.
What is the Average Mortgage in Spain?
The total cost of a mortgage in Spain will vary depending on several factors. These can include the property location, loan-to-value ratio, and the borrower’s financial profile.
Here’s an idea of the cost breakdown for a home loan in Spain in 2024:
- Average Loan Amount: The average mortgage loan in Spain is around €142,000, though this can be higher in larger cities like Madrid and Barcelona, and lower in rural or smaller towns.
- Interest Rates: Variable-rate mortgages are usually tied to the Euribor, with average interest rates of 3% to 4%. Fixed-rate mortgages tend to be between 2% and 4% depending on the product.
- Mortgage Term: Most Spanish mortgages have a term length of 20 to 30 years, but depending on the lender and the buyer’s circumstances, shorter or longer terms are also available.
- Monthly Repayments: Based on the average loan amount, monthly repayments typically range from €500 to €800. These payments fluctuate based on the interest rate type (fixed or variable) and the length of the loan. Higher value properties or short repayment terms will often have larger monthly costs.
- Deposit: A 20%-30% deposit or down payment of the property’s value is required for residents, while non-residents may need to put down 30%-40%.
Mortgage Rate in Spain Calculator
Before diving into the specific mortgage products available, it's often a good idea to explore roughly how much your mortgage will cost. The guide above is very general, and with mortgages, there are lots of important factors to consider.
Mortgage calculators are widely available online and can help you get a clearer picture of what you will pay monthly. These calculators typically require details such as the loan amount, deposit, interest rate, and repayment term.
Try our calculator to find what works for your budget.
The Next Steps For Getting A Mortgage in Spain?
For both residents and non-residents, securing a mortgage in Spain requires a thorough understanding of the current rates and the many options available.
With a range of fixed, variable, and mixed mortgage products to choose from and several lenders to consider, buyers have plenty of flexibility in choosing the best fit for their needs.
Whether you’re an experienced buyer or exploring the Spanish housing market for the first time, we have plenty of resources to make your purchase a success.