The Spain that pays ‘tocateja’: more than 200,000 home buyers have not requested a mortgage

2023-10-31 07:55:22

The increase in interest rates initiated by the European Central Bank in March 2022, and its correlation with the Euribor, the interbank rate to which most mortgages are referenced, is having a impact on the housing market. With the average rate on mortgage loans at 3.24%, according to the National Institute of Statistics, more and more Spaniards (and foreigners) are opting to buy homes without financing.

According to the latest report from the appraisal company UVE Valaciones, so far in 2023, with annualized figures, 204,859 houses have been purchased without financing through a mortgage. Since 2020, the year the pandemic broke out, the number of home sales carried out without access to financing has been increasing, practically doubling the number of this type of operations. During this last year, the rise has not slowed down, compared to the granting of mortgages, which has been falling in recent months.

In the short and medium term, the number of buyers who are financed will not increase. “Those who can buy a home in cash do not suffer the effects of rising interest rates and do not opt ​​for less profitable alternative investments. In addition, rising rents are a incentive for those who have a heritage vocation to investin order to defend against inflation,” they point out from UVE Valoraciones.

For the first time in the last four years, the percentage of homes purchased that are mortgaged has fallen from 70%, until reaching 67%. This figure is lower in the case of new construction houses. According to the study ‘Profile of the New Construction Home Buyer 2022’, published by the developer Aedas Homes a few months ago, only 52% of buyers financed the acquisition of their property, the amount of which is higher than that of a second-hand property in the market.

The provinces where fewer houses are bought with a mortgage

There is a trend of which are the provinces that pay the most to ‘tocateja’: those with largest tourist component and those that could be classified as the ‘Emptied Spain’. At the other extreme are the Basque Country, Madrid, Seville, Barcelona, ​​Valladolid and Zaragoza, which are the provinces with a low percentage of purchases without financing, according to UVE Valuations.

Alicante, Málaga, Valencia y Barcelona are the four provinces where more houses have been bought without debt: a total of 33,477, 16,144, 13,859 and 13,859, respectively. This list also includes Murcia (9,868), Almería (7,073), Madrid (6,716), Girona (6,677), Tarragona (6,669), Santa Cruz de Tenerife (5,968), Castellón (5,860), the Balearic Islands (5,439) and Granada. (5,347).

In addition to being the province where the most houses have been purchased without a mortgage in number of units, Alicante It is also in percentage: approximately, Only one in three homes that change hands requires doing so through debt (65%). The other provinces that exceed the percentage of 50%, that is, one in every two homes are paid to ‘tocateja’, are Ávila (62%), Zamora (56%), Castellón (52%), Cuenca (51% ), Lugo (51%) and Soria (50%).

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At the other extreme, there are the provinces where the acquisition of a property is financed the most. In Gipuzkoa (95%), Vizcaya (94%), Álava (92%) and Madrid (91%), buyers take out a mortgage. The percentages are high, above 70%, also in Seville, Melilla, Barcelona, ​​Pontevedra, Ceuta, Zaragoza, Valladolid, Córdoba and Badajoz.

Does the lack of mortgages affect prices?

The study prepared by the appraiser indicates that where the proportion of financed purchases is higheras in Madrid, Barcelona, ​​the Basque Country or Seville, there are “more likely to see purchase prices decline”. “Madrid, Barcelona, ​​the Basque Country and Navarra show very low growth in transactions compared to 2019. What can save them from the drop in prices is that they are areas with a housing deficit. In tourist areas with a high proportion of purchases without financing it is very “it is likely that prices will continue to rise. For those who are looking for a home for their own use in these areas and have to finance themselves, the situation will worsen: higher prices and lower purchasing power,” they conclude.