Two Tier Mortgage Market Holding by Spanish Property Market Recovery

01 May 2014

With the news that over 50% of all properties that were sold in the Malaga province in 2013 were sold to overseas property buyers the real question is when will the local market start to improve? According to Spanish Hot Properties Managing Director Nick Stuart this will happen once the Spanish Banks start to lend more positively especially to the local community. Not before this happens can the housing market really recover.

The international buyers in reality have saved the Spanish property market from the abyss of a total meltdown and with the majority of these buyers not needing finance has helped the market enormously injecting substantial cash and much need taxation revenue into the Spanish economy said Nick.

However the Spanish banks are not lending more than 70% of the purchase price meaning that any new buyer requiring finance needs at least 43% cash deposit which is very difficult to come up with in the current recession.  This is stopping the sales of housing that the international property buyers have no interest of buying and also causing a hindrance to those international buyers who need finance.  Also banks are applying strict underwriting rules that means that a lot of buyers who can afford to pay their mortgage are unable to get the credit they need to buy properties.

There are obvious exceptions to this and this relates to the overpriced properties that Spanish banks have on their books where they have been lending up to 100% plus costs to achieve the price they wanted to get for the property. This is clearly illustrated in certain developments where you can buy at 40% below the banks price but can’t get any finance and means you must be a cash buyer to take advantage of these opportunities said Nick.

So until the Spanish Banks start to lend more aggressively it looks like the international buyer will continue to shining light of the property market in Spain

If you would like advice or help in relation to finance when buying a property in Spain contact Spanish Hot Properties who would only be too happy to help.

Share this news

Click here to view our full Spanish Property News archive

More information

Contact Us

Fill in our form and we will contact you

Property Search



  • "Honest and supportive Nick managed the whole process from start to finish and made sure the whole sale and mortgage approval went through smoothly"
  • "Having never bought in another country before Spanish Hot Properties were superb in taking us through the whole buying process in Spain, a pleasure to deal with"
  • "Michel and Spanish Hot Properties were superb and unlike any other real estate agent we had previously dealt with and their attention to detail was superb"
guide to buying property in spain
sell your property in spain
find me a property
luxury spanish property
Video of the Month
relax whilst we find your dream home

Follow news and updates with Spanish Hot Properties

follow us on twitter follow us on google plus follow us on youtube follow us on facebook follow us on LinkedIn follow us on Pinterest

We post the most up to date information to help you make the perfect property purchase