The homes they allocated some 12,000 million of euros of their savings last year, especially in the second half of the year, to carry out early repayments his mortgages and mitigate the impact on the quotas of the accelerated rise of the Euribor. This caused the credit balance for home purchase get off (0.07%, at 510,957 million) after grow in 2021 for the first time since 2010, which at the time seemed to mark a change in trend. Thus, the new operations amounted to 65.220 million in 2022, while the total amortizations (advance loans plus natural ones due to the expiration of the loan term) rose to an amount 389 million more, from 65,609 millionaccording to data from the Bank of Spain.
The balance of mortgages began to go down last August for the first time since the end of 2020, with which repayments have exceeded new loans since then, largely thanks to early payments. “Many families with savings they have gone to their banks to ask them how much they needed to repay advance of their mortgages so that the quotas remained more or less the same despite the rises in the Euribor. In the big citieswhere the amount of credits is higher, they have basically been able to do so families with more savings and higher rents. But in the rest, let’s say that the size of Saragossa downis a process that could have been more generalized“, indicate financial sources.
Everything points to the trend will continue this yearespecially when the Ministry of Economy agreed last November with the bank that customers do not have to pay commissions for early repayments during 2023 (Nor for passing the credit from variable to fixed rate). For now, the mortgage balance was reduced in January and February by another 4,800 milliondespite the fact that new mortgages were granted for the value of 8,098 million (13% and 1,212 million less than in the first two months of 2021), which implies that amortizations were 12,898 million (45% and 4,054 million more).
triggered euribor
With advance payments, families who have been able to afford them have tried to hide Given the accelerated and unprecedented rise registered by the euribor since last year. As a consequence of the increases in official types of the European Central Bank (ECB) to combat the inflationthe indicator to which most of the mortgages variable rate in Spain it went from -0.502% December 2021 (zone of historical minimums) to close 2022 in the 3.018%. The increases have continued so far this year and the average rate at which banks lend to each other stood at March at 3.647%.
The consequence has been that the mortgage payments at a variable rate they have been since last year getting more expensivealthough the higher increments (greater than three percentage points plus the differential agreed in the contract) began with the Euribor October and they will continue until the middle of the year, and then gradually moderate. This is due to the fact that the installments rise if the Euribor is higher than a year before in the month that serves as a reference to review the credit (usually the month of two months before). In it second semesterwill begin to be compared with the highest levels of the second half of 2022, with which the rise in quotas will tend to soften.
The rise of the Euribor has caused the average portfolio rate of bank mortgages has gone from moving in the zone of historical minimums of around 1.1% end of 2021 to shoot at 2.5% in Februarymaximum since the same month of 2013. The average interest on the mortgage balance, thus, has increased with unusual rapidity both due to the old credits review as for him price of the newat a variable rate and at a fixed rate, whose average interest rate has risen from the all-time low 1.382% in December 2021 at 3.431% last February, the most expensive price since April 2012.
containment factor
Curiously, defensive early repayments of homes could be slowing down the rise of the new mortgages. “Contrary to what it might seem, the rise in rates and the Euribor they are not moving so strongly to price of new mortgages that are currently being offered. Outstanding bank balances are falling due to the advance payment acceleration of existing mortgages, and the competition between entities continues to be tough, so they still offer interesting mortgages to be able to attract customers”, pointed out Juan Villén, general director of mortgages at Idealista.
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Mortgages in Spain, in any case, have been more expensive than in the euro zone between December 2021 and last February, both in balance (in the monetary union they have gone from 1.63% to 2.05%) and in new credits (from 1.31% to 3.24%). In parallel, the remuneration mean of the deposits in Spain (0.86% in the new and 0.32% in the balance in February) continues to be well below average of the euro countries (1.92% and 1.45%), which explains why Spanish banks have shot up the profitability obtained from their retail customers to maximum levels.
Despite this low pay, the economic uncertainty led Spanish households to reserve a new all-time high of 1,078 trillion euros in cash and deposits last year, 43,944 million and 4.2% more than in 2021, despite the fact that high inflation made lose purchasing power to these savings. Despite this increase, the total financial wealth of families (assets minus financial liabilities) fell slightly -0.2%, to 1.95 trillion- due to the loss of value of their investments in mutual funds, listed shares, life insurance and annuities, and pension funds, due to the bad year registered in the markets due to the inflationary spiral and the war in Ukraine.