Mortgages soar by 54.4% in May, with fixed rates present in 70% of contracts

The number of mortgages for home purchases grew by 54.4% in May compared to the same month last year, reaching 42,274 loans. This May figure, which is 40 points higher than April’s (+14.4%), marks the eleventh consecutive month of increases in mortgage signings.

According to the National Statistics Institute (INE), the average amount of mortgages constituted on homes stood at €158,153, representing a 12.7% rise from May last year and the highest value since February 2020. In addition, the average term of these mortgage loans was 25 years.

Regarding interest rates, the average in May was 2.91%, almost 0.1% lower than in April (2.98%). Thus, mortgage interest rates have remained below 3% for the fourth consecutive month, after being above that level for nearly two years until February.

Looking at the breakdown, 30.1% of home mortgages formalized in May were variable-rate, with an initial average rate of 2.78%. Meanwhile, 69.9% were fixed-rate, the highest share since August 2022, with an initial average rate of 2.97%.

In the comparison of May versus April, the number of home mortgages increased by 7.9%, while the average amount rose by 1.5%. In the first five months of the year, 201,423 mortgages have been signed, 23.6% more than in the same period of 2024.

Juan Villén, managing director of Idealista/hipotecas, emphasized that “the registered mortgage figures in May are very positive: we continue to see strong growth in activity, driven by the dynamism of the housing sales market and banks’ willingness to grant loans. Interest rates remain below 3%, and fixed-rate mortgages now account for almost 70% of the total, providing stability both for buyers and financial institutions.”

On the evolution of the housing market, Villén added that “there are no signs of a short-term correction, so we expect the current trend to continue in the coming months.”

However, a shift in the profile of applicants is evident. María Matos, director of Research at Fotocasa, pointed out that “buyers who previously could not access the market due to high financing costs are now entering.” Research from Fotocasa indicates that one in three young buyers is motivated by the new mortgage conditions. Matos also noted an increase in high-solvency buyers, who require less financing due to greater purchasing power.

Matos further predicted that “in the coming months, the percentage of buyers who do not need to apply for a mortgage—currently 31%—will decline thanks to improved banking conditions.” This will increase demand in a context where housing supply is not growing at the same pace, pointing to upward pressure on housing prices in Spain and Barcelona.