Spain’s mortgage market keeps gathering pace. On 20 July, the statistics office INE published its figures for May 2026: banks arranged 40,010 home mortgages — 2.3% more than a year earlier. The average loan grew by 11.1% to €173,331. At the same time borrowing got cheaper: the average rate on new home loans dropped to 2.90%. For buyers, this means money for a home in Spain is being taken out more readily, and servicing it has become a little easier.
Content:
- What the INE figures show
- Why rates are falling
- Fixed or variable rate
- It is not only mortgages that are rising, but prices too
- Where foreigners most often buy
- What it means for the overseas buyer
- What a non-resident needs to get a mortgage
- Frequently asked questions
What the INE figures show
The May INE data is a snapshot of the country’s entire mortgage market. It shows how many loans banks issued, for what amounts and at what rate. All three indicators moved in the buyer’s favour over the year: there were more loans, the average size grew and the rate fell. The key figures are in the table.
| Indicator | May 2026 |
|---|---|
| Home mortgages issued | 40,010 (+2.3% year-on-year) |
| Average loan | €173,331 (+11.1%) |
| Average rate on new loans | 2.90% |
Why rates are falling
Mortgage rates in Spain are heading down in step with the European Central Bank’s policy. The ECB has cut its key rate steadily, and that has made loans cheaper across the eurozone. Most new loans in Spain are taken on a fixed rate, so buyers lock in favourable terms for the whole term. The average 2.90% is well below the 2023–2024 peaks, when borrowing cost noticeably more.
Fixed or variable rate
In Spain, mortgages come in two formats — fixed and variable. A fixed rate (tipo fijo) does not change over the term: the payment is known in advance, and most new loans are now arranged this way. A variable rate (tipo variable) is tied to the European Euribor index plus the bank’s margin — it can fall or rise. With rates coming down, some borrowers choose a mixed option: a few years on a fixed rate, then a switch to variable.
| Rate type | How it is calculated | Who it suits |
|---|---|---|
| Fixed (fijo) | unchanged for the whole term | those who want a predictable payment |
| Variable (variable) | Euribor + the bank’s margin | those expecting Euribor to fall |
| Mixed (mixto) | fixed first, then variable | a compromise between the two |
It is not only mortgages that are rising, but prices too
Cheap credit heats up demand, and prices with it. According to INE, homes in Spain have risen in price by around 13% over the year. Major banks forecast price growth of about 10% for 2026 as a whole. Hence the rising average loan: buyers borrow larger sums to buy now, before homes climb further.
Where foreigners most often buy
Foreign buyers’ demand in Spain has traditionally centred on the coast and the islands. The average home price across the country in spring 2026 held at around €2,750 per sqm, but in the regions popular with foreigners it is noticeably higher. Cheap mortgages are widening the geography of demand: buyers are looking not only at premium resorts but at more affordable inland provinces too.
- Costa del Sol (Málaga)
- Costa Blanca (Alicante)
- the Balearic and Canary Islands
- Barcelona, Madrid, Valencia
What it means for the overseas buyer
Foreigners can also take out a mortgage with Spanish banks. Non-residents are usually approved for up to 60–70% of a home’s value, residents for up to 80%. Rates for overseas buyers are a little higher, but the general downward trend works for them too. Falling rates against rising prices add up to a simple conclusion: the terms for getting in are more favourable now than they are likely to be in a year.
“The combination of cheap credit and rising prices is pushing buyers to act faster,” say analysts at Spain-real.estate.
“For non-residents, a Spanish mortgage remains a workable tool: the deposit is higher, but rates are coming down,” market observers add.
What a non-resident needs to get a mortgage
A non-resident can arrange a mortgage in Spain — the process is well established. The bank will assess income, credit history and the deposit, and will approve the amount after an independent valuation of the home. On top of the deposit, it is worth setting aside around 10–12% for taxes and fees — the standard buyer’s costs in Spain. Under a 2019 law, the bank now pays most of the associated banking costs, leaving the valuation to the buyer. The main steps are standard and take a few weeks.
- obtain a Spanish foreigner’s number (NIE)
- open an account with a Spanish bank
- confirm income and employment (certificates, tax returns)
- order an independent valuation of the property (tasación)
- sign the loan agreement before a notary
Frequently asked questions
What is the average mortgage rate in Spain now?
According to INE for May 2026, the average rate on new home loans is 2.90%. That is lower than a year earlier.
Can a foreigner take out a mortgage in Spain?
Yes. Spanish banks usually approve non-residents for 60–70% of a home’s value, at a rate slightly higher than for residents.
Does buying property grant residency?
No. Spain scrapped the property “golden visa” in April 2025. You can still buy a home, but it no longer grants residency automatically.