Ny Nigel Davies

SPANISH mortgage lending fell less sharply in January than in December, even though demand and credit conditions remained tight, suggesting no significant pick up for some time.

January mortgage lending for housing totalled 6.06 billion euros, 5.5 percent lower than a year earlier, the National Statistics Institute said yesterday.

That was down from the 10.37 billion euros loaned in December, but smaller than the 10.2 percent fall recorded in that month. The latest figures chime with data earlier this month showing house sales rose in January for the first time in two years, even if a recovery in the housing sector looks some way off.

Unemployment nearing 20 percent will likely keep mortgage lending at low levels for some time. “We have to look at these data cautiously as there are still a lot of macroeconomic uncertainties,” said Jose Luis Martinez, an economist at Citi, who saw no sign yet of a change in trend. He said that mortgage data could well have been helped by falling prices as estate agents and banks look to offload houses from their books. House prices fell by just over 6 percent last year, but some economists believe official data understate the full scale of a slide since a property bubble burst in 2007.

Official data also showed the average mortgage value fell by 18.8 percent year-on-year in January after falling 17.1 percent in December.