THE number of mortgages issued for Spanish homes in October dropped the most since April 2009 as demand flagged before the expiry of a tax incentive.
The number of home mortgages fell 24 percent from a year earlier, the National Statistics Institute said in a statement today. Asking prices for existing homes in Spain slipped 5.7 percent in 2010, according to separate data published yesterday by Idealista.com, a Spanish property website.
The drop in mortgages coincides with a slide in home sales, which fell about 18 percent from a year earlier in October to the lowest level on record. Spanish banks, which have what the Bank of Spain terms troubled exposure to construction and real estate of 181 billion euros, are counting on a recovery in demand to help them clear stocks of foreclosed property taken onto their books during the country's housing crash.
None of this data will be good news to all those who are looking for the beginning of the end of Spain's property crash, said Mark Stucklin, head of Spanish Property Insight, a Barcelona-based website that tracks trends in the housing market.
You have to wonder whether it's even the end of the beginning.
Homes sales had increased through the first eight months of the year before a year-end deadline to lock in a tax rebate, valued at as much as 1'352 euros a year.
Mortgage lending in terms of capital loaned declined 33 percent from a year earlier, the most since October 2009, the statistics institute said today.
Total housing permits fell 34 percent in October from a year ago, the Development Ministry said in a separate statement.