Month by month, Spanish households are reducing their debt through discipline and repayments. Between January and September, they reduced the mortgage by 11,259 million euros, bringing the credit for the purchase of a home to 497,948 million, according to the latest data from the Bank of Spain. It is the lowest level since May 2006.
The sequence of mortgage debt is also that of recent economic history. It climbed to an all-time high of 655.42 billion in December 2010 and then slowly retreated until recently. With the rise in interest rates, many households decided to dedicate the savings from the pandemic to paying off the mortgage.
The decline in this type of debt also responds to the drop in mortgage signing, of 22.7% in August, according to the latest data from the INE. The Bank of Spain estimates that mortgage loans worth 4,231 million were signed in September, 12% less than in the same month of 2022.
Another example of the strength of households is that in September they subscribed bank deposits for 11,013 million, the highest figure so far this year. This does not prevent, as the Bank of Spain also highlights, interest rate increases from placing one in seven households at financial risk. They are those who dedicate more than 40% of their income to paying debts.
