Expectations that the ECB will begin to lower interest rates in the coming months are already being felt in the Spanish credit market. The interest rates at which banks set new credit operations for the purchase of housing stood at 3.49% in March, according to data just published by the Bank of Spain.
This reference is the lowest since January 2023, when mortgages were subscribed at an average of 3.25%. Since then, the percentage had only increased, to near levels of 4%, at the rate of interest rate rises. The ECB began tightening monetary policy in July 2022, until it set rates at 4.5% in the middle of last year.
The interest reported by the Bank of Spain is below the Euribor, which is the main reference for the granting of mortgages in Spain. Sources at the institution indicate that the calculation corresponds to the weighted average rate of the loans, not including commissions or additional expenses. They show, however, the tendency of the banking sector in longer-term loans to individuals.
The Euribor closed April at 3.7%, a percentage very similar to March. After reaching 4.1% in October of last year, the trend is now downward, amid expectations that the ECB will begin to soften monetary policy in June.
Bank of Spain data also show that, between January and March of this year, banks granted mortgages for 14,358 million euros, a volume 9% lower than that of the same period of the previous exercise.
The total granting of bank credit in the first quarter of the year stood at 59,952 million euros, 6.8% less than at the beginning of 2023. In this case, there are different trends depending on the type of loan .
The decline did not only take place in the area of housing, but also in loans associated with credit cards, which usually cover one-off overdrafts and which have gone from 35,185 million a year ago to 32,363 million at the beginning of 2024 .
The only category of credit in which an upward trend can be seen is that of consumption. Until March, banks granted 8,876 million euros in loans of this kind, 3.5% more.
