Home mortgages surge 31.7% in June hitting 14-year high

DEMAND for home loans has rocketed in the past year as Eurozone interest continues to fall, but nearly three-quarters of borrowers are opting for fixed rates as a precaution, latest official figures show.

As at June 2025 – the most recent full month on record – the number of new mortgage deals signed had been consistently on the rise for a year, reveals the National Institute of Statistics (INE).

That month alone, almost 42,000 came into effect – an increase of 31.7% on the total for June 2024.

Whilst the year-on-year difference was greater for May – up by over 54% on the same month in 2024 – the actual number of home loans signed in June was higher, and the amount borrowed was greater, the INE reports.

The average mortgage on a residential property in June sat at €168,363, over a 25-year term - and with a typical interest rate of 2.99%, slightly higher than May's 2.91% - being a 15.5% increase on the average loan taken out in June 2024.

Overall, the total capital sum lent was 5.3% greater in June than in May, almost 43% more than six months previously, and 52% higher than a year before, reaching a global figure of just over €7 billion.

Nearly eight in 10 mortgages on fixed-rate basis

Typical mortgage interest rates in Spain in June were below 3% for the fifth consecutive month, reveal INE data, having been well above this level for the two preceding years and starting 2025 on 3.08%.

In line with an unprecedented trend that started in 2016, the number of fixed-rate mortgages continues to surpass that of variable-rate loans, and the gulf was wider than ever after by the end of the second quarter of 2025: From barely 10% a decade ago, fixed-rate deals now account for 78% of the total.

Mortgage interest is typically higher when fixed; deals which became effective in June carried an average rate of 3%, compared with 2.98% for variable-rate loans.

According to the INE's half-year analysis, the number of new mortgages taken out in June was the highest for that month since 2022, whilst the total figure for the first six months of 2025 was the greatest in 14 years.

From January to June inclusive, borrowers sealed 243,257 loan deals – only marginally below the 243,632 seen in the same period in 2011, a figure that has never yet been reached since.

Only 14% of mortgages used for buying main home, says study

Research based on INE data, carried out by leading financial services consumers' association ASUFIN, shows that only 14% of mortgages contracted in the first half of 2025 were for a main residence, whilst 85% of borrowers already owned one or more homes.

ASUFIN reports that 19% of property loans granted from January to June were for second homes or holiday homes mainly destined for personal use.

More than half (56%) of mortgages taken out in these six months were to finance purchases of residential property as an investment or to generate rental income, ASUFIN reveals.

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