British, German and Swiss nationals who earn around €6,000 a month are the standard foreign property buyers in Spain currently, new data reveals.
Demand for Spanish properties among foreign buyers continues unabated in 2023, following a 30 percent rise in demand among non-Spaniards in 2022 according to Spanish appraisal and ovulation society Euroval.
Whereas national buyers are taking out fewer mortgages in 2023, dissuaded by high interest rates for both variable and fixed hipotecas, overseas buyers are the driving force of Spain’s real estate market, and one of the reasons why property prices are not dropping despite there being less demand overall in Spain.
According to Spanish property search giants Idealista, UK nationals represent the foreign group applying for the most mortgages in Spain, making up 18.8% of the total in Q2 2023. They were followed by German nationals (14.2%), Swiss buyers in third position (9.5%) and American property hunters in fourth (8.4%).
Their average monthly earnings are €5,933, far above the average gross wage in Spain, which in 2023 is €1,714 a month per employee, or €3,277 per household. American and Swiss buyers have the most disposable income available, with an average monthly salary of more than €9,000.
These high-earning foreigners want to buy a home in Spain which on average costs €210,000, Idealista’s study found, although higher-earning Swiss, German and American buyers look for homes which are more in the €240,000 range. Spaniards on the other hand are currently buying homes which on average cost €175,000.
The mortgage loan foreigners request is €151,2000 in median terms, with the wealthier property seekers from Switzerland and US taking out mortgages in the €175K-€180K range. Therefore on average foreigners apply for mortgages for around 70 percent of the value of the property, in line with what most Spanish banks are willing to offer.
In Q2 2023, 72 percent of the mortgages approved for foreign nationals in Spain were fixed-term, 25 percent were mixed and only 3 percent were variable.
Spain’s Valencia region, which encompasses the Costa Blanca, continues to be preferred area for foreigners to buy a property in the country, representing a third of mortgages in Q2. Andalusia (21.3%) and Catalonia (14.1%) are the second and third favourite regions of foreigners buying homes in Spain.
As has always been the case, foreigners tend to prefer to have a home on the Spanish coast, but this can work out to be considerably more expensive. In fact, buying a Spanish property that’s not in a popular tourist area currently works out to be 75% cheaper, the biggest difference in ten years, Caixabank Research reported in late July.
If you are looking to buy a property in Spain and need a mortgage, email mark@vci-network.com for the latest criteria
