Where in Spain is it easiest and hardest to repay a mortgage?

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Where in Spain is it easiest and hardest to repay a mortgage?
Málaga skyline. Photo: Paolo Trabattoni/Flickr

Find out where in Spain a mortgage is likely to eat up most of your monthly earnings.


Madrid and Barcelona aren’t the cities in Spain where homeowners cough up the most for their mortgages. 

That’s according to a new study by Spanish finance evaluator Tinsa, who have drawn a ratio between average mortgage prices and monthly wages in different cities and provinces across Spain.

The Balearic Islands and Malaga, home to some of Spain’s biggest expat populations, are at the top of the leaderboard.

In the archipelago made up of Majorca, Menorca, Ibiza and Formentera the average financial burden for families dealing with their first year of mortgage repayments is of 23.5 percent.

The Balearics also had the highest average mortgage in Spain in the second trimester of 2018 - just over €175,000.

Malaga is next in line in terms of the chunk taken out of monthly wages devoted to mortgage repayment – 22.2 percent – even though the average property price in this city and province is seventh in the table.

In third position is Barcelona, where average mortgages stand at roughly €153,000, representing 18.2 percent of families’ monthly earnings.

Madrid presents perhaps the most interesting findings on the list, as although average home loans are the second highest in Spain (€172K), the financial burden to homeowners is less on average (9th in the table), largely due to higher wages in the Spanish capital.

Source: El País/Tinsa

Provinces in Spain where mortgage repayments represent the lowest burden for families include Tarragona , León, Huesca, Lugo (all at around 13 percent), Teruel, Alava, Palencia, Castellón and Soria (at around 12).

Most of these cities and the provinces in which they lie also have some of the lowest mortgage prices in Spain.

The average mortgage in Spain is €121,737, representing 17 percent of earnings before tax and deductions.

According to Spanish real estate valuation firm Sociedad de Tasación, Spaniards currently need to work an average of 7.6 years to repay their mortgages, that’s if all their wages were used for home loan repayments.

Using this calculation, anyone with a mortgage in the Balearics would need to work 15.4 years to pay it off whereas in La Rioja it would be just 4.8 years.

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Average monthly mortgage repayments are around €850 in the Mediterranean archipelago, roughly €500 higher than in cities such as Cuenca, Lugo and Ciudad Real.

Homeowners in Madrid and Barcelona repay on average €739 and €731 a month respectively if they’ve taken out a loan.

READ ALSO: What you need to know about Spain's newest rent law changes 



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