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Home Sales and Mortgages Decline in February

New mortgages fell 12.8% compared to last year
New mortgages fell 12.8% compared to last year, and home sales down too

New mortgages fell 12.8% compared to last year

Data provided by the College of Property Registrars on the home sales and of new mortgages registered during the month of February confirms the downward trend and the impact on the market of the coronavirus pandemic. After the bad start seen in January, with the biggest drop seen in mortgages (-30.4%) and the return to negative figures for sales (-15.4%), the data for February once again confirmed a year-on-year drop in operations in both scales.

On the part of home mortgages, the drop (-12.8%) was a large decrease of more than 4,000 loans, from the 34,241 home mortgages registered in February 2020 to the 29,868 operations in February 2021.

Although the mortgage market showed a greater resistance at the beginning of the pandemic than that of property purchases, the situation has been reversed in recent months. Negative annual rates have been common, and in February of this year they have suffered a further decline of -12.8% in home mortgages, although lower than that of the previous month, the highest in the entire period, when the falls exceeded the 30%. With the specific exception of September, the general evolution of mortgages has practically always remained negative since the beginning of the pandemic“, the Registrars said.

Sales fall again before a predicted rebound in March

On the part of home sales, they also fell -3.7% year-on-year in February, a much smoother drop than that of January, and following the increases registered at the end of 2020. Home sales fell by 1,500 operations, going from 42,028 in February 2020 to 40,482 in February this year.

However, everything suggests that the next statistics for March will be marked by the profound impact of the coronavirus crisis, when in the third month of 2020 the country stopped due to the mandatory confinement decreed by the Government to fight the pandemic, which paralyzed all real estate activity. This could mean a rebound in year-on-year statistics in the coming months.

Looking further at the data for February 2020, seven of the 17 communities had negative data on sales, with decreases in the Balearic Islands (-18.2%), the Canary Islands (-14.6%), Valencia (-12.6%), Aragon (-11.7%), Madrid (-5.1%), Catalonia (-4.6%) and Andalusia (-2.8%). On the other hand, there was a greater increase in transactions in Asturias (16%), La Rioja (13.7%) and the Basque Country (12.9%).

Meanwhile, on the side of mortgages constituted on homes, there were only five autonomies that remained positive. They were La Rioja (69%), Galicia (12.1%), Navarra (9.1%), Murcia (8.6%) and Cantabria (5.9%), compared to the decreases in the other communities, with greater falls in Aragon (-30.2%), Catalonia (-21.8%), Madrid (-17.1%), The Canary Islands (-16.8%), Castilla y León (-14.9%) and the Balearic Islands (-14.6%).