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Housing foreclosure in Spain: -34% in 2017 to 27.000 units
The annual rate of foreclosure in Spain is 0.1%
The total number of registrations for foreclosure on dwellings initiated in the fourth quarter of 2017 was 2.103 houses vs 4.696 in the same quarter of 2016.
That is what the Instituto Nacional de Estadistica said in its last report.
34.2% decrease for 2017
For 2017, 27.171 properties were foreclosed, i.e. 0.1% of all the properties existing in Spain. According to the census, there are 25m properties in Spain, follow the link and check our table on that.
This is a nice decrease of 34.2% vs the numbers of 2016.
Look at the evolution of foreclosure over the last 4 years.
It is an impressive 3 year in a row decrease since 2014: -34% in 2017, -31% in 2016, -15% in 2015.
Default rate by initiation date
As you can see on this chart, the default rate is the highest and represent about 50% of all defaults for the properties acquired in 2006, 2007 and 2008.
As you can see on our chart, prices were much higher at that time: €2.100 vs €1.559 now.
Most impacted regions
Regions with the highest foreclosure rates for housing are:
- The region of Murcia 0.43%, 3.252 units
- Andalusia 0.42%, 13.644 units
- Valencian community 0.42%, 10.212 units
Foreigners active in the same regions
It could represent a nice opportunity for foreigners as they are active in all those regions. As a reminder, foreigners bought 16% of all transactions during the last year.
Click on the image and get our last report analysing where foreigners are buying real estate in Spain in 2017.
Why are foreclosures decreasing?
The three main reasons are:
- The economy in Spain is stronger: GDP growth close to 3% and one of the highest in Spain, see the sixth “must see chart on the Spanish real estate” comparing the Spanish growth rate with all its EU counterparts. Going in Sync with higher growth, you have a decrease in the unemployment rate as you can see in our table with the economic statistics of Spain.
- Financing rates are very low: check our table on mortgage and financing rates in Spain.
- A final reason was explained above: about 50% of the foreclosures are mortgages that were initiated in 2006, 2007 or 2008. Right now, we are 10 years later and so people could adjust in the meantime on one side and on the other side, as prices are much lower, people are taking a much more “calculated” risk.
Do you want to check what is on the market right now?
Do you want to have a look at properties repossessed by Spanish banks? Have a look at our study on that subject: Spanish bank repossessions: Your ultimate guide to 120.000 properties