12-month Euribor, the base rate used to calculate interest payments on most mortgages in Spain, came in at -0.339 on average in September compared to -0.166 the same time last year, so more than twice as low as it was a year ago.

As a result, borrowers in Spain with annually resetting Spanish mortgages based on Euribor will see their repayments fall by around €9 per month for a typical €120,000 loan with a 20 year term.

Euribor has now been in negative territory since February 2016 as a result of the ECB’s loose monetary policy intended to keep the wheels from spinning off the Eurozone economy. Every time rates start to creep up the Governor of the European Central Bank, Mario Draghi, steps into announce that monetary policy will be kept loose for the foreseeable future. Nobody knows how this will end, but negative interest rates are here to stay for now.

Mortgage lending volumes in August 2019

Provisional data from the Association of Spanish Notaries shows new residential loans up 2.3% to 15,859 signings in August with an average value of €133,116, up 4.6%, with more than 50% of buyers now taking a mortgage, up from 30% in 2013.