Getting a mortgage in any country can feel incredibly stressful, but getting a mortgage in Spain can feel even more stressful if you’re not sure what to expect or what the process will involve.
According to Spain's Council of Notaries, currently five out of ten houses bought are paid for immediately in cash. But the other 50% of property buyers in Spain will need to secure a mortgage. But how much money to do you need to get a mortgage in Spain? Is it possible to get a mortgage in Spain if you have a low income? And which are the most and least expensive provinces in Spain to live in?
Here’s everything you need to know:
How Do You Get A Mortgage In Spain?
Securing a mortgage in Spain is a process that involves a lot of paperwork. But one of the main things your lender will take into consideration is how much you earn. They will want to know that you have enough income to cover your monthly mortgage payments.
Most mortgage experts, and mortgage lenders, suggest that you monthly mortgage payments should not exceed 30 percent of income. So, if you make €2,000 net per month, your monthly mortgage payment should not be more than €600 per month.
You will also stand a greater chance of getting a mortgage the more healthy your savings account is. Most Spanish banks ask that mortgage holders have at least a 20 percent deposit for their property, then they will lend you the remaining 80%. But some would-be Spanish homeowners manage to save a much bigger deposit than this, and that does give them more options when it comes to finding a lender.
Any existing debts you have will also be taken into consideration. Your application can be harmed by things that you otherwise think are inconsequential, such as a missed or late phone bill payment.
So How Much Do I Need To Earn?
The amount you will need to earn will vary from lender to lender and the value of the property you wish to purchase. One study conducted in Spain found that €38,400 is the average annual gross salary necessary to get a mortgage to buy a house or apartment of 100m² in Spain in 2023. But like so many things in Spain, geographical differences will pay a huge role in the answer to this question.
The Balearic Islands are the most expensive places to get a mortgage and you will need a salary of €135,770. Ciudad Real is the cheapest place to get a mortgage and you will need a salary of €14,500.
The areas where you will need the highest salary to secure a mortgage in Spain are:
Balearic Islands (€2,466/month and annual gross of €135,770)
Guipúzcoa (€1,664/month and annual gross of €89,000)
Madrid (€1,596/month and annual gross of €80,900)
Barcelona (€1,424/month and annual gross €72,000)
Cádiz (€1,346/month and annual gross €67,200)
Girona (€1,237/month and annual gross €66,500)
Vizcaya (€1,339/month and annual gross €66.100)
Málaga (€1.305/month and annual gross €64.700)
Santa Cruz de Tenerife (€1,163/month and annual gross €56.600)
Seville (€1,132/month and €55,200)
By contrast, the areas where you can get a mortgage with the lowest salaries are
Ciudad Real (€388/month and gross annual €14,500)
Jaén (€430/month and gross annual €17,400)
Cuenca (€407/month and gross annual €17,900)
Ávila (€458/month and gross annual €19,100)
Toledo (€465/month and gross annual €19,400)
Teruel (€479/month and gross annual €20,200)
Cáceres (€482/month and gross annual €20.500)
Zamora (€503/month and gross annual €21.250)
León (€515/month and gross annual €21,900)
Badajoz (€514/month and gross annual €22,200)
What Is The Biggest Factor In Deciding The Salary You Will Need To Buy A Property In Spain?
The biggest factor in determining whether or not you can secure a mortgage for a property in Spain is the price of the property you are buying. And there is a huge disparity in purchasing power in Spain depending on where you live, with property price per m2 varying wildly. Understanding where you'll pay more per m2 is important for your house hunt and, crucially, getting approved for a mortgage. It makes sense that the cheaper the location is, the more likely that you’ll be able to secure a mortgage.
If we’re looking at the price per m2 in Spain then the most expensive provinces right now are:
Balearic Islands - €3,954/m2
Guipúzcoa - €3,394/m2
Madrid - €3,142/m2
Vizcaya - €2,728/m2
Barcelona - €2,695/m2
Cádiz - €2,596/m2
Málaga - €2,516/m2
Girona - €2,339/m2
Santa Cruz de Tenerife - €2,307/m2
Álava - €2,284
Cheapest provinces per square metre of property
The ten cheapest provinces per m2 in Spain are:
Ciudad Real - €750/m2
Cuenca - €786/m2
Jaén - €825/m2
Toledo - €849/m2
Ávila - €870/m2
Teruel - €912/m2
Cáceres - €918/m2
Zamora - €958/m2
León - €979/m2
Badajoz - €982/m2
If you’re looking to buy a property in Spain and you have a relatively low income, but you have savings available for a property deposit, then it is possible to secure a mortgage. You’re more likely to achieve your goal if you look for property in regions where the price per m2 is lowest, and if you have a reliable credit history that will show the potential lender that you are reliable and responsible.
Are you thinking of moving to Spain? Or looking for a holiday home that you can let when you’re not using it? Then why not get in touch with our locally based property experts, who are perfectly placed to help make you dream of Spanish home ownership a reality. We’re already excited to work with you!