Mortgage foreclosures in Spain fell 37.8% in 2017, data shows

Homeowners in Spain are more secure financially, and have more favourable, manageable mortgage terms than in the past.

A foreclosure on a mortgage can be a devastating thing. There are no winners when a homeowner can no longer keep up the repayments on their property, because very rarely is the reason for this solely the blame of the individual…

Mass foreclosures speak of wider economic ills, or financial mismanagement at a national scale. Indeed, many economists are sure that it was the subprime mortgage crisis of the USA in 2007-08 that precipitated the global economic crash. When it emerged that average Americans had been largely mis-sold the dream of home ownership on a massive scale, the whole structure of credit-based trust that had underpinned the property industry up to that point came tumbling down.

In Spain, the fallout was dramatic, leaving thousands of people jobless, then homeless, then in severe debt to the banks; banks that suddenly became the largest landlords in history, saddled with overpriced homes that nobody could afford to – let alone want to – buy.

That was then, but today is a different, happier time. While foreclosures are unlikely to disappear altogether, the fact that 2017 saw a 37.8% reduction in the amount of foreclosed mortgages in Spain is extremely encouraging indeed.

It is a reduction that speaks of rising job security, improving wages, a more sober, sensible but confident banking industry, and a property market that has learned from the lessons of the past and enacted a series of checks and balances to ensure that growth is maintained at a stable rate.

The data from the Spanish judiciary reveals just over 30,000 foreclosure proceedings were initiated last year, which is the lowest number since 2008 – the year of the economic crash. This figure is a third of the amount seen in 2009 and 2010, when Spain’s courts dealt with a massive 93,000 foreclosures in both of those years.

And even more encouraging is the reduced number of evictions enacted: in 2017, just 22,330 homeowners were handed eviction notices due to failure to maintain mortgage repayments – a decrease of 15.4% on the previous year.