The mortgage firm slows down in October despite registering the lowest interest rate since the beginning of 2023

The granting of mortgages cooled slightly in October, although without losing its strength. According to data published this Wednesday by the National Institute of Statistics (INE), in the tenth month of 2025 52,198 loans were signed for the purchase of a housing, the highest volume for the month of October in 16 years but just 0.6% more than last year at the same time. This slight increase was enough to keep the market in positive territory, despite slowing the growth rate compared to previous months. The average interest rate also continued its de-escalation and recorded its lowest level since the beginning of 2023.

It is about the sixteenth consecutive month in which it increases in year-on-year terms the total volume of mortgages granted. The signing of loans to purchase a home has been experiencing increases month after month in the middle of last year, when the European Central Bank (ECB) began cutting interest rates and the real estate market was reactivated due to improved access to financing. In July of this year, the institution led by Christine Lagarde paused the cuts. However, the ECB’s change of script has not prevented the granting of mortgages from continuing to increase, although it is doing so at a slower rate than in the first half of the year, which points to a stabilization of the market.

So far in 2025, all year-on-year increases in mortgage signing had exceeded 10% – in May 54.4% more loans of this type were even granted than in the same month of 2024 – except for increases of 7.5% in August and 4.3% in February. Now the 0.6% rebound registered in October is also added below these marks, the least pronounced of the increases in the last year and a half, although it occurs on the reference of a tenth month of 2024 in which this type of operations skyrocketed by 61.9% compared to the previous year.

In fact, the 52,198 subscriptions in the tenth month of 2025 represented the highest volume of signatures for the month of October since 2009when 52,250 loans were reached. This is, therefore, a level of activity not seen in 16 years. In the first ten months of 2025, 419,913 mortgages were granted, 18.4% more than in the same period of 2024, at a rate of about 40,000 monthly operations. It is the first time since 2010 that 400,000 signatures have been exceeded in this period of time and October is so far the month of 2025 with the most loans granted, exceeding the 46,120 in September by 13.2%.

“We are facing an extraordinary figure. October is always a strong month, but this data confirms that The mortgage market is in a moment of enormous activity“, assesses the general director of Trioteca, Ricard Garriga, who points to the stabilization of the market at unprecedented levels in more than a decade. “Exceeding 500,000 mortgages in 2025 would be a very clear sign of normalization and strength of the market, despite the context of high housing prices,” he adds. At the same time that the mortgage firm has grown, between January and October 601,543 homes have been sold in Spain, a 12.3% more than last year.

“The current context of more flexible monetary policy, which makes credit cheaper and improves financing conditions, has reactivated demand,” confirms María Matos, Director of Research at Fotocasa, who emphasizes that the market is going through a “golden stage” although she points out that the stabilization of interest rates may moderate the signing of mortgages in the coming months. “If the Euribor maintains its trajectory, it is foreseeable that banks will leave behind the strong commercial competition shown in recent months and will bet on more prudent products. This scenario could slightly moderate the pace of sales in 2026 to an average of 40,000 operations per month,” he predicts.

10% more expensive

According to data published this Wednesday, mortgages granted in October had an average interest rate of 2.81%, the lowest since January 2023. The average rate has thus chained four consecutive monthly decreases after a first half of the year stagnant at around 3%. The difference between fixed and variable rate mortgages is very small. The former registered an average rate of 2.82% and were the majority – 61.3% of the loans granted in October for the purchase of a home were at a fixed rate -, compared to 2.79% at the beginning of the latter.

“The fixed mortgage is still the queen. The INE data speaks of 38% of variable mortgages, but that also includes mixed mortgages. In practice, the real weight of the pure variable is much lower,” points out Garriga, who sees as “good news” the fact that the average amount of mortgages has fallen slightly compared to September, despite having grown by 10.4% in the last year driven by the rise in prices.

The average loan is now around 167,080 euroswith a repayment period of 26 years, one more than last year. “Although this year’s mortgage conditions are more favorable, they may not be enough to compensate for the sharp rise in market prices,” acknowledges Matos, pointing out that “buyers have access to more affordable financing, but will have to face increasingly higher purchase prices.”