Mortgage Activity in Alicante Strengthens Amid Higher Rates
Mortgage issuance has continued to rise in the latest period, even as higher interest rates push monthly payments higher for many borrowers. New data from INE released this week shows that in November residents of the province obtained 1,735 housing loans, demonstrating an 17.8 percent year‑over‑year increase. This reflects a sustained dynamism in the local real estate market, with activity not only rebounding from previous slowdowns but also pressing deeper into the year’s end.
The Alicante market has shown signs of momentum that analysts noted last year when they warned that activity would peak toward the end of 2022. The recent data confirm a continued resurgence in demand, with buyers adjusting to financing conditions and lenders recalibrating how much credit they are willing to extend. In November the volume of mortgages issued reached its highest level since 2010 in the INE historical series, and the average loan amount requested by buyers rose as well. Where a year earlier buyers in Alicante typically asked banks for around 106,860 euros, November figures show the average loan approaching 113,325 euros, signaling growing buyer confidence alongside higher prices per square meter in the same period.
In the broader year-to-date view, the accumulated volume of mortgage transactions registered in 2022 has already surpassed prior years, reaching 18,114 transactions and marking a 10.4 percent increase from the previous year. The value of new mortgage financing in the province also rose, by about 14.7 percent compared with 2021, underscoring a resilient lending environment and robust demand for housing finance in the region.
Within the national context, INE notes that the mix of fixed versus variable rate loans shows a clear tilt toward fixed-rate mortgages in 2022. About 63.4 percent of new home loans were for fixed interest rates, reflecting a preference for predictable payments amid rising costs. The record indicates that lenders also introduced mixed mortgage structures in which the initial fixed tranche was followed by variable payments in later years. The average initial rate was around 2.55 percent, illustrating the evolving landscape of borrowing as lenders balance risk and affordability for borrowers in a higher-rate environment.
Locally, in Alicante, November saw a 10.8 percent year-over-year rise in the number of housing loans granted, with growth that outpaced the national average. This suggests that the province’s housing market remains comparatively buoyant, supported by continued demand and by lenders who are adapting products to reflect the current financing climate. Overall, the data imply that affordability and access to credit remain important drivers of activity in Alicante, even as interest rates continue to exert upward pressure on monthly payments for new borrowers.