Spain is intensifying efforts to help young people access housing, rolling out an innovative policy designed to ease entry into the crowded real estate market. The plan includes government backing for up to 20% of the mortgage value, a feature that has sparked strong interest among first-time buyers and young homeowners seeking affordable paths to home ownership.
This government measure could reshape how young people purchase their first homes. It aims to support funding for purchases and lower typical entry costs. The youth mortgage assistance, already in effect in Madrid, Murcia, and the Balearic Islands, is expanding nationwide with the goal of benefiting millions across Spain.
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The new mortgage help for young buyers
As reported by real estate portals, the government will act as guarantor for up to 20% of the mortgage through a line of credit from the Official Credit Institute ICO. This means buyers can secure a 100% mortgage with government backing for up to 20% of the loan. The result is that young buyers would need to save only 10% of the total home price for the down payment, rather than 30% in the past. Cited: Government of Spain.
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To illustrate how the guarantee works, consider a young buyer aiming to purchase a house for €100,000. Previously, the buyer would have needed to save €20,000, in addition to other costs such as entry taxes. With the 20% government guarantee, banks can loan the full price, allowing the buyer to save only on the sales-related taxes and costs, which typically amount to about 10% of the house price. Cited: Government of Spain.
New mortgage help for young buyers — photo of a house
Requirements to get a state guarantee for a mortgage for youths
To qualify for this youth mortgage benefit, several conditions apply. These include being under 35 at the time of purchase, having an income below a defined annual limit, and living in Spain with valid identification. The home must also fall within price caps set for the aid and must be the first residence used as a habitual home. Cited: Government of Spain.
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When two people buy together, both must meet the eligibility criteria to access the 20% ICO guarantee. If one party fails to meet the conditions, they cannot benefit from the government guarantee. Cited: Government of Spain.
How to apply for youth mortgage assistance from the government?
Frequent questions about the youth mortgage program and the application process will be addressed in detail in a forthcoming government update. The measure is expected to be approved by the Council of Ministers, with additional guidance provided for prospective buyers and lenders alike. Cited: Government of Spain.
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The moment is significant for young people in Spain. The introduction of youth mortgage assistance promises to open doors for those who previously found homeownership out of reach and could help lay the groundwork for long-term financial security. Cited: Government of Spain.
Deadline to apply for youth mortgage assistance from the government
The official application dates have not yet been announced. The measure is anticipated to be approved by the Council of Ministers on a forthcoming date, after which approved applicants can approach banks participating with the ICO to apply for the guarantee. It is estimated that around 30 banks currently offer ICO loans and guarantees. Following the same pattern as regional programs, future buyers are likely to apply for this guarantee directly through their banks if they collaborate with the ICO. Cited: Government of Spain.
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Related housing programs exist, but details are still being finalized. It is expected that assistance will cover both new and second-hand homes under official or market protections, following guidelines established in other autonomous communities. Cited: Government of Spain.
Do I have to repay the guaranteed amount from the government for my mortgage?
Regarding repayment, this program serves as support rather than a grant. Buyers must repay the funds claimed on the mortgage, including the government’s 20% guarantee. Cited: Government of Spain.
What if the government-guaranteed mortgage cannot be paid?
If repayment fails, the guarantor bears responsibility, with the government able to recover the debt and any statutory interest in line with civil code provisions. The announcement marks a pivotal step toward easing housing access for Spain’s youth and could become a key factor in opening doors to homeownership and future stability. Cited: Government of Spain.