Categorized | International

Struggling Housing Market Hurts immigrants in Spain

Please Share!

Spain’s housing market continues to fall into a deep decline, as residential real estate properties continue to fall into foreclosure. While the impact of the real estate crash in Spain is, without a doubt, affecting the nation as a whole, those that are immigrants in Spain appear to be hurting the most.

 

From 2006 to 2008, a wave of millions of immigrants came to Spain, and purchased homes. Spain seemed to be an area of great opportunity. However, the residential real estate crash quickly changed that perspective, and many of those same immigrants that invested in homes during the boom are defaulting and facing foreclosure. Recent data has shown that foreign residents are far more likely to default on their mortgage loan than domestic citizens of Spain.

 

Spanish banks have cut back on new lending in the wake of the crash, hoping to cut back on their growing losses. Because foreign residents are far more likely to default on their homes than citizens, many banks are turning them away without even the slightest consideration for a mortgage loan. With Spain’s unemployment level remaining high and housing prices falling off the charts, lenders are afraid that foreign residents will simply abandon their homes. Such a situation would bring about even more losses.

 

Spain’s unemployment has increased to nearly twenty-three percent. There are nearly one million more unemployed foreign residents in the country than there were just five years ago. As such, many are not able to keep up with their mortgage payments, and have no choice, but to default on their home.

 

Please Share!

About Nancy Raven

Nancy is the main writer for the International section of the website. Sometimes she also helps Drew out on the Finance/Mortgage section as well.

Leave a Reply

Twitter Chat