Spanish Property demand from non-residents continues to soar, with growth among non-resident buyers already twice that of domestic buyers. If current trends continue, the market will see lending to international customers exceed 8% of the total market by 2027 and within 10 years, non-resident mortgage applications are predicted to grow by 300%.
Despite significant growth in interest and transactions from overseas buyers, the market is still experiencing low mortgage attachment rates. Many buyers opt to refinance with their primary bank and make cash purchases. This means, while 66% of property transactions by Spanish residents are mortgage-funded, this number drops to 31% for non-resident transactions.
Spanish mortgage lenders are not adequately prepared to take advantage of this growing demand. The market remains insular, with banks and lenders focusing only on the needs of Spanish buyers. The result? They are missing valuable growth opportunities.
Capturing the non-resident opportunity
Historically, language barriers, document translation and complex application and approval processes have deterred non-resident buyers. From a bank’s perspective, the current origination process lacks traceability and control. It involves a high level of manual tasks, data management is inefficient and communication is poor. This makes it difficult to manage applications cost-effectively.
Creating a more streamlined mortgage origination journey is, however, more straightforward than many lenders think, with platforms like the Credit Logic Origination Platform. This empowers applicants, advisors, and credit controllers with seamless digital experiences to accelerate approvals, reduce costs and enhance competitiveness.
To be successful, lenders must cater to the digital-first demands of non-resident buyers and make services more accessible and customer-friendly for non-Spanish nationals.
They must provide:
- A digital-first offering: Overseas buyers don’t have the same opportunity as residents to meet with lenders face-to-face. Instead, they’re more likely to research and apply for mortgages online.
- Frictionless applications: Non-resident applicants want to know what’s expected of them, what products they qualify for and where they are in the process.
- Multilingual capabilities: The loan application process and documentation should be facilitated in a dual-language format to enhance clarity and efficiency for both the applicant and the lender.
Trends and Predictions
Over the next 10 years, we expect a surge in non-resident mortgage applications in Spain. Lenders must, therefore, act now to integrate platforms that accelerate this digital transformation.
Low mortgage attachment rates show a need for lenders to adapt and upgrade processes. Tearing down language barriers, streamlining application processes and improving digital offerings are the most significant changes to attract non-resident buyers. This is key to competing with lenders in buyers’ home countries.
While these steps can help lenders capture non-resident buyers within the EU, the non-EU cohort is facing uncertainty when looking to buy property in Spain. In January 2025, the Spanish government proposed the implementation of up to 100% property taxes for non-EU buyers. If introduced, this could greatly impact the desire of non-EU residents to buy property in Spain as non-EU residents purchased around 27,000 homes in Spain in 2023.
While the new regulations are still in the early stages of discussion, this highlights a need to focus on winning over non-resident EU buyers, as the audience of overseas buyers will potentially shrink.
Looking for more insights into the Spanish non-resident mortgage market? Explore the latest trends and future projections in CreditLogic’s report, Unlocking Opportunities: Non-Resident Mortgages, a growth opportunity for lenders in Spain.
About CreditLogic
Designed and built by bankers, CreditLogic is a mortgage origination platform that can be implemented without disruption. It has already cut processing times for major lenders in the Irish market by 90% and costs by 50% within the first few weeks of use.
As a strategic partner for growth and innovation, CreditLogic can streamline the mortgage application process for both non-resident and resident buyers, helping reduce costs and increase conversions in both segments.
