Paying for a property in full, or “cash payment,” has become an increasingly popular trend in recent years. Although not everyone can afford it, more people are choosing this option to avoid the high interest rates and stricter mortgage conditions imposed by banks. According to a Fotocasa study, 35% of Spaniards purchased property without seeking financing in 2024, up from 32% in 2023 and 27% in 2022. But how do they manage it?
Of this 35%, 17% used their own savings, 10% relied on family support, and 7% funded the purchase after selling a previous property. This shift is largely due to the rising interest rates from the European Central Bank, prompting many buyers to seek alternatives to avoid the high costs associated with mortgages.
Profile of Buyers Without a Mortgage
The typical cash buyer is predominantly a woman (56%), with an average age of 49, living with a partner but without children (39%). Additionally, 29% of these buyers belong to the upper-middle class. Half of those who buy without a mortgage (49%) already had enough savings, while only 10% had to take out a loan to cover initial costs like notary fees, taxes, or the down payment.
Most Still Need Financing
However, 66% of buyers still require a mortgage to become homeowners. Of these, 54% obtained only bank financing, while 12% needed additional family help to complete the purchase. On average, those who take out a mortgage are 42 years old, and 36% live with a partner, while another 36% live with their partner and children. The upper-middle class is also well-represented among these buyers, with 40% belonging to this group.
Future Market Outlook
Although cash purchases have gained momentum, experts predict that this trend will not be long-lasting. With recent interest rate cuts by the European Central Bank and the potential for more reductions by the end of the year, mortgage signings are expected to pick up again. These rate cuts could make bank financing more attractive, reigniting competition among lenders to offer more affordable loans and draw in new buyers.
Buying with Cash or a Mortgage? Living Sitges Advisors Will Help You
Whether you choose to buy your home outright or through a mortgage, at Living Sitges, we have a team of specialized advisors ready to guide you through each step of the process. Our goal is to ensure you make the best possible decision, tailored to your needs and circumstances. We’re here to help you achieve your dream of owning a home in Sitges!