Spain’s govt to guarantee 20 percent of mortgages for young people and families

Get real time updates directly on you device, subscribe now.

Spanish Prime Minister Pedro Sánchez announced this Sunday May 7th the creation of a new type of aid through Spain’s Official Credit Institute (ICO) to guarantee 20 percent of the mortgage of a first home for some young people and families with children.

It will be available for all those under the age of 35 with an annual income less than €37,800 gross and for families with children under their care, providing that they haven’t bought a property previously.  

Sánchez has claimed this new measure is a response to the “housing emergency” and that it will be approved by the Spanish Cabinet on Tuesday May 9th.  

READ ALSO: How Spain’s new housing law will affect you if you rent

FotoCasa, one of Spain’s largest online estate agents, states that six in 10 young people in Spain between the ages of 18 and 34 have tried to buy a property, but without success.

The Emancipation Observatory of the Spanish Youth Council (CJE) has also revealed that in Spain 59.2 percent of young people rent, while only 17.4 percent own their own property and pay a mortgage. Data shows that most Spaniards aren’t able to buy their own property until they are 41 years old. 

The new aid will essentially allow those in need to get up to 100 percent of the mortgage as many banks will only offer up to 80 percent financing. In this way, young people and families will find it a lot easier to buy their first home as they will only have to pay the sales taxes, which costs around 10 percent of the price of the property. 

The measure is similar to the one that regions such as Madrid, Murcia and the Balearic Islands have already approved for their citizens.

READ ALSO: Ten ways under-35s in Spain can get help to buy a home

According to FotoCasa, it’s estimated that the scheme will help around 16.6 million people in Spain.


The main requisites for this aid are:

  • Be under 35 years of age at the time of purchase or be a family with dependent minors (no age limit)
  • Have an income of less than €37,800 per year per person. Up to €75,600 if there are two buyers together. (Note: the income could be higher if there are dependent children).
  • Live in Spain and have a DNI or NIE
  • Have an income and a financial profile suitable to apply for a mortgage.
  • The house you want to buy does not exceed the maximum price specified for this aid.
  • This is your first home and it will be used for habitual residence.  


Some details still have to be released and it is not yet known when people can start applying for this benefit. More information will be revealed when the plan is approved by the Spanish cabinet on Tuesday, May 9th.

Loans and guarantees from the National Credit Institute may be requested at any of the affiliated banking entities that collaborate with the ICO. 

This means it’s likely that the aid can be requested directly from your bank if it collaborates with the ICO, according to FotoCasa. There are currently some 30 banks that offer ICO loans and guarantees.

READ ALSO: What happens if you can’t pay your mortgage in Spain?

Spain’s housing policy is currently a hot topic, after the recent approval of the new Housing Law or Ley de Viviendas

Sánchez believes the problem of access to housing in Spain will be solved by increasing the number through the construction of subsidised housing, with the aim of making it at least 20 percent of the total housing stock.

Sánchez has specified that 300 of the 20,000 subsidised homes will be built on land owned by the Ministry of Defence, by an agreement that will be signed next Tuesday in Santa Cruz de Tenerife.

“We are going to put housing at the centre of our priorities”, Sánchez stressed, after announcing the measures, which he considers necessary when young people and families in Spain “have difficulty when they go to a bank to get a mortgage and buy their own home”.