Spain became the first European country to introduce a mortgage moratorium for the unemployed yesterday in a move that could put pressure on neighbouring countries to follow suit.

Jobless workers and pensioners with families to support will be allowed to delay half their mortgage payments for up to two years under a government proposal. José Luis RodrÍguez Zapatero, the Prime Minister, said the moratorium could apply to up to 500,000 families. “The Government’s priority is assisting those in most difficulty,” he said.

The Government will guarantee payments postponed under its moratorium – the maximum eligible mortgage will be €170,000 (£136,000).

Mr Zapatero also announced a €1,500 subsidy for companies to hire workers with families as part of a €170 million package to stimulate the labour market. Unemployment in Spain hit a four-year high of 2.6 million, or 11.3 per cent, in the third quarter – the highest rate in the eurozone.

According to Bank of Spain figures, the bad loan rate rose to 2.44 per cent of total outstanding credit in August, from 2.14 per cent in July.

The moratorium came as the European Commission cut its forecast for the Spanish economy next year, saying it would shrink 0.2 per cent. Average EU growth slowed to 0.1 per cent.

Analysts were sceptical the plan could make any real difference. Nicolas Lopez, head of analysis at the brokerage M&G Valores, said: “The numbers [in terms of money] are moderate, so I don’t think this will have a big impact on companies and markets.”

Other measures to tackle the crisis have included a €38 billion fiscal stimulus package, the creation of a fund worth up to €50 billion to buy assets from the banks and state guarantees for up to €100 billion in new bank debt both this year and next.

One of the main causes of rising unemployment has been the collapse of the construction industry, the driver of Spain’s decade-long growth. Since the building bubble burst, a stream of companies have filed for bankruptcy or have gone into administration, the most high-profile being Martinsa Fadesa, Spain’s biggest developer. The gloom spread as house sales fell by 36.8 per cent in August compared with the same month last year. Mark Stucklin, who runs the website propertyinsight.com, said: “The market is dead because banks are not lending. Things are not as bad as in the UK but there is negative equity.”

Mortgage lending fell by 42.3 per cent in September from a year earlier, according to the Bank of Spain. Financial institutions lent €5.2 billion in September compared with €9.09 billion a year earlier. Against this background, Spain’s financial sector has proved more robust than other European neighbours, thanks to greater regulation by the Bank of Spain. Banco Santander and Banco Bilbao Vizcaya Argentaria have so far weathered the storm. BBVA’s third-quarter net profit rose by 5.6 per cent to €1.49 billion from €1.41 billion. Santander said that profits rose 4.3 per cent.

However, Manuel Romera, of the Spanish Institute of Companies, said: “The level of debt is growing. This will definitely result in mergers.” Two small savings banks, BBK and Kutxa, joined forces last week, citing financial pressures.

Times Recommends

• Banks to defy Government and raise mortgages rates
• UK services sector plummets to new low
• ITV warns Christmas advertising will fall 9%