Not really a cash purchase in the true sense of the word though, only for the person you are buying from.
Lets say the average mortgage in the UK lasts around 25 years, we know many are going to 30 and 35 years, but use the 25 years, lets say you have an outstanding mortgage of £150,000, and not counting some areas of England vary so differently in house prices, and your house is worth £250,000, the house of your dreams in Spain is selling for 80,000€ and you get the extra money to fulfill this dream. You could / might win over the 25 years if you keep both and never sold until the loan finished. Truth is not many do keep to the 25 year loans, for many reasons personal or otherwise. Still has to be paid back whatever.
You now got a house in the UK with a mortgage attached to it of £230,000 that is worth £250,000, and the corresponding extra amount of repayments every month. Plus extra life insurance to cover the outstanding amount of debt.
The Bank of England has appointed a new Governor, just because of what he says now..today...might not what he does in two years time, and should things pick up quicker then this he will change his mind, they do.
Your house in Spain might still drop a touch more yet, but you will still owe the £230,000, your UK mortgage might go up which in effect is also on a house that may have dropped in price in Spain. Will the UK house drop in value?
The house you bought in Spain hasn't cost you 80,000€ because you paid mortgage interest on it for any remaining term or extended term of your mortgage, in reality this 80,000€ would probably be about 130,000 / 140,000€ at the end.
What i have said in answer to you is only a fraction of what could happen, to many if's..but's...maybe's... mights...
I have not covered the many other scenarios that are out in the real world... such as losing your job...your health...divorce...what you don't seem to lose in this world is the paying back.
I wont even mention buying a Motor home/Car/Boat and obtaining a loan for these via your house mortgage, now that is crazy, paying back money over a mortgage term..say the 25 years... that will increase the monthly payments increasing the initial cost of the purchase.... while the item you bought drops through the floor in value.
For many this is the only way they can afford the dream......what they cannot afford later is the nightmare.
If this is your dream...Then go for it....Why not?