diff --git a/lib/spack/spack/repo.py b/lib/spack/spack/repo.py
index 00928d84b6..26780e1b8a 100644
--- a/lib/spack/spack/repo.py
+++ b/lib/spack/spack/repo.py
@@ -1138,9 +1138,6 @@ def create_repo(root, namespace=None):
             config.write("  namespace: '%s'\n" % namespace)
 
     except (IOError, OSError) as e:
-        raise BadRepoError('Failed to create new repository in %s.' % root,
-                           "Caused by %s: %s" % (type(e), e))
-
         # try to clean up.
         if existed:
             shutil.rmtree(config_path, ignore_errors=True)
@@ -1148,6 +1145,9 @@ def create_repo(root, namespace=None):
         else:
             shutil.rmtree(root, ignore_errors=True)
 
+        raise BadRepoError('Failed to create new repository in %s.' % root,
+                           "Caused by %s: %s" % (type(e), e))
+
     return full_path, namespace