Lower prices, slower growth, fewer real estate transactions – does all this mean that the housing market in Spain is in a new crisis? All this is worth looking into to understand that there is no need to be afraid of another crisis – the boom that came after it was simply replaced by stability. Let’s look at the results of 2019, having considered the indicators with which the real estate market closed last year. The situation in the sale of secondary property and indicators of the market for new buildings – the main criteria for assessing the real estate market in the country. On both parameters in 2019, there was both growth and decline.
New construction – housing more and more, prices are stabilizing
On the one hand, prices for new housing last year showed a steady increase – on average, they rose by 4.5% over the year. On the other hand – this figure is lower than the one registered at the end of 2018 – then the price increase was 5.4%. The slowdown in price growth in this sector hints at stabilizing this market. This assumption is also supported by the general indicator – the construction sector continues to grow. The crisis of the construction sector is far in the past, as experts believe. Most new construction projects are in Madrid, Andalusia and Catalonia (mainly in the surrounding area and Barcelona itself). In 2019 there was also a new record in this area – in January, 9259 new construction projects were sold the most in the last 5 years.
Secondary real estate in Spain – mortgage did not let down
Portal Idealista reports that at the end of 2019 the secondary Spanish property rose in price by 4.6%. One meter of housing, on average, is about 1763 euros in Spain. Despite the fears that followed the adoption of a new mortgage law on its negative impact on the market, according to the results of 2019, compiled by portal Fotocasa, 73% of all properties were acquired in the mortgage. The elite real estate sector has also shown growth. The number of deals for properties worth starting from €900,000 grew by 40% and their average value grew by 27% to about €2.1mn. The Golden Visa program is well attended by foreigners, and most of the deals with luxury real estate were made within its framework.
Who bought housing in Spain in 2019?
In the third quarter of 2019, 41% of all real estate transactions in the country was carried out with the participation of foreigners. As before, the most popular destination – the sea coast and the cities located on it – Estepona, Marbella, Malaga, Almeria, Torrevieja, Alicante and others. The greatest contribution to the Spanish real estate market in the past year have made the British, French and Germans, with which were made more than a third of all transactions with foreigners.
Price dynamics in the regions and the most expensive directions
In 2019, property prices decreased in only 5 regions: Asturias, Galicia, Castille and Leon, Castille-la-Mancha and Extremadura. The Cantabria region did not show any dynamics. Prices rose in the rest of the country. The largest increase was shown by real estate prices in Andalusia (+8.8%), the Balearic Islands (+ 6.6%), the Canary Islands (+5.2%). In other regions of Spain, property prices rose by less than 5%.
The most expensive real estate in Spain is in the Balearic Islands, where the cost per square meter is about 3060 per m². Second place is occupied by Madrid with the cost per square meter of about 2805 euros, followed by the Basque Country – 2581 euros, in fourth place Catalonia – 2281 euros. Closes the top five Canary Islands with a price of a meter of housing about 1,826 euros. If you want to explore real estate by the sea more closely, you can rent an apartment on this website https://yes-mallorca-property.com/offers/rent/.