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Last update December 31, 2019

During the first semester of 2019, house sales in Spain have dropped. That occurred due to a slowing down of the economy and a high level of political uncertainty. A positive sign however, is the relatively low interest rate, which enables financing to potential buyers.

Real Estate Market Overview

3rd Quarter of 2019

Average sale value192 mil € *
Transactions made123 588 *
Average value per m21 448 € *
(*) Provisional Data.

Renting prices (published)
50% since 2013 until May 2019(**)

(*) Centro de Información Estadística del Notariado
(**) Boletín Económico 3/2019 Banco de España

Global Analysis

Average housing prices in Spain, during the 3rd quarter, has fallen 6 tenths and stays in 4,7%, according to the National Institute of Statistics (INE). In this period, the existing house prices have fallen 6 tenths related to the previous trimester and are placed at 6,6% and 4,4%, respectively.

Variation of the IPV (House prices index, Spain)

Instituto Nacional de Estadística (INE)

House prices have positive quarter rates in all the autonomous communities. The biggest rises are in the Baleares Islands, Andaluzia and the Basque Country, with rises of 4,5%, 2,1%, and 1,9%, respectively. On the other hand, Extremadura and La Roja have registered the smallest rises, with 3 tenths each.

Quarter IPV rates
General index by communities and autonomous cities. (%)
Intituto Nacional de Estadística (INE)

The economic bulletin 3/2019 of the Bank of Spain highlights that one of the main limitations presentes by the rental market analysis is the absence of an official price index to the new contracts, an index that ideally should adjust the rental prices to take in consideration the characteristics of the rented real estate.

This information gathered on the internet quickly shows us that rental has had a real dynamic regarding its prices, with an increase of 50% since its minimum on the last 3rd of 2013 to its maximum in May 2019. During this same period, the villa prices have grown at a significantly slower pace of 6,8%

In its analysis, the Bank of Spain shows us that the biggest growths have been seen in cities like Barcelona, Madrid or Valencia; and in tourist friendly cities such as Málaga, Palma, Las Palmas de Gran Cana, Tenerife. The smallest rises are noticed in smaller, countryside cities.

It also indicates that one can perceive rental as an attractive investment. The increase of rental rentability and its attractiveness for investment coincides with the arrival of new market operators.

Foreign Investment

According to the Centro de Información Estadística del Notariado, the buy/sale of villas by foreigners decreased 3,2% in the first half of 2019. The non residents comprised 41% of the operations and have fallen around 9,7%. The residents comprised the remaining 59% and have risen 1,9%.

The British with 12,9% continue to lead among foreigners. The highlights are the rise of buyers from Morocco (21,4%), Argentina (12,7%) and the EU (11,3%), and the decrease among Portuguese (-8,6%), Irish (-7,3%) and Italians (-1,3%).

The average price per m2 among foreign operations has grown around 2,5% annually. This growth was bigger for residents (5,8%) than non residents (1,3%) and has kept a higher price for the first, 2099€/m2 as opposed to 1428€/m2 for non residents.

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Mirla Ferreira
In love with finance and technology, Mirla writes about tips & advices at UrbaMarkt, where she is Product Manager. Mom from Sept 1994 until forever.