Spanish house prices: 2017 sees Barcelona take pole position

Barcelona is leading Spanish property price growth in 2017, according to new figures.

Tinsa’s latest data shows that the Catalonian city is enjoying the strongest capital growth in the country, with prices up 21.7 per cent in the second quarter of the year, compared to the same period in the year before. The city’s strong growth significantly outstrips the national average climb of 2.7 per cent year-on-year.

The closest cities to enjoy such a strong price increase were Alicante (12.9 per cent), Madrid (10.8 per cent), Viga (10.2 per cent), while the capitals of Castellon, Toledo and Leon led annual declines, with losses of 12.6 per cent, 9.4 per cent and 5.6 per cent respectively.

The stronger price growth is fuelled by a faster moving housing market, as the city draws both local buyers and overseas investors to an area buoyed by a strong economy and a thriving tourist industry. Indeed, the average time it takes for a home to sell in Spain is 9.5 months, as of the second quarter of the year. In Barcelona, on the other hand, it takes just 3.6 months to sell a home, behind only Madrid (3.4 months). The result are buzzing conditions for Barcelona real estate. The district of Ciutat Vella, for example, ​​saw values rise 35.7 per cent in the last year alone.

Despite this improvement, Spain’s recovery remains uneven: there are still markets where price adjustment after the financial crisis has not finished and show lower prices than the same period of the previous year. Overall, prices are 39.2 per cent below the 2007 peak.

According to Tinsa’s national index for June 2017, prices rose 2.3 per cent year-on-year. Capitals and large cities led the way with a rise of 4.6 per cent, ahead of Metropolitan Areas (4.2 per cent).

Prices also rose 1.9 per cent and 1.5 per cent on the Mediterranean Coast and the Balearic and Canary Islands respectively. Areas with smaller populations, though, saw prices decrease 2.6 per cent.

In addition to Barcelona, the Balearics and Canaries have shown “great dynamism” in the first half of 2017, says the valuations firm, with a 7.2 per cent increase in house prices in the six months to June, just ahead of the Capitals and large cities, which have seen their values rise 5.2 per cent.

Read: How is Brexit affecting Spanish property?


Spanish sales and prices on the up

21st April 2017

Spanish house prices climbed in February 2017, according to Spanish Notaries, as sales also rose.

The month saw 38,176 home sales witnessed by notaries, up 10 per cent year-on-year from the previous February. Once seasonally adjusted, the growth is even healthier at 12 per cent, notes Spanish Property Insight. Indeed, the number of loans approved for residential purchase increased 2.5 per cent, with the average loan value up 0.6 per cent to €125,445.

Steadily rising activity is helping to drive up property prices, as the country’s housing market gradually recovers, albeit at differing speeds across the country. Spanish property values rose 2.5 per cent year-on-year to an average of €1,305 per square metre.


Spanish house prices up 1.8pc

10th March 2017

Spanish house prices rose 1.8 per cent in February, according to the latest figures from TINSA.

The valuations firm reports that the Balearics and Canary Islands led the growth last month, with prices up 4.4 per cent year-on-year, while capitals and large cities follows closely behind, with prices up 3.4 per cent.

The latter accelerated in February – over the first two months of 2017, prices have risen in capitals and large cities by 3.5 per cent compared to the same two months in 2016, up from 1.5 per cent in January.

Metropolitan areas and small municipalities saw prices increase 0.2 per cent year-on-year. Indeed, all areas saw values rise on an annual basis in February, with the exception of the Mediterranean coast, which saw values edge down 0.3 per cent.

The figures mark the continued recovery of Spain’s housing market, with the country singled out by experts as one of the top destinations for investors in the coming year. Indeed, house prices in Spain remain 40 per cent below their previous peak. The lowest fall is in the Balearic and Canary Islands (down 27.6 per cent), while the Mediterranean coast continues to be the furthest below the peak (down 48.3 per cent).


Spain house prices heat up in tourist hotspots

13th February 2017

Tourist hotspots continue to be Spain’s hottest markets for house price growth.

New figures from the Mitula Group, published by El Pais, show that property values increased in the last quarter of 2016, with the most popular areas among holidaymakers leading the way. Indeed, the Canary Islands, Valencian Community and the Balearic Islands saw prices climb 2.57 per cent, 1.14 per cent and 0.39 per cent respectively.

In terms of affordability, a family in the Canaries would have to devote all of their income for 8.67 years to afford a home at their current price of €1,477 per square metre. In the Valencian Community, that is slightly lower, at 7.42 years to afford a home at a price of €1,245 per square metre, while the Balearics is much higher, with an average family having to spend 11 years of their income to pay for a flat at €2,076 per square metre.

Tourist destinations tend to be the areas where foreign investment is concentrated, both due to lifestyle appeal and rental income opportunities, and that demand drives up property values. That trend has helped the Spanish housing market to recover in the years since the global financial crisis, although price growth remains uneven from region to region.

Spanish house prices rise 1.7pc

23rd January 2017

Spanish house prices rose 1.7 per cent in 2016, according to Tinsa’s latest national index.

The average value of property in Spain was almost 2 per cent higher in December 2016 than the same month of the previous year, with only the Mediterranean coast bucking the trend. Areas on the coast saw values dip 1.3 per cent, but the Balearic and Canary Islands offeset that slide with price growth of 2.8 per cent year-on-year.

Large cities were close behind, with prices up 2.4 per cent, while metropolitan areas in general saw values edge up by 0.6 per cent.

On average, Spanish property is now 41.3 per cent below the market’s 2007 peak.

The figures highlight how affordable Spanish real estate remains, even as the market begins to show signs of recovery, something that has helped to encourage British buyers in the wake of the UK’s EU referendum, which has seen the pound weaken against the euro.

Speaking to about the outlook for the country in 2017, estate agents Golden Properties highlighted the “immense capital growth potential in the market”, reporting a “major increase in enquiries for Spanish properties under €50,000 from British investors”.


Spanish house prices to continue rising for years to come

21st November 2016

Spanish house prices will continue to rise for years to come, forecasts Knight Frank.

Speaking to Idealista, Humphrey White, head of Knight Frank Spain, predicts that property values will continue climbing for at least the next three years at a steady pace of 5 per cent 6 per cent per annum. That “sustainable” growth will last until 2019 and potentially beyond, he predicts, fuelled by the country’s ongoing economic recovery.

Indeed, Spain is now leading economic growth in Europe, which White heralds as a “unique moment”, and that is helping to unleash pent-up demand for both residential homes and commercial property.

“In recent years there has been very little speculative promotion, which explains why we have an obvious lack of quality stock of some kinds of assets in some areas, and demand that is on the rise,” he tells the site. “[Spain] continues to offer opportunities in traditional sectors like real estate and banking.”

His comments follow Knight Frank’s ranking of Barcelona and Madrid as some of the top 20 cities around the world preferred by the super-rich, with the Spanish capital ranking in seventh place for foreign investment.

Spanish Property Insight

Spain house prices race ahead of Eurozone average

28th October

Spain’s house prices continue to race ahead of the Eurozone average.

Spanish property values climbed 3.8 per cent year-on-year in Q2 2016, according to official figures from Eurostat, above the typical Eurozone rate of 2.9 per cent.

The latest data marks two years of Spain’s above-average growth, marking a significant turnaround from a few years ago, when Spain was at the bottom of the Eurozone rankings.

Eurozone growth overall is led by Hungary and Latvia (both 10.3 per cent), Austria (9 per cent), the UK (8.8 per cent) and Sweden (8.7 per cent). Prices fell, on the other hand, by 1.4 per cent year-on-year in Italy and by 8.9 per cent year-on-year in Cyprus.


Spanish banks forced to cut prices of homes?

27th September 2016

Spanish banks may be forced to slash the prices of repossessed homes this autumn.

Spain’s property market has been enjoying a slow but steady recovery in the last year, with prices stabilising and, in some areas, rising, due to demand from foreign investors and local buyers starting to return to the housing ladder. The country, though, still faces a large of backlog of property, with the banks owning homes from struggling developers and other repossessions.

Now, as part of a strategy to reduce banks’ real estate exposure, the Bank of Spain is putting lenders under pressure to cut the price of their homes. From 1st October, banks will be required to increase provisions against their repossessed portfolios and raise their sales, which can mainly be done by lowering prices.

“The troubled real estate exposure of Spanish banks has risen every year since the crisis started, despite huge write-offs each year, rising to a total of €84bn at the end of 2015,” notes Spanish Property Insight.

While the sell-off of discounted bank repos might mean low-priced opportunities for buyers, though, they may not be in the areas investors traditionally look for, with developments in the Costa del Sol and Barcelona already sold.


Spanish house prices up nine quarters in a row

14th September 2016

Spanish house prices have now risen for nine quarters in a row – and the country’s second biggest bank says that prices are only going in one direction.

House prices climbed 3.9 per cent year-on-year in the second quarter of 2016, according to the National Statistics Institute, slower than the 6.3 per cent growth recorded in the first quarter. New homes saw prices rise 8.4 per cent, while existing homes saw prices rose 3.2 per cent. On a quarterly basis, hosue prices rose 1.8 per cent, the second quarter in a row of growth using that measure.

That growth is only forecast to keep going, according to BBVA.

The bank’s latest research shows that the market had a healthy first half of the year, fuelled by low mortgage rates and high tourist figures. The lender predicts that the market will continue to enjoy positive growth in the future.

“Economic moderation expected for the last months of the year suggests slower growth in housing sales compared to those recorded in the first half,” admits the bank, but expects sales, values and construction to increase, which will, in turn, fuel demand. Indeed, with sales currently rising in discounted conditions, those transactions are forecast to help push up prices.


Land shortage set to boost Barcelona house prices

4th August 2016

A land shortage in Barcelona is expected to boost house prices this year.

Research by CBRE show that the Catalan capital is suffering an acute shortage of land, with most new development activity focusing on refurbishing existing buildings, changing them from offices to residential property, for example. Five projects are underway in the Old Town alone, notes Spanish Property Insight. This is, ironically, because the rate of house price growth makes residential real estate more profitable as an investment than office space.

As a result, property values are expected to climb 10 per cent on average in 2016, says CBRE, with values in Catalonia overall predicted to climb 7 per cent.

Low mortgage interest rates, fuelling a rise in lending, is pushing up demand, too, which is driving prices higher.

Spanish house prices enjoy biggest rise in nine years

23rd June 2016

Spanish house prices enjoyed their biggest rise in nine years in the first quarter of 2016, reveals the National Statistics Institute (INE).

The INE’s latest official figures, reported by El Mundo, show that prices climbed 6.3 per cent in the first three months of the year compared to the same period in 2015, their biggest quarterly increase since Q3 2007. The rise marks the eighth quarter of annual growth in a row.

Existing homes led the way, with prices up 6.4 per cent (again, the biggest rise since Q3 2007), while new build homes saw prices rise 6.1 per cent (the biggest rise since Q1 2008).

On a quarter-on-quarter basis, the start of 2016 also shows a reassuring return to positive momentum, following a 0.1 per cent dip in the final three months of 2015.

All of Spain’s regions saw annual price growth year-on-year, with Madrid enjoying the strongest (9.7 per cent), followed by the Balearic Islands (8.8 per cent). The lowest climbs were recorded in Castilla-La Mancha (1.5 per cent), Castilla y León (1.7 per cent) and Extremadura (1.7 per cent).

Spanish house prices up for sixth quarter in a row

7th June 2016

Spanish house prices have increased for a sixth quarter in a row, according to new figures from the Ministry of Public Works.

The Ministry’s data shows that the average price per square metre of residential property in Spain stood at €1,492.4 in the first quarter of 2016, up 0.2 per cent from the previous quarter and 2.4 per cent compared to the same months last year.

In real terms, discounting inflation, house prices have now risen for the sixth quarter in a row, adds the Ministry.

The Balearics continue to lead the way, with a price rise of 9.6 per cent year-on-year, followed by Catalonia (4.9 per cent), Madrid (4.2 per cent), Extremadura (3.7 per cent), Galicia (2.6 per cent), Valencia (2.4 per cent) and the Canary Islands (2.4 per cent). 12 of the autonomous communities saw price rises annually, with five seeing prices decline, including La Rioja (down 2.2 per cent)), the Basque Country (1.9 per cent), Cantabria (1.3 per cent), Aragorn (0.1 per cent) and Melilla (0.3 per cent).

In total, prices are now 29 per cent lower than the market peak in the first quarter of 2008, with values recovering 2.5 per cent from the trough in the third quarter of 2014.

Spanish house prices edged up in April

24th May 2016

Spanish house prices edged upwards in April.

The average price of new and existing homes rose 0.1 per cent year-on-year last month, according to appraisals firm Tinsa. The increase is lower than the 0.8 per cent and 2.1 per cent annual growth recorded in March and February 2016, but the first four month show an average increase of 1.9 per cent – higher than the 1.4 per cent recorded on average over the first four months.

Prices are now ranked at around the 2003 mark, having fallen 41.1 per cent since the 2007 peak, but the signs of bottoming out show a promising indication of a turnaround.

Indeed, the Mediterranean Coast saw prices rise 4.4 per cent year-on-year in April 2016, although the Metropolitan Areas saw prices remain flat from April a year ago. While Capitals and Larges Cities (0.2 per cent) and the Balearics and Canaries (0.4 per cent) both saw prices dip, the average price in each group is higher than at the end of 2015.

Spanish house prices up for second quarter in a row

15th April 2016

Spanish house prices have risen for the second quarter in a row at the start of 2016.

According to the latest report from Tinsa, the average price of houses in Spain rose by 1.4 per cent year-on-year in the first three months of the year, the second quarter of annual growth in a row.

In a promising sign of the recovery’s building momentum, the number of regions showing year-on-year growth outnumbered those suffering declines for the first time since the crisis began.

Catalonia and Madrid are leading the way, with price rises of 8.2 per cent and 7 per cent respectively, followed by the Balearics (3.8 per cent), Castilla-La Mancha (3.5 per cent), the Canaries (2.3 per cent), Asturias (2.2 per cent), La Rioja (2.2 per cent) and the Basque Country (0.4 per cent). Aragon and Galicia led declines, with prices dipping 3.5 per cent and 3.1 per cent respectively.

Spanish house prices forecast to climb 6pc/h3>
4th March 2016

Spanish house prices are forecast to climb 6 per cent in the coming 12 months, as the market continues to recover.

A new report from CBRE predicts that values will rise 5.95 per cent in 2016, as price growth strengthens across the country and optimism spreads.

Madrid, Barcelona, Valencia and the Balearic Islands are highlighted as the areas set for strongest growth, based on their relative strong performances in 2015. In Q3 of last year, according to the INE, Madrid (6.9 per cent), Catalonia (6.1 per cent), Valencia (6.1 per cent) and the Balearics (8.4 per cent) were the most sought-after parts of the country.

The same three months are expected to enjoy the strongest performance in 2016, with the quarter’s growth forecast at 6.3 per cent year-on-year.

CBRE also notes a 40 per cent rise in resales and 35 per cent in new home sales, as new-build supply dries up in the most popular hotpots, which they suggest puts 2016 on course for both more investment and more construction. Indeed, in Marid alone, planning approvals rose 63 per cent in the first 10 months of 2015, ahead of national increase of 18 per cent.

Investment has been a key driver in the recovery of the country’s real estate in the years since the global financial crisis, with last year, in particular, seeing demand from overseas soar on the back of favourable exchange rates between the pound, dollar and euro. CBRE also attributes the recovery to low interest rates, which have made lending more affordable property more attractive to investors.

Rental investment could also become a growing factor in the market’s recovery in the future, as CBRE highlights the growth of the sector among those unable to afford to purchase a home.

“The rental market is expected to continue to expand in 2016 and the ratio of rented housing (14.9 per cent in 2014) will continue to converge towards the Eurozone average,” says CBRE.