HE housing prices It increased more in communities that received more tourists than in those that did not. Especially, The price of these regions with a touristic componentAndalusia, the Balearic Islands, the Canary Islands, Catalonia, the Valencian Community and the Community of Madrid, increased by an average of 9.9% across all over the last yearIn other communities, the rate is 6.3%, according to data from real estate portal Idealista. With data until November, Catalonia is the most affected region tourists received in 2023With a total of 16.9 million people, the Balearic Islands (14.2 million), the Canary Islands (12.5 million), Andalusia (11.5 million), the Valencian Community (9.7 million) and the Madrid Community (7.2 million) come next. . National Institute of Statistics (INE).
Except for Catalonia and Madrid, where house prices appreciated by 1.9% and 4.8% respectively, in the remaining regions the increases were in double digits: 15.9% in the Canary Islands, 12.7% in the Balearic Islands, 11.3% in the Valencian Community and 9.9% in Andalusia. The two communities in which Spain’s two largest populated cities are clustered, in addition to the tourist component they have, also influence other economic conditions that explain the different behavior.
Importance of foreigners
The behavior of the housing market in tourist areas is closely linked to the housing demand of foreigners. In recent years, foreigners’ appetite has been very high, and purchases have reached an all-time high. Francisco Inaretareal estate portal spokesperson IdealistHe believes that this is one of the main reasons for price increases: the archipelago and the Mediterranean arc experienced a larger increase in prices, probably due to significant foreign demand A company that deals with these areas and pays special attention to the markets most relevant to luxury homes. “In the rest of the country, with the exception of markets such as Madrid, San Sebastián or Bilbao, the increases were much more modest because there were no international extras.”
David Martínez, CEO Aedas HousesSpain’s main developer notes the importance of the presence of foreigners: “This large presence of the foreign buyer in the most tourist residential market is beneficial for the sector, as it complements the national buyer in the holiday home segment, but it is also valid for the economy in general, so this requires the ‘export’ of houses. Moreover, the foreign client’s income is in many cases linked to economic cycles different from those we experience in the Spanish economy; They therefore stabilize the demand pattern of a cyclical and local sector such as national real estate.”
Living space manager of the consulting firm in Spain CBRE, Javier Kindelanunderlines that the momentum in foreign demand continues to increase: “The latest data for the third quarter of 2023 show that 15.44 percent of total housing purchases in Spain are made by foreignersTo be Second highest result in the historical series. Prominent nationalities include the British (10%), Germans (7%), French (7%) and Belgians, Moroccans and Italians (5%). The provinces where foreigners bought the most houses in the third quarter were Alicante (43.76%), Santa Cruz de Tenerife (36.58%), Málaga (35.33%) and the Balearic Islands (31.69%). .
What will happen in 2024?
While the housing market is in the slowdown phase, it is unknown what will happen in 2024 after the full boom in 2021 and 2022. According to different estimates, the number of sales will continue moderately, without major declines in prices in general. but there are slight increases. In general terms, the Idealista spokesperson assures that “the current lack of supply hinders many buying and selling operations in Spain and is responsible for price increases, while the increase in financing costs has had little impact” and predicts that the market will remain stable. “Oh The trend continues in 2024despitePrice increases may accelerate more in less touristic areas “In case the interest rate cut announced by the European Central Bank is consolidated in the second half of the year.”
Javier Kindelan points out that the behavior of the housing market in the medium and long term will not be the same everywhere in Spain: “Mainly due to demographic and macroeconomic factors, Provinces with the highest population growth expected in the next five years more positive outlook“In terms of demand and price, these are the Canary and Balearic Islands, Alicante, Malaga, Madrid and Barcelona.”
The CEO of Aedas Homes believes that new construction housing is “going through a fundamentally good period overall, with a lack of supply and the presence of solid and solvent demand.” “Everything shows that this positive moment in the housing market will continue in 2024 and, especially after the pandemic, this will be confirmed in tourist housing, as it has been in recent years. In regions such as the Costa del Sol, Levante, the Balearic Islands or the Canary Islands, or even in the touristic areas in the north such as Laredo or Sanxenxo in destinations Triple demand that strongly drives home purchasing in many cases: local, national and international customers. These are clients who, in many cases, buy a second home, or what we call a hybrid home, where they spend many months of the year taking advantage of what remote working affords them. “The concept of tourist residences or second homes is evolving towards long-term residences,” he concludes.
Source: Informacion
James Sean is a writer for “Social Bites”. He covers a wide range of topics, bringing the latest news and developments to his readers. With a keen sense of what’s important and a passion for writing, James delivers unique and insightful articles that keep his readers informed and engaged.