new and used housing prices in 2022
The rise in reference rates and Euribor has been a clear factor in the market pressure seen last year, particularly affecting variable-rate mortgages. In the final quarter, free-standing housing prices rose by 5.5 percent from the same period a year earlier, marking the slowest quarterly increase since the third quarter of 2021 and a 0.8 percent dip from the prior three months. It was the first negative quarterly trend since late 2020, a period shaped by pandemic restrictions lingering in memory.
Overall, housing prices advanced by 7.4 percent across the year, marking a ninth straight annual rise and the strongest gain since 2007. The index showing this change, the IPV from the National Statistics Institute (INE), highlights a 9.8 percent jump during the year. The 2022 increase doubles the 2021 pace of +3.7 percent, driven by gains in both new-build and existing-home segments.
In 2022, new homes led the ascent with a 7.9 percent rise, the sharpest increase since 2007 when prices climbed 11.9 percent. This marked nine consecutive years of price gains for new properties. Existing homes followed with a 7.3 percent rise, more than double the 2021 pace and the strongest increase since 2007, when gains reached 8.2 percent. Used housing thus joined a long pattern of steady annual growth.
The fourth quarter’s slowdown weighed on both categories, with higher rates pushing new fixed-rate loans to record levels. Prices for new homes increased 6.2 percent year-over-year in the fourth quarter, rising by nine tenths versus the third quarter. Existing-home prices rose 5.3 percent on a yearly basis, yet slipped 2.5 percentage points from the prior quarter.
The year-over-year change in free housing prices varied by autonomous community. All regions reported an increase except the Canary Islands, which stayed at 8.1 percent, and Navarra, which rose to 7.2 percent. The largest year-over-year declines appeared in Extremadura, down 3.7 points; the Basque Country, down 2.9 points; Madrid and La Rioja, each down 2.7 points. The regional picture showed a broad mix of growth and retreat across the country.
highest annual rallies
By year-end 2022, Cantabria led with an 8.6 percent year-over-year rise in free housing prices, followed by the Canary Islands at 8.1 percent and the autonomous cities of Ceuta and Melilla, each at 8 percent. Catalonia posted a more modest increase of 5.5 percent. Regions with smaller gains included Extremadura at 2.8 percent, Castilla-La Mancha at 4 percent, and Castilla y León at 4.1 percent.
Compared with the prior quarter, new housing prices advanced by 1.9 percent, while second-hand prices declined by 1.4 percent, marking the steepest quarterly drop since the first quarter of 2013.
In the fourth quarter of 2022, compared with the third quarter, prices fell in 14 autonomous communities and Navarra by 0.7 percent, Canary Islands by 0.5 percent, Cantabria by 0.3 percent, and in Ceuta and Melilla by 1.8 and 0.7 percent respectively. La Rioja experienced the steepest quarterly decline at 1.9 percent, followed by Castilla-La Mancha and the Basque Country with 1.6 percent drops. A handful of regions showed the most pronounced quarterly declines around 1.2 percent.