prices Housing refuses to be demolished Spain though increase in interest rates And decline in mortgage signings. Between investors (as well as foreigners) keen on opportunities, savers lacking secure financial products, and a minimal demographic need to flip homes, the reality is that the real estate industry is weathering the rapid growth in interest rates better than expected in the last round. However, real estate portal Pisos.com predicts that the increase in house prices for sale will be “moderate” until 2024. with a 2% increase in sales (from the 6% expected this year) and a “slight” increase of 1%. in the case of rental housing.
At the end of 2023, it is necessary to assume that sales have stopped in the last period of the year; There is a 6% increase in annual price balance and a 7% increase in rental income.
Research Director floors.com, Ferran Font, reiterated this Wednesday that the increase in the price of money and the cost of mortgages developed “without any impact on prices.” Although analysts admit that it is not clear whether the development of interest rates in the coming months will plateau or decline, the current situation “has not collapsed” thanks to “stable demand” that continues to put pressure on prices “due to the low supply of new construction. Font, made without signing mortgages He admits that in an environment where purchases are on the rise, “buying a house last year was more attractive than this year. While the norm in recent years was 70% of homes purchased with a mortgage, this has now been reduced to 60% in Spain (in some In other markets, this rate drops to 50%).
Font acknowledges that “there is now a greater margin of negotiation between buyers and sellers, although higher demand is putting pressure on prices.” Thus, the percentage discount on the starting price is around 10%.
Regarding the rental market, he noted that there are “a lot of imbalances” between supply and demand; this was mainly because demand was going to rent as it “lacked access” to the purchase market, but he assured that many imbalances were involved. Tenants are fleeing the most central areas where rental prices are more stressful, which will mean a decline in rental prices for next year in some areas. Likewise, he warned that the new housing law was causing many properties to abandon the traditional rental market and turn to the temporary, tourist and room rental market.
During the presentation of the research, Font assured that housing sales will close the year with a 10 percent decrease to 584 thousand 545 operations, and next year housing sales will decrease to 4 percent, to 561 thousand 163 operations. Regarding mortgages, the expert predicts that by the end of 2023 the number of signatures will fall by 18% to 379,954, and these will continue to fall to 336,698 by 2024, with 11% fewer operations.
Pisos.com predictions According to Font, they point to a total of 115,458 new construction visas for 2023 and 116,613 for 2024; this figure remains “above the minimum”, but this figure is “far” from meeting the housing need in Spain.
When asked about the impact of the reference index that the Government of New Spain wants to develop to determine housing prices in stressed areas, Font predicted that this index would create “conflict”. “We will enter into a conflict of powers and unconstitutionality in the preparation of this index, which seems quite complex,” said the expert, reminding that limiting housing prices in troubled regions could cause problems with autonomous communities. Authorities have been given regarding housing matters.