Alicante finished 2023 with record figures in the construction sector. The province tallied 8,783 newly built houses, the highest annual total since 2007, surpassing the previous peak by 17 percent (7,532 dwellings) and marking a 52 percent rise from 2022 with 5,768 homes approved. Beyond the Vega Baja, Marina Alta and Marina Baixa were the most active subregions, and at the municipal level, Orihuela and Alicante led the pack with over a thousand homes each.
The 2023 results were driven largely by a remarkable second quarter, when construction began on 3,001 homes. That quarterly figure outpaced the total number of houses built in every year from 2009 to 2014, in a single quarter—a milestone that is unlikely to be repeated soon, according to Carlos Casas, president of the Technical College of Architecture in Alicante.
In the second half of 2023, activity remained strong but grew at a slower pace than in the prior year. Comparing the same periods in 2023 with 2022, the number of houses rose 99 percent in the second quarter, 48 percent in the third quarter, and 13 percent in the fourth quarter. Overall, the year saw an increase from 1,651 homes in 2022 to 1,870 in 2023.
The fourth quarter, while higher than 18 of the last 28 quarters, still suggests a potential slowdown. The forecast, echoing the prior quarter, was that growth would ease. If activity stays at the third and fourth quarter levels, the sector could benefit this year as well, according to remarks attributed to R. (a representative of the sector) and observers.
La Vega Baja Leads the Way
Regional distribution highlights Vega Baja increasing its share from 38.7 percent of the total in 2022 to 43.6 percent in 2023. Marina Alta and Marina Baixa remain the next most dynamic areas, rising from 24.8 percent to 26.5 percent. The Alicante region’s share declined slightly from 22.1 percent to 20.1 percent, while Elche shifted from 8 percent to 6.5 percent and the interior from 6.5 percent to 3 percent, falling to around 0.4 percent in some analyses.
These growth rates have allowed Vega Baja, Marina Alta, Marina Baixa, and the Alicante region to reach activity levels not seen since 2008, making it challenging to surpass this year’s numbers in an economy that is expected to be less favorable. In this regional mix, those areas account for about 90 percent of the provincial activity, according to COATA president Carlos Casas.
Vega Baja saw housing starts up 71 percent, while Marina Alta and Marina Baixa grew 62 percent. Alicante and Elche also posted solid growth versus 2022, though not as pronounced as the trio of regions above. The interior, however, showed a different trend with a 20 percent drop.
The Rise in Construction and Services Boosts Alicante’s Economic Pulse
The fourth-quarter data from Vega Baja marks a brief pause in the earlier, rapid ascent of the last five quarters. In 2023, 589 homes started in Vega Baja during the year’s final quarter, down 10 percent from 653 in the fourth quarter of 2022. The Alicante region finished the year on a strong note, up 176 percent from the previous quarter and 39 percent from the fourth quarter of 2022, reaching its highest quarterly levels since 2008. Activity in Marina Alta and Marina Baixa stayed near their peaks, with six straight quarters of growth and an 18 percent rise in the last quarter and 32 percent in the fourth quarter of 2023 compared to late 2022.
In contrast, Elche and interior areas showed softer momentum. The Elche region started 87 houses in the current quarter, 53 percent below the third quarter, a sign of the region’s partial retreat from pre-pandemic highs in late 2019 and early 2020. Domestic sector activity also cooled, with a 37 percent drop in the fourth quarter versus the third and a 52 percent slide compared with the same period a year earlier.
Orihuela and Alicante Surpass 1,000 Homes
Two municipalities exceeded 1,000 housing starts in 2023. Orihuela led with 1,181 homes, while Alicante followed with 1,099. Torrevieja stood at 898, and Dénia trailed with 587. Pilar de la Horadada, Elche, Benidorm, San Miguel, Guardamar, and San Juan de Alicante also posted notable totals, illustrating a broader provincial momentum. In 2022, only Alicante, Orihuela and Pilar de la Horadada exceeded 300 homes; in 2023, ten municipalities surpassed that threshold.
Examining the fourth quarter, Alicante alone accounted for 520 residences, nearly half of the town’s yearly launches. La Vila Joiosa logged 224, while Orihuela recorded 182 for the quarter. The 2023 average cost of residential construction reached 556 euros per square meter, up 5.1 percent from 2022’s 529 euros and 14.4 percent above the pre-pandemic 2019 level of 486 euros.
Concerns over licensing delays persist. Jesualdo Ros, secretary of the Province of Alicante’s Real Estate Developers Association (Provia), notes that some of the year’s housing starts were driven by a backlog in permit issuance. He cautions that a large portion of the demand from the prior three years could not be addressed due to permit bottlenecks, and he regrets that many municipalities have not leveraged available tools to accelerate processes, such as urban cooperation agreements.