The conflict with Algeria affected Alicante’s exports and its real estate market
The close ties between Alicante and Algeria—woven by geographic proximity, maritime routes, and ongoing commercial exchanges—give the current diplomatic rupture a unique effect on this province. It isn’t only about trade and exports; the housing market also feels the tremors. A setback in the friendship agreement between Spain and Algeria jeopardized around 65 million euros in annual business, a figure tied to Algerian buyers who previously purchased roughly a thousand homes each year in Alicante as their preferred second residence. Local industry leaders describe the government’s move as a misstep that requires swift, pragmatic responses. The broader consequences extend beyond immediate commerce, touching financial transactions and banking relations between the two nations, with potential ripple effects for the regional economy. In this context, Alicante’s property sector faces a delicate moment as buyers from Algeria—alongside international investors from the United Kingdom, Belgium, Sweden, the Netherlands, Germany, France, Morocco, Russia, Norway, Ireland, Italy, and Romania—reassess their plans in light of the diplomatic standstill. Prior to the pandemic, Algerian citizens bought about a thousand homes yearly, a market size estimated at around 65 million euros annually. The six-year snapshot shows 4,143 homes sold for a total of about 270 million euros, a momentum that has slowed over the last two years due to health restrictions and tighter travel, yet still underscores a critical client base for local real estate professionals. Acknowledging this, Marifé Esteso, president of the Alicante Association of Realtors, stresses that Algerian buyers remain important. The industry anticipates ongoing activity in the near term, while cautioning that a protracted dispute would carry substantial consequences. These insights come from voices within the local real estate community who observe how Algeria has long been a key partner.
The conflict’s effect on exports is evident in Alicante’s trade figures, with exports to Algeria recording a 135 million euro reduction. Sectors such as metals, textiles, footwear, and food have suffered directly, and the broader impact includes suspended banking exchanges and tighter financial ties that could limit growth across multiple industries. This unfolding scenario prompts local businesses to seek contingency measures and diversified markets to sustain activity. In Alicante, the real estate market remains a focal point for resilience, as agents adapt to evolving demand from global buyers who continue to view the province as a favorable destination for second homes and investment. The market’s long-term health will depend on how quickly diplomatic channels re-open and how effectively regulators and lenders align to support buyers and sellers in a renewed environment.
Fernando Abarca, who runs a real estate office in Alicante, notes that roughly 10 percent of his client base comes from Algeria. He describes his clients as a mix of middle and upper-class professionals such as notaries, architects, and doctors seeking a second residence or dual citizenship. Typical inquiries involve properties in the 80,000 to 150,000 euro range, signaling a substantial market that faces a sizable, but not insurmountable, challenge. Abarca also criticizes the diplomatic misstep, arguing that the government did not fully anticipate the consequences of its decisions. Market observers believe a swift resolution is essential to avert further losses and uncertainty for both sides.
At a strategic level, CEV Alicante convened discussions at the Port of Alicante to assess the fallout from the Algeria dispute. The board highlighted Alicante’s distinct relationship with North Africa and noted that Spain is among the leading exporters to the region. The discussions underscored the importance of maritime activity for local companies and the Port of Alicante in particular, which stands as a gateway for trade and passenger movement that influences regional commerce. While the situation remains unsettled, the analysis from CEV Alicante emphasizes the need for coordinated actions to stabilize the market and preserve Alicante’s standing as a hub for international business. The conversation reflects a broader concern among local leaders about sustaining economic momentum while diplomacy continues to unfold.