The interest in properties for sale in Spain continues unabated among domestic and foreign buyers. It has been rising steadily since the middle of the last decade, apart from a brief pandemic lull in 2020.
In the meantime, the properties are again reaching prices, as they last occurred in the context of the real estate bubble in 2008. “We have not yet officially admitted some properties, which have already been sold again,” says Peter Patzak, Managing Director of Sol Bau Denia Immobilien SL.
One of the main reasons for the desire to buy is certainly the current, Europe-wide inflation, which requires safe investment strategies. Due to the pandemic, many people forgoed vacations and other activities for months. Instead, saved money ended up on the high edge. So it makes sense to invest in real estate right now, despite persistently rising prices.
Spain still popular
Spain continues to be popular with Germans, also as a holiday destination. If you do not want to use your acquired property yourself or do not want to use it permanently, you have good return opportunities through holiday rentals. Landlords from the EU also benefit from lucrative tax breaks in Spain.
For many people, the newly regained freedom after the pandemic years also seems to play a role in purchasing decisions. They feel the need to make up for what they have missed, to live their lives again. All this fuels the interest in buying real estate in Spain not only among Germans. Many interested parties are not deterred by the rising prices. The leaders among foreign buyers are the British, followed by germans and French. The share of foreign buyers currently accounts for 17%.
In May 2022, the average price per square metre in Spain was EUR 1869 with a wide range of fluctuations. The real estate situation in Spain was decisive. On the Costa Blanca, which is popular with Germans, the price per square metre was 1570 EUR.
It was above average expensive in the Balearic Islands and in Madrid with more than 3000 EUR. The Basque Country, Catalonia and the Canary Islands were also above average. Within the last quarter, prices fell only in the province of La Rioja, located in the north of the country. The prices paid by foreigners are often well above the average, usually at over 2000 EUR per square meter.
Demand exceeds supply
“The supply of real estate is limited”, says Julia P. Manzau, CMO of Sol Bau Dénia Immobilien SL. “That’s why we are increasingly seeing construction requests.” This is also shown by the figures: in 2021, the increase in built-up area was around 9.2%. However, the current difficulties in the supply of building materials and rising raw material prices are slowing down and are also additional price drivers for new buildings.
In summary, a decline in prices is probably not to be expected in the near future. If you want to buy a property as an investment, you should access it now. There is also nothing to prevent a house purchase in Spain for your own use.