Forecasts of house price growth in Spain: what to expect in the near future?
Experts warn that house prices in Spain will continue to rise. The Association of Spanish Cost Analysis (AEV), representing 86% of companies in this field, predicts an increase in prices for second homes and new buildings to 5% by the end of the year.
This growth is driven by several key factors. The expected reduction in interest rates will facilitate access to credit for the less well-off segments of the population, and stability or improved employment levels will also contribute to an increase in demand for housing. Even at the lower end of the forecasts, an increase of 3-4% is expected.
📊 Real estate market: current state
According to the General Council of the Notary, in April 2023, housing prices increased by 0.5% compared to last year. This small but significant growth is accompanied by an increase in the number of purchase and sale transactions by 25% and mortgage loans by 37%. These figures indicate a high level of activity in the real estate market, which pushes prices up.
📈 Long-term growth factors
- Immigration and the creation of new households: In recent years, Spain has attracted a large number of immigrants, which increases the demand for housing. The creation of new households also contributes to this process.
- Housing shortage: By 2025, the housing shortage is estimated at 600,000 units. This is a significant number, especially in conditions of low construction volumes, amounting to about 100,000 units per year.
- Lack of available land: There is a shortage of available land in popular areas of Spain, which limits opportunities for new construction and contributes to rising prices.
- Restrictions on lending: Despite the expected reduction in interest rates, restrictions on lending also play a role in shaping housing prices.
🔍 Historical comparison
Historical comparison shows that housing prices today are only 6.75% lower than in 2007. However, taking into account inflation, the real difference in price is more than 40%. This suggests that current prices are still high in real terms, despite the nominal decline.
Experts believe that the current situation in the housing market in Spain continues to be tense. Buyers should be prepared for further price increases. Key factors such as lower interest rates, job stability, immigration and housing shortages will continue to put pressure on the market, contributing to its further growth.
In these circumstances, it is important to closely monitor changes in the market and plan the purchase of housing, taking into account all possible factors, in order to make the most profitable investment in real estate.