After a year or so of disruption due to the pandemic, how has the Spanish property market fared? We take a look at the latest data and trends in our June 2021 update…
General property update
The overall trend is that Spanish house prices are on the rise, despite disruption caused by the pandemic.
In the last quarter of 2020, average house prices rose by 1.5% year-on-year. This increase has continued into 2021, with prices rising 4.4% YOY in May. Put into numbers, the average price of a home in Spain is now €1,805 €/m2.
Of course, the extent of this increase varies across the country. There are some notable hotspots where prices have seen a big increase, particularly on the coast. As of May 2021, house prices are the highest they have ever been in the Balearics, with the average home now costing 3,141 €/m2. Similarly, prices are up by 3.1% in Malaga on the Costa del Sol and 2.6% in Alicante on the Costa Blanca.
Prices are up in Cataluña (including Barcelona) too, by 4.3% YOY, with homes now costing an average of 2,323 €/m2. The Community of Valencia has also seen a rise, with the average price of a home now costing 1,452 €/m2, up 4.8% from last May.
This overall rise in prices comes after two quarters of negative year-on-year price differences in 2020 in almost all regions of Spain.
Data source: idealista.com
So, why are prices rising?
Despite analysts predicting “unprecedented drops” in house prices, namely in areas popular with expats, the reality has been quite the opposite.
One reason for the Spanish property market remaining buoyant is the demand for properties with more space. Much like in the UK, many Spaniards are fed up with their small city apartments and are turning to larger properties with more outdoor space. Latest figures show that the annual price rise for major urban cities was just 0.4% as people moved out towards the coast and countryside.
People want larger properties with more outdoor space
Another reason why the coast has fared so well during the pandemic is that with the rise in remote working and the ability to theoretically “work from anywhere”, people are planning to spend more time at their second homes. And with the Costas being well served by low-cost airlines, many Brits are preparing to buy and work remotely in the sunshine.
Travelling to Spain for property viewings
At the time of writing, Spain is on the UK’s amber list. This means that travel for leisure purposes is not advised, and if you do travel to Spain, you will need to take regular PCR tests on your return and quarantine at home for 10 days.
However, travel for property purchasing is deemed as a “reasonable excuse” for travel. So, if you are willing to follow the UK’s travel rules, then you can still go and physically view properties in Spain.