Spanish Real Estate 2023-2024: A Paradox

The Spanish real estate market in 2023 is characterized by a paradox: prices are rising, but the volume of transactions is falling. This is due to a combination of factors, including rising interest rates, inflation, and the government’s new housing law.

The purchase market

  • Prices: The price of housing in Spain has increased by 7% in the last year.
  • Demand: Demand remains high, but it has shifted to the suburbs.
  • Impact of rising interest rates: The impact of rising interest rates has been lower than expected.
  • Mortgages: Half of all transactions are now conducted without a mortgage.
  • Volume of transactions: The number of homes sold is expected to decline by 8-10% in 2023.

The rental market

  • Prices: Rent prices have increased by 9.2% in the last year.
  • Supply: The supply of permanent rental housing has decreased by 12%.
  • Seasonal rentals: Seasonal rentals have increased by 40%.
  • Rentability: Rental yields are above 7% in some cities.

Forecasts for 2024

  • House prices: Prices are expected to continue to rise in the most dynamic markets.
  • Transaction volume: Transaction volume is expected to stabilize or increase slightly.
  • Rent prices: Rent prices are expected to continue to rise in general.
  • Seasonal rentals: Seasonal rentals are expected to continue to rise.

A vicious circle for tenants

  • Effort: The effort required to rent is greater than that required to buy.
  • Savings: Tenants have more difficulty saving for a down payment.

Analysis

The new housing law, passed in May 2023, has had a negative impact on the rental market. The regulation has reduced the supply of available housing, leading to higher prices and making it more difficult for families to access housing.

To improve the rental market, it is necessary to increase the supply of available housing. This can be done by building new housing, rehabilitating empty housing, and relaxing regulation.

The Spanish real estate market is undergoing a period of transformation, characterized by rising prices and a declining transaction volume. While this may appear as a challenging environment, it presents unique opportunities for astute investors. Nido Invest offers a comprehensive solution to navigate these market dynamics and capitalize on promising investment opportunities.

Nido Estates – Nido Suites – Nido Invest

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