Real estate investment in Spain grows 10% this year and will hold in 2023

Investment activity has been concentrated in the provinces of Barcelona, Madrid, Malaga, Valencia, Seville, Murcia, Gerona, and the Balearic Islands.

The real estate sector has captured the interest of investors this year, which will close with an increase in investment of 10% in 2022.

Investment activity in buildings, houses and flats has been concentrated in the provinces of Barcelona, Madrid, Malaga, Valencia, Seville, Murcia, Gerona, and the Balearic Islands. And, above all, in the first half of the year since the announcement by the European Central Bank (ECB) of the start of interest rate hikes accelerated decision-making to buy homes.

Christian Boesen, the founder and CEO of homes-abroad.com believes that the current macroeconomic context is an opportunity for those investors looking for peace of mind and stable profitability, which allows Spanish real estate to continue registering positive figures "despite the uncertainty generated by inflation, the rise in rates or the measures adopted by the Government to market management and a Housing Law yet to be approved".

Homes-abroad.com ensures that residential is the real estate segment that has attracted the most interest throughout 2022, both in investment volume and in number of operations, with an average annual return of more than 4.5%.

Christian Boesen, emphasizes that “we are in an incredibly changing macroeconomic environment. Nobody would have said in January what we had ahead of us in 2022. Despite the drastic increase in the cost of living and financing, inflation is beginning to come under control, having moderated in November for the fourth consecutive month and settling at 6.8%. There is still liquidity, so the market will hold."

However, Christian Boesen acknowledges that "the rise in mortgage prices has already caused a drop in demand that is affecting prices, although not investor appetite." But he ensures that investors are opting for a prudent policy and that, although they are paralyzing many operations while waiting for the uncertainties to clear up, their interest is maintained, and activity will resume in the next few months.

House prices have grown 7.6% over the summer

Add 34 consecutive quarters of increases, but moderate four tenths compared to the year-on-year rise registered in the second quarter.

The price of free housing rose 7.6% year-on-year in the third quarter, four tenths below the growth of the previous quarter, according to the Housing Price Index (IPV) of the National Institute of Statistics (INE).

With the increase in the third quarter, the price of free housing already accumulates 34 quarters of year-on-year growth, which is equivalent to a little over eight years of continuous increases.

By type of home, the price of new homes increased by 6.8% compared to the third quarter of 2021, which is two points less than the year-on-year rate registered in the second quarter of 2022. For its part, the price of used housing increased by 7.8% in the interannual rate, one tenth below the growth experienced in the previous quarter.

In the quarterly rate (third quarter over second quarter), house prices rose by 1.7% between July and September, two tenths less than in the second quarter and almost one point less than the increase in the first.

With this new rise in the third quarter, there are now seven consecutive quarters of increases in housing prices.

New home prices increased by 0.9% in the third quarter, eight tenths more than in the previous quarter, while second-hand home prices rose 1.9% between July and September, four tenths less than they did in the second quarter.