Here you will find news, views, events and information relating to real-estate in Spain.

House Prices Down in First Quarter

House prices in Malaga fell 2.57% in Q1
Average house price in Malaga fell 2.57% in Q1

House prices in Malaga fell 2.57% in Q1

According to a quarterly report from, the average price of second-hand housing in Spain in March was 1,690 euros per square metre. This represents a decrease of 1.25% when compared to December 2019. Year-on-year, the fall is slightly smaller at -0.61%. When comparing March to February, the contraction is -0.89%.

The trend towards a slowdown in house price increases has been seen for a few months but this could now be compounded by the health crisis we are experiencing,” says Ferran Font, director of studies at “It is still too early to make forecasts, but it is clear that the state of lockdown the country is currently going through has paralysed the real estate industry, since the confinement means potential buyers are not able to visit properties. This will undoubtedly affect the transaction figures and, therefore, the mortgage market too. It could also have an impact of prices dependent on how long the situation continues.

Font said that “although the symptoms of economic slowdown began to be noticed at the end of 2019, an unexpected crisis like that of COVID-19 could further damage the housing market in Spain. However, we must be cautious and not start making negative predictions which could further discourage the market.” Font suggests that now more than ever it is vital that all real estate professionals collaborate and join efforts in order to return to normality as soon as possible.

One possible outcome from this is that while many more people are spending time at home, potential buyers may take the opportunity to peruse property websites and express an interest in buying a property in Spain once the restrictions are lifted.

Autonomous Communities

In the first quarter of this year, the highest increases in the price of second-hand homes for sale were seen in the Balearic Islands (1.68%), Aragon (0.98%) and Extremadura (0.71%). The largest decreases were located in Andalusia (-3.19%), Castilla-La Mancha (-2.37%) and Madrid (-2.28%).

Year-on-year, the most significant increases came from the Balearic Islands (8.32%), the Canary Islands (4.33%) and Madrid (3.60%). The largest annual falls occurred in La Rioja (-5.40%), Castilla-La Mancha (-4.72%) and Catalonia (-3.89%).

The most expensive region at the close of the first quarter was the Balearic Islands with an average price per square metre of €3,165. Meanwhile, the cheapest was Castilla-La Mancha (€870 p/m²).


The largest quarterly house price increases by province were seen in Cuenca (5.02%), Teruel (3.10%) and Álava (2.54%), while the most notable falls were seen in Lugo (-4.94%), Seville (-2.74%) and Malaga (-2.57%).

Year-on-year, the Balearic Islands (8.32%), Álava (8.31%) and Cuenca (5.92%) showed the largest price increases. However, the largest falls in the price of houses in Spain were seen in Ciudad Real (-6.98%), Zamora (-6.91%) and Lleida (-6.42%).

The most expensive province was Balearic Islands where owners are asking an average of €3,165 p/m², while the cheapest province was Cuenca (€747 p/m²).


Home Mortgage Borrowing Up in January

Home mortgage borrowing up 20% in Andalucia
New home mortgages up 20% in Andalucia

Andalucia saw a 17.3% increase in home loans

January saw a 6.1% increase in the number of new home mortgages. The average amount, however, fell by 5% to 114,691 euros, according to data released by the INE.

On all property types, the average amount also fell, with an average of 129,387 euros, 12.2% lower than the same month in 2019.

The total amount of borrowed capital on home mortgages in January reached 4,509 million euros, a slight increase of 0.8% when compared to January 2019.

Interest Rates

Across all property types, the average interest rate at the start of the loans taken in January was 2.56% and the average loan term was 20 years. 58.7% of the new mortgages were taken at a variable interest rate and 41.3% at a fixed rate.

The average interest rate at the beginning of the loan term was 2.24% for variable rate mortgages and 3.14% for fixed rate mortgages.

Looking only at mortgages taken for the purchase of a home, the average interest rate was 2.55% and the average term was 22 years. 58.2% of home mortgages are at a variable rate and 41.8% at a fixed rate.

The average interest rate at the beginning of those new home loans is 2.22% for mortgages on variable rate and 3.05% for fixed rate mortgages.

Results by Autonomous Communities

The communities with the highest number of new home mortgages in January were the Community of Madrid (8,160), Andalusia (7,173) and Catalonia (5,404).

The number of new mortgages in Andalusia represents an increase of 17.3% when compared to January last year. When compared to the previous month, the increase is more notable at 41.4%

The communities in which the most capital was borrowed for home loans are the Community of Madrid (1,231.8 million euros), Catalonia (791.4 million) and Andalusia (707.9 million). Andalusia’s borrowing also represents increases with the monthly variation reaching a 20.2% increase.

The highest annual variation rates in terms of the total capital borrowed are Navarra (58.7%), Extremadura (35.9%) and the Balearic Islands (33.9%). In contrast, the greatest decreases were registered in the Community of Madrid (–10.9%), the Basque Country (–9.0%) and Castilla – La Mancha (–8.3%).

Looking at the number of new home mortgage approvals in January, the highest annual variation rates were seen in Asturias (90.8%), the Balearic Islands (70.9%) and Navarra (69.3%).

On the other hand, the communities with the most significant negative annual variation rates are Madrid (–22.7%), Basque Country (–12.0%) and La Rioja (–5.9%).


Cost of Renting Continues to Rise

Ibiza Town has seen rental costs spiral up 93% in five years
Rental housing in Ibiza Town is up 93% in five years

Rentals in Ibiza Town are up 93% in five years

In the last five years, the price of rental housing in Spain has increased by 50%, according to analysis by Fotocasa.

It has long been subject for debate for the government when considering price caps for rental property, a tactic which few other countries have dared to try. But with the costs involved in buying a home in Spain being as high as they are, and the relatively stagnant incomes there is often no choice but to remain in the rental market, something which, it is suggested, landlords are happy to take advantage of.

Taking a look at prices by autonomous community, it is the Balearic Islands where prices have increased the most, with a 66% increase in average rental costs since 2014. The Canary Islands are next with a 64% increase. Also with increases in the sixties are Madrid and Catalonia where costs have risen 63% and 60%, respectively. Tenants in the Valencian community are paying 57% more than they were five years ago while those in rental housing in Andalusia have to stump up 42% more than five years ago.

It is hard to find any communities where prices haven’t risen, but one of the lowest increases is found in La Rioja where average rental costs have increased 9%. Still a sizeable increase. Also below 30% we find Castilla-La Mancha (17%), Castilla y León (20%), Asturias (22%) and Navarra (27%).

In recent years, the price of rental housing has experienced large increases in price, reaching its historical maximum at the end of 2019, with an average price of €10.18 p/m² per month. This great escalation in prices has been fuelled by the enormous demand for rental housing in Spain, due in part to the inability of the average citizen to access the buying market,” explains Ismael Kardoudi, director of Fotocasa studies.

The Balearic Islands, the Canary Islands, Madrid and Catalonia, communities in which prices have increased the most in recent years, are the areas in which the greatest demand for rental housing is concentrated, since they are economic and demographic nuclei, in addition to tourism,” Kardoudi adds.

Valencia, Santa Cruz de Tenerife and Barcelona see biggest increases

Analysing the data by provinces, it can be seen that Valencia has increased rental prices the most in the last five years, seeing rentals increase by 69%. Following is Santa Cruz de Tenerife, in the Canary Islands, which saw prices increase 68%, and Barcelona which saw increases of 66%. The Balearic Islands (66%), Madrid (63%) and Las Palmas (62%) follow as the provinces where prices have risen the most in the last five years. In fact, there are six provinces that saw prices increase by more than 60%.

The province of Zamora shows the smallest increases in rental prices over the last five years, specifically 6%. They are followed by the province of Cáceres (7%), Palencia (10%), Badajoz (11%), León (12%) and Burgos (12%).

Ibiza saw prices increase by 93% in five years

Looking at the increase in the average rental prices by municipalities, 22 of the 92 reviewed (24%) have a cumulative variation of over 50% in the last five years. Ibiza Town is the municipality in which the price of housing in Spain increased the most, by a staggering 93% in the last five years. This is followed by Arona, in Santa Cruz de Tenerife, with increases of 77%, Valencia capital (72%), L’Hospitalet de Llobregat (72%), Rincón de la Victoria (63%) and Málaga Capital (62%), among others.

The only municipality analysed that saw the average rental price fall was Palma de Mallorca, where average prices dropped by -16% in the last five years.


Home Sales Up in Andalusia in January

The Canary Islands saw a massive 60% increase in sales
The Canary Islands saw a massive 60% increase in sales

Home sales up 60.5% in The Canary Islands

In January, there was 184,699 property transfers registered in the property registers. This is 7.7% lower than in the same month of the previous year. As for sales of homes, there was a 2.6% drop compared to January 2019.

86.6% of property sales registered in January correspond to urban properties and 13.4% to rustic properties. In the case of urban property, 57.4% were sales of homes, according to data released by the INE.

The number of sales of rustic properties decreased 10.2% in January on the annual rate while sales of urban properties decreased by 4.3%.

18.1% of the homes sold in January are new build properties and 81.9% were second-hand. The number of sales of new homes fell by 8.8% and the number of used home sales slowed by 1.2%, compared to January 2019.

Results by autonomous communities

In January, the total number of property sales in the property registers per 100,000 inhabitants reached its highest values in La Rioja (841), Castilla y León (732) and Castilla – La Mancha (690).

Murcia region (5.3%), Castilla y León (3.1%) and Cantabria (0.7%) registered the highest annual variation rates.

Comunidad Foral de Navarra (–23.6%), Cataluña (–23.2%) and La Rioja (–21.9%) presented the biggest negative rates.

In terms of registered home sales, the communities with the highest number of transfers per 100,000 inhabitants are The Canary Islands and Valencia (both with 164), and La Rioja (156).

The communities that presented the greatest annual increases in the number of home sales in January were the Canary Islands (60.5%), the Region of Murcia (16.9%) and Andalusia (6.2%). In real terms, there was 32,894 property sales in Andalusia in January, 2.8% down when compared to January last year. Of those sales, 9,511 were home sales, up 6.2%.

Meanwhile, Cantabria (–18.0%), Basque Country (–14.6%) and Valencia (–10.6%) registered the greatest annual decreases.


New Property Gaining Ground

Buyers have a large choice of new build
Buyers have a large choice of new developments

Buyers have a large choice of new build

With new developments seeing a resurgence since dropping following the crisis, it is no wonder that in 2019, 37% of buyers chose a new property. This is significantly higher than the previous two years. In 2018 new property was the choice for 29% of buyers, and only 20% in 2017.

Buyers are of course still choosy and they don’t limit themselves to only new. In 2017, those who were considering only new property accounted for 8% of buyers, 15% in 2018, and rising to 20% in 2019. The other 80% said they would consider both new and second-hand property, according to a report from fotocasa.

In Madrid, we see the highest percentage of people looking only for new property at 27%. The age group most likely to choose this route are 45 to 54 years old, with 22% of them choosing only new build.

The change has of course come about in no small part thanks to the increase in supply of new property that had fallen in the years following the crisis.

Who chooses new property?

53% of buyers who looked at buying only new property in 2019 were women. 45% of them were upper-middle class, and 25% were middle class. This is generally in line with figures from the previous year.

The age group appears to be more mature with the average age of buyers of new property in 2019 moving up to 38 – 40 years old

The search process of those looking for new property also slightly differs from those considering second-hand property. For example, in relation to location, the majority begin their search looking in their own town, but a different neighbourhood. Furthermore, 25% of the buyers manage to close the deal within two months. 21% take between two and four months. 14% take one to two years, and 7% take longer than two years to find and buy the right property.

These timelines fit, in general, with the expectations of the buyers who considered buying new property: 35% believe that it took much or somewhat less time than expected, another 39% thought that the timeline was more or less what they expected and the remaining 26% that it was a little or much more than expected.

Why new? No reforms, thank you.

If there is something that defines this segment of the market is its aversion to reforms: up to 43% of the buyers who considered the option of new developments (identical percentage in 2018) did so to avoid the need to reform a property. The search for better quality property and additional facilities such as the garage or storage room were all important for these buyers.

Virtually nothing has changed with respect to 2018 in the reasons why these buyers consider new developments. The only detail is the greater consideration (from 13% in 2018 to 19% in 2019) of having time to save for the purchase of a home which is under construction. It is logical that this is the case since, as recent reports have found, the lack of sufficient savings to make a down payment is a common problem given the rise in property prices and the rigidity that banks apply since the crisis when granting mortgages.

However, we must realise that not all buyers who considered new construction ended up buying one. In fact, those who did manage to buy a newly built property register higher percentages in all these reasons stated than those who, despite having considered this segment, finally opted to buy a second-hand house.

Higher prices in New Property over Second-hand

The last group who considered new property but didn’t buy one said that price was the main barrier. 57% said the price was the reason they gave up on the idea. In 2018 that percentage was 50%. Another argument put forward as a reason not to buy new was a lack of supply in their chosen area.

But price is definitely the key. Even those who did buy a new property said it was expensive. 71% of new property buyers in 2019 said the price was higher than they had expected when beginning their search, especially when compared to similar second-hand property.

This is why it is not surprising that the most important characteristic of the new developments by buyers who are looking is that the price fits their budget, a condition that receives 8.5 points out of 10. Other essentials in the property, such as the number of rooms, the surface area/distribution and the environment (neighbourhood, services, orientation, location) are also important.