The price increases of rental housing slowed in 2018 and ended the year with an interannual increase of 9.3%. Compare this to growth of 18.4% in 2017. This leaves the average square metre at 10.6 euros per month. The slowdown was caused in part by a fall in prices during Q4 when the average cost fell by 0.6%.
Head of studies at idealista, Fernando Encinar, says that “the numbers show what we have been saying: there is no rental bubble. Prices have risen across the country in 2018 but this growth is slower than in previous years. Additionally, the larger rental markets, like Barcelona and Madrid, usually set the trend which will be seen later in the rest of the country. In Barcelona, rental prices have fallen for the second consecutive year and in Madrid they have stabilised with a small annual increase of 4%, although the final months of the year saw falls.”
“In some areas there may still be tension in the prices, but it will be based on high demand that clashes with lower availability. But in general, we expect a moderation in prices.”
All the communities registered higher prices than they did a year ago, except for Extremadura (-0.1%). The largest increase was seen in La Rioja, where owners are asking for 10.5% more than they did last year. Other significant increases were seen in Navarra (9.5%) and Cantabria (8.8%). Catalonia experienced the smallest increase with prices rising just 1.3%. Other communities to see rises below 5% were the Balearic Islands (2.9%), Murcia (4.2%) and Castilla y León (4.9%).
Madrid is the most expensive autonomy for rentals with an average cost per square metre of 15.1 euros per month. Catalonia follows with 14.6 euros p/m² per month. Following are the Balearic Islands and Euskadi, with averages of 12.9 euros and 11.8 euros p/m² per month, respectively.
The cheapest communities for monthly rental costs are Extremadura (4.1 euros p/m²), Castilla La Mancha (5.1 euros p/m²) and La Rioja (5.7 euros p/m²).
In Andalucia, rental costs ended 2018 with an annual increase of 8.5%. This puts the average cost per square metre at 8 euros per month.
Only four provinces saw their rental costs fall in 2018. The most significant fall was seen in Tarragona, where prices fell by 2.7%. This was followed by falls in Badajoz (-2.2%), Ciudad Real (-0.9%) and Barcelona (-0.2%). The biggest increases were seen in Santa Cruz de Tenerife (14.5%), Burgos (13.7%) and Toledo (13.7%).
Barcelona is the most expensive province with an average cost per month of 15.8 euros p/m². This was followed by Madrid with 15.1 euros p/m², Guipúzcoa (13.9 euros p/m²) and Baleares (12.9 euros p/m²). Jaén and Cáceres are the cheapest provinces (3.9 euros p/m² and 4 euros p/m², respectively), followed by Ávila (4.2 euros p/m²) and Badajoz (4.2 euros p/m²).
The province of Malaga ended the year with a slight year-on-year increase of 4.3%, in spite of a monthly fall in December of -0.2%.