House prices in Spain are rising more than inflation.
By February 9, 2023 4 min read
The price of second-hand homes for sale in Spain began 2023 with a year-on-year increase of 5.4% in January, placing the average price at 1,922 euros/m2 in the property price index.
It is the second highest data collected after November last year, which also recorded an increase of 5.4% compared to the same month in 2021. In both cases, however, the increase in housing prices on the market is below inflation in Spain.
A week ago, the National Institute of Statistics (INE) published the advance data for the consumer price index (CPI) for January, with a rate of 5.8%, a tenth more than the data for December. It is slightly less than half a point higher than the increase in the prices of homes for sale on the housing market.
Housing in Valencia, Alicante, Malaga, or Palma is growing more than the CPI.
If we zoom in on the average price of homes for sale in the provincial capitals, we see that in 16 cities there have been increases higher than the inflation data presented by the INE. Santa Cruz de Tenerife (18.7%), Alicante (13.2%), Valencia (11.4%), Guadalajara (11.3%) and Cuenca (10.8%) lead these increases with double-digit percentages, which in some cases doubles and even triples the lPC index.
Important housing markets such as Palma (9.9%), with the highest average price among these 16 capitals, with its 3,467 euros/m2; Seville (8.1%) or Malaga (8%), which reached all-time highs at 2,365 euros/m2, have recorded increases in January above inflation.
A further 30 regional capitals recorded increases in house prices, but below inflation. Among them are the major markets of Madrid (4.9%) and Barcelona (3%), with some of the highest average prices among the provincial capitals, at 3,929 euros/m2 and 4,050 euros/m2 respectively, surpassed only by San Sebastián and its 5,124 euro/m2, after a 3.2% year-on-year increase in January.
Marbella (Costa Del Sol) as well as Orihuela and Torrevieja (Costa Blanca) lead the increases among the large municipalities.
Data also analyses the development of housing prices in the 50 cities with more than 80,000 inhabitants in Spain at the beginning of 2022, according to the population census of municipalities published by INE. Of these, just under half (24) have registered annual increases in the prices of homes for sale above the advance CPI for January, with up to eight of them presenting double-digit increases.
Above all, the cities of Marbella (19.9%), Orihuela (18.5%) or Torrevieja (16.1%) stand out, where their prices also remain at all-time highs with 4,121 euros/m2, 2,246 euros/m2 and 1,672 euros/m2, respectively Of other coastal towns that we deal with, we find, among other things, Mijas (14.2%) and Fuengirola (12.1%), both in Malaga, as well as Lorca in Murcia and Elche in Alicante, both with 8.1%.
In addition to the locations that we have mentioned in terms of maximum prices, they have also closed January with record prices in Mijas (2,440 euros/m2) and in Fuengirola (2,892 euros/m2).
In Barcelona, increases in the metropolitan area of the Catalan capital are more moderate, with Sant Cugat del Vallès (6.6%) and Mataró (6.5%) standing out, still above inflation.
Hospital de Llobregat (4.9%) and Cornellà (3.8%) show increases still higher than the city of Barcelona itself (3%), followed by Terrassa (2.8%), Sabadell (2.6%) , Sant Boi de Llobregat (2.5%). %), Santa Coloma de Gramanet (1.7%) and Badalona (0.8%).
With this data analyzed, it is worth highlighting three other population areas where the increase in the prices of homes for sale is notable. As we have already seen, Alicante (13.2%), Elche (8.1%), Torrevieja (16.1%) and Orihuela (18.5%), have notable increases above inflation.
Another reduction that must be mentioned is Málaga (8%), where apart from growing above inflation, housing also hits a ceiling, as we have mentioned in Marbella, Mijas and Fuengirola. Vélez-Málaga (4.1%) also appears on the list, where prices are rising more steadily.
The conclusion is clear. It is exactly as we at homes-abroad.com have predicted for a long time. Prices are going to rise in 2023. Prices in the most popular areas only seem to go one way – up! So the question is whether you have ice in your stomach or want to join the bandwagon, while prices are still lower than the old peak that still goes all the way back to 2007. We will most likely reach that peak in the 2nd or 3rd quarter of 2023 and then we will move towards a new top.
Book your viewing trip with homes-abroad.com already today. We have all the best on the shelves and have 20 years of experience in property trading in Spain. You will not regret it.
Written and edited by:
Christian Boesen
Owner of homes-abroad.com
From dream, to dream home - We make the dream come true.