The housing crisis in Spain continues to escalate, with access to affordable housing becoming a major economic problem. Data reveals a steady increase in housing costs over the past decade, culminating in a 7.8% rise in housing and a staggering 11.2% year-on-year increase in new construction.
The price surge in new builds – the highest since the 2007 mortgage crisis – contrasts sharply with the growing affordability issue.
The severity of the situation has prompted widespread concern. The dean of the College of Notaries of Catalonia warned in a recent letter that the housing crisis could lead to “total disintegration” and “general resentment” among citizens.
In response, the Spanish government has pledged to address the issue. Prime Minister Pedro Sánchez announced that housing will be a key focus of the upcoming Conference of Autonomous Presidents, aiming to balance tourism and the well-being of residents. He also vowed to act against speculators and property owners with large portfolios that are contributing to the problem.
Despite continual news surrounding housing issues partly caused by mass tourism in tourist hotspots like Barcelona and Málaga, it’s the more rural, interior Navarra and Aragón that have seen the biggest increase in prices. Housing prices have risen across all autonomous communities in Spain, but Navarra and Aragon have experienced the most significant increases. Navarra saw a price surge of over 10%, while Aragon closely followed with a 9.9% rise. Other regions with notable increases include Andalucia, Ceuta, Cantabria, the Valencian Community, and La Rioja, all reporting increases of 8.6% or more.
At the other end of the spectrum, Castilla-La Mancha, Extremadura, the Balearic Islands, Galicia, and Catalonia witnessed more moderate price increases, ranging from 5.3% to 6.7%.
Compared the second quarter to the first three months of the year, housing prices increased by a substantial 3.6%. This marks the largest quarterly rise since 2015. Pre-owned housing also saw a significant increase of 3.7% during this period. However, new housing prices grew more modestly, growing by 2.7% compared to the first quarter.
If you are looking to buy a property in Spain and waiting for the prices to drop it may be a long wait as there are no signs the market is cooling. With a lack of supply of properties on the market they are selling fast so make sure you have your finance options in place before you start looking as sellers are looking for fast completions with lots off offers from buyers
If you are looking to buy a property in Spain and need a mortgage, email mark@vci-network.com the latest criteria