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Welcome to our blog! If you are interested in the latest developments in the Spanish real estate market, you are in the right place. Whether you are an experienced investor, a potential buyer, or simply curious about how the market is evolving, we have compiled the latest information and analysis for you. Let’s take a look together at current trends, from the national level to local hotspots such as Marbella and the Costa del Sol.

1. National Real Estate Market Trends

The national real estate market in Spain is showing signs of stabilization and moderate growth. According to data from Tinsa IMIE Local Market Statistics, residential property prices in most regions have maintained a stabilization trend, although growth varies across different areas:

1.1. Moderate Price Increase
The average value of new and used properties has slightly increased, with a rise of 0.1% compared to the previous quarter and a year-on-year increase of 3.3%. This trend indicates more stable price growth following stronger increases in previous quarters.

1.2. Regional Price Differences
In large cities like Madrid and Barcelona, property prices have slightly declined this quarter, with decreases of 1.1% and 0.7%, respectively. Factors contributing to this include a reduction in mortgage loans and a decrease in household purchasing power, affecting housing affordability in urban centers.

1.3. Significant Growth in Certain Areas
Cities such as Guadalajara and coastal cities like Valencia, Almería, Santa Cruz de Tenerife, and Málaga have seen significant annual growth, with increases of over 8%. This reflects the diverse opportunities and varying dynamics in the Spanish real estate market.

Overall, the Spanish real estate market in the first quarter of 2024 shows signs of price stabilization and moderation, with considerable differences in certain areas. While housing affordability in major cities remains a challenge, the dynamism in tourist regions and specific locations offers opportunities for investors and buyers. Monitoring these trends is crucial for making informed decisions in the real estate sector.

2. Local Real Estate Market Trends

The luxury real estate market in Spain is experiencing substantial growth, driven by increased investments from high-net-worth individuals. This growth has been particularly pronounced in major centers such as Barcelona, Madrid, the Balearic Islands, and the province of Málaga, including Marbella.

2.1. Price Increase in the Luxury Market
In the past two years, luxury property prices have risen by 10-20%, with a 55% increase in transactions for properties over 3 million euros in 2022. Málaga leads the luxury market, with 2,500 homes costing over 3 million euros, accounting for 34% of all luxury property sales in Spain.

2.2. Focus on the "Golden Triangle"
Most of these high-end properties are located in the "Golden Triangle" of Benahavís, Estepona, and Marbella. In Marbella and Benahavís, houses priced over 3 million euros accounted for over 3.5% of all property sales by the end of 2022, a significant increase from 2021. Currently, these houses make up 6% of the total housing stock in these areas.

3. Factors Influencing the Real Estate Market in Marbella

Several factors contribute to the trends in Marbella’s real estate market:

3.1. Zoning Issues
Marbella has faced a zoning paralysis for over a decade, leading to a shortage of available housing. This shortage is expected to persist despite new zoning laws.

3.2. Attraction for Wealthy Individuals
Marbella continues to attract wealthy individuals due to its luxurious amenities, infrastructure, facilities, pristine beaches, and golf courses. This demand has significantly influenced property prices in Marbella.

3.3. Impact on Property Prices
The increase in luxury properties has led to a 15% rise in property prices across all categories in Marbella between June 2022 and June 2023. The average asking price reached €4.46 per square meter in December, doubling the price from a decade ago.

4. Price Changes, Demand, and Supply in the Real Estate Market

4.1. Forecasts for the Costa del Sol Market in 2024
The real estate market on the Costa del Sol is expected to continue facing supply shortages in 2024, similar to 2023. Analysts predict that unprecedented demand, coupled with limited new constructions and resale properties, will continue to hinder transaction rates.

4.2. Price Increases
Idealista reports an annual price increase of 13% by November, exceeding the national rate by 6%. The Registrars Association recorded a price increase of 5.5% in the third quarter compared to the second and third quarters of 2022. Marbella agents estimate an annual increase of 15% in the western part of the Costa del Sol.

4.3. Future Trends
Prices are expected to continue rising, albeit at a slightly lower rate than in 2023. This is due to ongoing supply constraints and the purchasing power of buyers. A stable outlook with price adjustments and moderate growth in the resale market and limited new constructions is forecasted for 2024.

5. Conclusion

The Spanish real estate market in 2024 navigates through a complex landscape of stabilization, regional differences, and significant growth in the luxury segment. Major cities face challenges with housing affordability, while areas like Marbella and the Costa del Sol thrive with high demand and significant price increases. Understanding these trends is crucial for making informed decisions in the real estate sector. Whether you are a buyer, investor, or industry professional, observing these market dynamics will help you navigate the evolving real estate market effectively.

Image: Villa Haven, BHHS-MAR-0293

Published: 08 Jul 2024

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