Many foreign real estate buyers consider Spain a safe place to invest in. The Spanish market’s results show that it’s a good idea to invest in property here.
What do experts predict for the Spanish housing market in 2022? We'll list some answers in this article.
Content
- First forecast: Spanish property prices continue rising
- Second forecast: New Spanish buildings drive sales
- Third forecast: Barcelona and Madrid become less attractive to investors
- Fourth forecast: Valencia and other coastal cities attract investors
- Fifth forecast: Spain’s coastal areas are a top residential choice
- Sixth forecast: The real estate sector uses Proptech and Big Data
- Seventh forecast: Rising mortgage rates
- Eighth forecast: The long process of buying a home
- Get support when you buy real estate in Spain
First forecast: Spanish property prices continue rising
The local market recovered after the 2008 crisis hit the Spanish real estate sector and it continued to strengthen despite the pandemic.
Official Spanish housing market data for 2021 isn’t yet published we can look at November. Real estate transactions grew by 25.9% compared to the same period in 2020. In total, over 63,000 properties were sold and 2/3 were apartments. This was a record for the Spanish housing market for the month.
Will transactions and prices continue increasing in 2022? Experts think so. Spanish real estate is a good investment for buyers.
Second forecast: New Spanish buildings drive sales
New buildings will be in high demand in 2022’s real estate market. During the 2008 economic crisis, a lot of new construction stopped because of a lack of resources. But, it’s resumed in many Spanish cities in the past few years.
Hundreds of apartments were built in 2019-2021. This has led to entire new neighborhoods and urban spaces. Areas that were deserted in the past came back to life. There are a few examples from 2021:
- Seville announced plans for a new development of 720 houses in the Northern District;
- Madrid launched a project for a new city block of 2.5 million m2 near the districts of Delicias, Mendes Alvaro, Abronigal, San Diego, and Entrevias;
- Over 51,600 houses were built in Valdecarros.
Analysts say that new real estate costs will rise faster than secondary properties.
So, if you want to buy a property in Spain, take a look at offers in developing areas. These places will soon be new residential centers with likely price increases. If you do, you can save money and make a profit by reselling the house or apartment you buy.
But, investing in Spanish housing can be complicated and it’s important to know how. We’ll talk more about this below.
Third forecast: Barcelona and Madrid become less attractive to investors
Barcelona and Madrid are beautiful and iconic tourist cities in Spain that attract buyers from across the world.
Because they are popular, property prices break records. The cost of buying and renting is high in Barcelona, especially if you compare it to how much people usually earn in the country. Also, the city can’t expand because of undeveloped areas. It doesn’t matter if you’re buying a property to live in or rent out, it isn’t worthwhile to invest in Barcelona for these reasons:
- The price of housing for resale will probably not rise because Barcelona’s housing costs are high. This means that the average Spaniard can’t afford it and ROIs are low.
- Prices may be too high if you want to buy a house for yourself.
These points also apply to real estate in Madrid. Analysts say that other parts of the country are better to invest in. But where exactly?
Fourth forecast: Valencia and other coastal cities attract investors
Analysts say that real estate in Valencia and other coastal cities will be popular to invest in. Life in Valencia is similar to Barcelona ‒ it’s the same weather, food, coastline, and multinational society. But, real estate prices and the cost of living are lower than in Barcelona. Valencia is ideal for investment in the coming years.
Another lovely city on the coast is the Costa del Sol. Many Scandinavian, French, Belgian, and Dutch people love it here.
Other coastal cities like Malaga or Bilbao and San Sebastian in the Basque Country are also loved by expats from all over the world.
Fifth forecast: Spain’s coastal areas are a top residential choice
If you want to buy a house or apartment to live in, check out coastal areas. This is a good alternative to Madrid and Barcelona whether you’re buying your first or second home (for leisure).
If you love a busy life in the metropolis, experts advise looking at the capitals’ surroundings. These areas offer the pros of living in a megalopolis and affordable prices.
Sixth forecast: The real estate sector uses Proptech and Big Data
The technology revolution is transforming all economic areas like banking and retail. The housing sector is no different. Proptech technologies are a set of digital data processing tools that the construction industry uses. These technologies are widespread in real estate and affect sales, construction, management, and rental. Today, an investor can get all the information about a house online through platforms that use Proptech.
Seventh forecast: Rising mortgage rates
Today, the government and banks influence the real estate market. The government has laws to regulate the market and banks control buyers’ mortgages.
There is a debate about how the Spanish government will tackle the huge public debt this year. A lot of this depends on the governing party’s structure but we can predict some points now. Reducing public debt can happen through additional bank taxes. But this may increase mortgage rates.
It makes sense for foreign investors to stay updated about what the Spanish Ministry of Economy does and plan with this in mind. You should also keep track of possible new local taxes.
Eighth forecast: The long process of buying a home
This prediction seems like it contradicts speed and new technologies. But if you want to buy a house in Spain, don’t expect this to happen fast. Even in 2022! Housing purchases won’t be as slow as 7 years ago but you still need patience.
Many foreign buyers face some difficulties when they buy Spanish property. So, you must understand the real estate process in Spain.
Consider some main points before you buy a property. Try to make sure that there are no outstanding debts and the property hasn’t been built illegally.
It’s best to seek help from a lawyer or real estate specialist to walk you through the transaction step by step. The lawyer must speak Spanish and the buyer's native language to understand all contracts and paperwork. You can also hire an interpreter if you need to.
Get support when you buy real estate in Spain
We offer foreign investors professional real estate advice, services, property management, verification, and paperwork. We work with buyers and sellers interested in the Spanish housing market. Feel free to contact us for a no-fee consultation using the phone numbers listed on the website, or write to us. Our specialists will be happy to answer any of your questions.