The recovery of the real estate sector after the pandemic in Alicante has passed with lightning speed. Sales turned out to be so good that the province became the leader among the provinces of Spain in sales of residential real estate in 2022. About 60,000 transactions were concluded, which was the highest figure since 2007.
The main buyers were foreigners, by and large Europeans. The focus is on the secondary residential market. Prices have increased both in the capital Alicante and in the tourist areas of the province. Among the negative aspects, there was practically no new construction. To some extent, this was and remains due to the lack of free land for construction.
Information about the situation in the region is obtained from the report "Panoramica Alicante" from the Alicante Chamber of Commerce in cooperation with CaixaBank. The report contained information on both the state of the provincial real estate market in 2022 and forecasts for 2023. According to Carmen Pastor, head of the Research and Statistics department at the Chamber of Commerce, the figures show that an amount comparable to a third of all household incomes in the region was spent on the real estate market last year.
As for the forecast for 2023, by the end of the year, the housing market will definitely slow down due to the high cost of new buildings and their shortage associated with a shortage of free land. A slowdown in growth was observed already in the first half of the year. According to forecasts, the demand for housing from foreigners will also fall, and prices will rise, although not too much, since the role is played by increased interest rates.
One of the most successful sectors of the Alicante economy remains the tourism sector. It has already recovered to the pre-pandemic level and continues to grow further. It is expected that in 2023 the tourism industry will be able to report on 60 million overnight stops (in fact, how many days tourists spent on vacation in the province).
Up to 13 million people can pass through the doors of the Alicante-Elche International Airport alone. All this will have a positive impact on the rental real estate market and tourist/resort housing. The main category of tourists are foreigners from France, Belgium and Switzerland. As for national tourism, the deterioration of the economic situation and the situation with inflation will lead to a noticeable decrease in the volume of domestic tourism.
Another positive aspect in the economic recovery of Alicante was the low unemployment. The number of people in this category decreased by 16,000 in 2022. Reforms in labor legislation have allowed more people to find a new permanent job. However, the overall unemployment rate is still high — 15.2%. But this is already lower than the 15.7% that were observed in 2019, before the pandemic.