Foreigners entering the Spanish residential real estate market are increasingly preferring to rent a home to buy it. According to the Idealista portal, at the end of 2022, foreigners accounted for 14.9% of the total demand for residential real estate rentals in Spain.
This indicator indicates that the demand for rent from foreign citizens has not only become the highest since 2019, but also exceeded the share of foreign demand for the purchase of housing, which amounted to 14.5%.
It is worth noting that the demand for purchase has also fallen, if we compare December 2022 with November. In November, foreigners took a share of 15.2% in the demand for the purchase of residential real estate, and the share in the demand for rent was at 14.7%. It took only a month for a noticeable change in the trend.
Moreover, this change has occurred in almost all areas of Spain. At the end of December 2022, more interest in renting than buying housing was registered in all provincial capitals of the country. Only four major cities turned out to be exceptions: autonomous Ceuta and Melilla, as well as Girona and Toledo.
Provincial capitals with the highest demand
It should be noted that above we were talking about the average indicators for the country. Let's turn to specific examples. For example, Alicante leads by a margin in terms of foreign demand for rental housing. The share of foreigners who want to rent real estate in the city has reached 26% of the total demand.
Alicante's closest rivals are Barcelona, Valencia, Palma de Mallorca and Malaga, whose share ranges from 22.2% to 24.8%. Santa Cruz de Tenerife is in sixth position with a demand share of 19.7%. It is followed by Tarragona (17.5%), Girona (15.3%) and Las Palmas de Gran Canaria (15%).
Cadiz, Granada, Madrid, Castellon de la Plana, Almeria, San Sebastian, Seville, Jaen, Salamanca, Santander and the autonomous city of Melilla are also above the double-digit indicator of foreign demand.
However, in half of the country's provinces, the share of foreigners in the demand for rental housing is less than 10%. By cities, we are talking about a total of 32 large settlements. The least foreigners looking for rental opportunities were recorded in Soria, Guadalajara, Samara and Huesca. The share of such demand in them was less than 4%.
If we consider the foreign demand for purchase, then we will again see Alicante in the first position in the national ranking. The share in the demand for buying here has reached 25.8% (approx. only 0.1% less than the share of rental demand). The next most popular provincial capitals are Palma de Mallorca (22.9%), Barcelona (20.2%), Valencia (20%), Malaga (18.5%), Santa Cruz de Tenerife (17.4%), Girona (15.3%) and Melilla (15%).
More than 10% share of foreign demand is also observed in Tarragona, Las Palmas de Gran Canaria, Cadiz, Ceuta, Castellon de la Plana and Granada. In other regions and capitals of the country, the demand for buying real estate from abroad is below double digits. The largest in this category are Madrid and San Sebastian - 7.8% and 6.7%.