The dynamics of rental prices for Spanish real estate remains uncertain, as the government has introduced measures to limit monthly growth to 2%. If the purpose of this innovation is to establish a level that prevents the rapid growth of rents, it will not be easy. In the first quarter of 2022, the average rental price in Spain reached 10.14 euros per m2. It grew by 1.6% over the quarter and by more than 5% over the year. The most expensive cities for rental housing were Barcelona with 17.75 euros per m2, Madrid with 15.59 euros per m2, and San Sebastian with 15.54 euros per m2.
Zamora has become the cheapest province to rent real estate, with 5.41 euros per m2. Ourense (6.01 euros per m2), Cuenca (6.08 euros per m2), Ciudad Real (6.17 euros per m2), and Teruel (6.25 euros per m2) also have affordable prices.
Zamora became the city with the highest quarterly rise in rental prices (+8.4%), while Toledo (-3.91%) was the city that lost the most. As for March last year, the largest growth was in Lugo (+19.84%), while in Ourense (-9.79%), the situation was the opposite.
Fortunately, the COVID-19 pandemic has had less impact on the Spanish real estate sector than expected. It is returning to its previous level with economic recovery and tourist activity. In this case, Barcelona, Madrid, and Malaga, as well as autonomous regions such as the Balearic and Canary Islands, have become the places with the fastest growth in rents. Property owners, most of them are landlords, monitor this situation with rising prices and transfer it to rent.
Experts believe that the government's restriction of monthly rent growth to 2% will have "very limited effectiveness." The owners are responsible for renting homes. Moreover, most of them are not large landlords. In addition, the effectiveness of government measures depends on contracts that will be updated in the next three months. From April to June, the same number of contracts are not signed as in August. This measure equals small landlords with large companies that rent out over 150,000 housing units in Spain. These measures may shift to tourist rentals, and in the worst case, if the property is not in high demand, it will remain empty. This interventionism will push investments away, just at the time when construction for rent has begun to gain momentum. This situation creates legal uncertainty among investors.