The Spanish real estate market showed unprecedented results in many respects in 2022. Month after month, the market showed outstanding results in the field of investment, sales, urban planning, digitalization. The peak was September, marking a record for the last 15 years, when more than 57,300 residential properties were sold, according to the National Institute of Statistics of Spain (INE).
Of course, depending on the perspective and points of comparison, not all aspects of the market deserve the characteristic described above. For example, the already mentioned sales in September, although they are record in absolute terms, in relative comparison show, for example, in annual terms, an increase of only 6.9%. For context, the previous 18 months of annual growth showed double digits.
It was such comparisons in recent months that more and more often pointed to the impending slowdown in the market, to the fact that the post-pandemic economic recovery will not last forever and we will have to reckon with the current economic challenges. By the beginning of the fourth quarter of 2022, the market has reached the mark of half a million residential properties sold and it will be able to beat last year's figure of 566,000 sales. However, the gap should not be significant and a sharp decline is clearly visible in the last months of this year.
Cooling finally got to the media sphere. Even in the first half of the year, the coverage of events had a strong "euphoric" tone, and serious problems were usually smoothed out or avoided. However, since August-September, the apparent impending slowdown in the market has become impossible to ignore. It is impossible to ignore to the same extent as the presence of structural problems in the market, which will not allow it to maintain the growth rate gained in the last two years for at least the next five years.
The head of the research department of the Fotocasa real estate portal, Maria Matos, points out that in the near future 2022 will be proclaimed the «golden period» for the Spanish market — the best since 2007. However, looking into the future, analysts will resort to increasingly restrained and cautious market assessments. Global inflation and the increase in interest rates carried out by the ECB are already affecting the purchasing power of Spanish society.
In the long term, we can say with confidence that it will become almost impossible for Spanish citizens to get any sufficient income to accumulate for the purchase of real estate and even rent new housing. Matos is also supported by Francisco Inaretta, a spokesman for the Idealista real estate portal.
The INE data also supports this view. The market has already entered a new dynamic. In annual terms, sales in the province are falling, minus 11.1%, garage premises, storerooms, land plots and even sales in the city are falling, minus 6.1%. The segment of new buildings also takes a step back. It is worth going back to the data for September. Within the last decade, sales of new real estate in September showed a good result — 10,000 objects. However, in annual terms, this is a decrease of 7.8%.