In 2021, agents of foreign property buyers showed once again serious activity in Valencia. Thus, 35% of all real estate transactions in the city were carried out by Engel & Völkers, a German real estate company. Among buyers, German citizens also became the leaders in terms of nationality.
According to the latest statistics by the International Property Registries Association of Spain, the autonomous community of Valencia ranks third in the number of homes purchased by foreigners. It is followed by two archipelagos, the Balearic Islands and the Canary Islands.
According to the Engel & Völkers report on the local real estate market in 2021-22 presented by Juan-Galo Macia, a consultant for Spain, Portugal, and Andorra, the city of Turia is known to remain one of the most attractive major capitals of the Spanish regions for the acquisition of real estate.
In Turia, the average house price is about 2,402 euros per sq.m.. This is a 6% growth in annual terms. Only three cities showed better results: Eixample, Ciutat Velha, and Pla del Real.
In Valencia, the most sought-after type of property is a three-bedroom apartment with a terrace and an average living area of 128 sq.m. These units can often be found in Ciutat Velha, Extramurs, and Eixample.
On the outskirts of cities and in the suburbs, buyers are more focused on purchasing self-sustaining homes with a garden or other green space.
The buying and selling of the second hand houses has a special place in the market of Valencia. This region has the highest share of transactions in the secondary market in the total number of real estate transactions among all other Spanish regions. Specifically, the second hand housing transactions accounted for 86% of the total number.
This transaction distribution should change in the near future. Although it should be noted that the supply of new buildings (note. new buildings, off-plan) is rather inelastic in Valencia. The main developments are in remote areas far from local centers. Because in these center, available free land plots suitable for such construction are extremely limited.
As a result, new Engel & Völkers buildings in Valencia experienced an 8% price increase in January 2021. And this trend continues up to this day, in 2022. Such factors as rising construction costs, projected completion dates, and demand higher than supply make a key contribution to price increases.
The growth in housing rents reached 9% in Valencia
After unusual rates in 2020 resulted from the COVID-19 pandemic, in 2021, the Valencian rental market has recorded an increase in consumer demand. For example, the average rental rate for a housing unit in Turia in 2021 was 11.2 euros per sq.m. This remains at almost the same level compared to the pre-pandemic year of 2019, but it is 9% higher than in 2020.
It is necessary to highlight the growth of rental rates in such districts as Pablados Martimos, Ciutat Velha, and Eixample; 13.7 euros, 12.2 euros, and 12.2 euros per sq.m. respectively.
Returning to the example of Engel & Völkers. In the company's portfolio of clients looking for opportunities to rent housing property, 60% of potential tenants are foreigners. The remaining 40% are Spanish citizens, mostly young families looking for permanent place of residence.
By nationality, the French use Engel & Völkers' rental services most often. They hold 5.9% of the total number of foreign tenants. They are followed by the citizens of Germany.
Foreigners most frequently select areas, such as Ciutat Velha, Eixample, Extramur, Poblados Maritimos, Cuatre Carreres, and El Pla del Real.
On the outskirts of cities and in the suburbs, the majority of tenants are the Spanish, followed by Italians. As indicated earlier, in these districts, preference is given to self-sustaining houses over apartments. The area of these houses is usually 250 sq.m. They have five bedrooms and three bathrooms.
Betera and La Cañada are the most popular areas in the suburbs.