Up to 59% of companies from the real estate sector in Spain predict that rental rates will continue to rise

Up to 59% of companies from the real estate sector in Spain predict that rental rates will continue to rise

According to the fourth edition of the report «Measuring the state of real estate companies in Spain», prepared by EjePrime in cooperation with the consulting company aProperties, up to 59% of organizations in the Spanish real estate market expect continued growth in rental rates. Respondents attribute this to market congestion, inflation and rising interest rates on lending. Up to 67% of respondents, at the same time, expect an increase in demand for rental real estate.

The study states: «Under the current macroeconomic scenario, characterized by uncertainty in the economy and rising interest rates, the desire to rent housing among consumers continues to grow. It is especially growing among the younger generation, who have less purchasing power and no longer consider their own housing as a life priority. Although 3/4 of the Spanish population still live in real estate that is owned by them».

This is emphasized by the data of the properties company itself, which recorded an increase in demand for rental real estate from January to October 2022 by 22% compared to the same period in 2021. The report adds that the country's residential real estate market is quite congested, especially in large cities such as Madrid, Barcelona and Valencia. This also supports the forecast for the growth of rental rates. In the luxury housing segment, according to properties estimates, this year will end with a 5.2% increase in rental rates.

At the same time, it is indicated that 60% of companies in the market agree with the projected increase in the supply of new housing for rent. This should contribute to the revitalization of the sector in the conditions of the upcoming price decline.

It is worth noting that the purpose of this report, «Measuring the state of real estate companies in Spain», is to form an idea about the real estate sector, based primarily on the opinion of the participating companies themselves in this sector. The report is not an exhaustive economic study, but rather a study of market sentiment. The study was conducted on the basis of a survey completed in September 2022 of companies for which real estate transactions are a key or at least an important component of activity. The respondents included developers, intermediaries, appraisers, investment groups and even Protech companies.

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