In the changing landscape of the Spanish real estate market, 2023 has witnessed an interesting divergence between the cost of acquiring second-hand homes and the price of rentals. While the former shows signs of stabilization, the latter continues to climb significantly, marking a clear distinction in the dynamics of the sector.
Evolution of Purchase Prices
Throughout the second half of 2023, the second-hand housing market experienced remarkable price stability. A joint report by Tecnocasa and the Universitat Pompeu Fabra (UPF) revealed a modest 1.69% increase in the value of these properties nationwide. However, cities such as Malaga, Seville, Valencia and Getafe stood out with increases of more than 4%, while Madrid, Zaragoza and Valladolid saw slight decreases in their prices.
Continuous Rental Escalation
In contrast to the stabilization in purchasing, the rental sector has shown no signs of slowing down. The report indicates an average increase of 5.45% in rental prices over the same period, with even more significant increases in metropolises such as Barcelona, Madrid, Seville and Valencia. This trend points to a reduction in rental supply, evidenced by a 57% drop in Tecnocasa’s rental market over the last three years.
Short and Long Term Comparison
The Tecnocasa and UPF analysis concludes that, both in the short and long term, renting is the most expensive option. This finding is particularly relevant in an economic context characterized by high interest rates, which would traditionally increase the attractiveness of renting over buying.
A Changing Market
The Spanish real estate market continues to evolve, presenting both challenges and opportunities for buyers and tenants. While second-hand homes are approaching a break-even point in their prices, the rental sector is heading towards greater scarcity and higher costs. This scenario requires informed strategies on the part of those interested in the real estate market, both for those looking for a home and for investors. For more information and tips on how to navigate the real estate market, we invite you to read more interesting articles on elitecapitalrealestate.com and follow us on Facebook, Instagram and Twitter.
