House Prices Continue to Rise

Here’s a brief overview of the current landscape:

• The General Index rose by 0.9% from January to December, positioning the annual rate at 6.6%.
• Metropolitan areas, capitals, large cities, and inland municipalities saw monthly increases ranging from 0.9% to 1.0%.
• The most significant price growth over the last 12 months continues to be concentrated in the “Islands” (+11.5% nominal and +8.5% real) and the “Mediterranean Coast” (+9.0% nominal and +6.0% real).
• The average value of housing in Spain is still 13.7% below the peak reached in 2007-2008.

The price of housing continued its upward trajectory in January and is now 6.6% more expensive than in the same month of 2023 (+3.6% in real terms, accounting for inflation). The most dynamic groups were the large cities (+0.9% monthly) and metropolitan areas (+1.0%), which brought the average price growth in Spain to 0.9% in January. This momentum reflects the vibrancy of a market that remains active amid decreasing interest rates.

“Employment has remained at high levels, continuing to support household solvency, which has regained its purchasing power over the last year. This solvent demand continues to be energized by the lowering of interest rates and increased ease of access to credit,” explains Cristina Arias, Director of the Tinsa by Accumin Spain Research Service.

The monthly variation of the analyzed groups ranged from 0.3% in the ‘Islands’ to 1.0% in ‘Metropolitan areas’. “In January, residential prices continued to intensify their momentum, supported by the acceleration of prices in capitals and large cities and their metropolitan areas,” notes Arias.

At SGM Abogados, we remain committed to guiding our clients through these dynamic market conditions, providing expert advice tailored to the unique aspects of each locality and ensuring informed decision-making in real estate investments.