The year has started with new vigor for the real estate sector. The sale and purchase of homes in Spain has put an end to 13 consecutive months of declines, and according to data from the National Institute of Statistics (INE), a total of 52,796 transactions were registered in February, 5.8% more than in the same month 2023. And so far this year (January and February), operations have risen 1.6%.
Regarding prices, the latest data published by idealista corresponding to the month of March, the average price of used housing for sale has risen 7% year-on-year in March , to settle at 2,079 euros/m2. According to idealista spokesperson, Francisco Iñareta, the available supply continues to fall sharply in the main markets, which makes a strong growth in the number of operations impossible and suggests an increase in market tensions that would lead to a greater increase in prices.
Financial entities, appraisers and the main servicers in the real estate sector have recently published their forecasts for housing this year. We review their perspectives, where the consensus highlights that housing prices will continue to rise in Spain, although at a slower pace, while they expect a slowdown in home sales, although there are discrepancies.
For Caixabank Research, " the real estate sector will go from strength to strength this year and will return to the expansionary stage in 2025," according to Judit Montoriol, lead economist at CaixaBank Research . For this reason, they estimate around 550,000 operations in the current year (40,000 more than they predicted until now), which translates into a decrease of close to 7% compared to 2023. In the case of prices, they foresee an average rebound in 2.7% year-on-year (compared to the previous 1.4%), one point below the increase registered in 2023.
From BBVA Review , sales could contract again, although with less intensity, due, above all, to the persistence of interest rates that can still be considered relatively high. In any case, the good performance of the labor market guarantees that transactions remain around 600,000, a level higher than the average reached between 2015 and 2018.
They agree with CaixaBank that the sector's recovery will come in 2025, when sales grow between 2% and 3%. The price is expected to show a similar evolution to that of the previous year, marked by the shortage of supply, which will continue to set the pace in the sector and lead to new increases in housing prices, but they will be moderate - around 2, 5% -, which will maintain the real evolution at negative rates.
For its part, Bankinter's analysis team estimates that housing will continue to become more expensive both this year and the next. “House prices are holding up surprisingly well in an environment of higher mortgage financing costs. And they will continue to be supported in 2024 and 2025 by a strong labor market, the shortage of supply in the main cities, the Mediterranean coast and islands, and the reduction in interest rates."
Bankinter estimates that housing prices will rise on average in Spain by 1.5% this year and another 2% next year.
Solvia's fourth market study warns that housing prices will rise between 2% and 3% in 2024 and rent will increase between 5% and 7% this year, a trend similar to that corresponding to the fourth quarter of 2023.
“The increase in the cost of living continues to impact the purchasing power and savings capacity of households, directly affecting home purchasing decisions. However, demand remains above the figures recorded in 2018 and 2019, which shows that interest in acquiring a new property remains strong,” highlighted Ernesto Ferrer-Bonsoms, Real Estate business director at Solvia .
One of the few that talks about a drop in house prices is S&P Global Ratings. The credit rating agency affirms that they will decrease by 0.3% in 2024, to resume the increases in 2025 and 2026, with increases of 1.5% and 2%, respectively.
Likewise, not all experts estimate the same forecasts. Servihabitat Trends hopes that the demand that postponed its purchase decision to a scenario with more favorable interest rates will resume its plans in 2024, and that it will join the greater interest of foreigners and investors. They estimate that home purchase and sale operations will increase to exceed 665,000 transactions, which means a return to growth in the residential market .
Regarding price, Borja Goday, CEO of Servihabitat, highlights that the shortage of new construction and the increasingly scarce stock of quality, rehabilitated second-hand stock neutralize any possibility of a collapse in prices. However, the increase will be softer than that achieved in 2023, when an increase of 4% was recorded at the national level. Thus, the expected revaluation of housing prices is estimated at 3% by 2024.
The Gloval appraiser has also joined the forecasts for the residential market in 2024. They expect a new increase in housing prices, although slightly lower than that experienced in 2023, as long as economic conditions are maintained. Specifically, for this year it foresees an average increase in prices of 2.58%, compared to 2.88% last year, and below the average of close to 3% that it estimates for Madrid and Barcelona.