Property prices in Spain 2022: Are house prices going to drop in Spain? Is it a good time to buy property in Spain 2022? Uncertainty and the energy crisis will take their toll on the Spanish housing market in 2022 and 2023, meaning that potential buyers need to carefully consider if now is the correct time to buy or not. This is also the case if you are considering selling property in Spain in 2022. Bankinter's new strategy report and property market forecast for 2022 and 2023 lowers its initial outlook for house prices from an estimated 2% rise in 2022 year to 1%, which means they will increase by less than inflation. For 2023 it also forecasts that house prices will rise by a moderate 1%, which means a slowdown in house prices, after the 6.4% increase in 2021. So, with property prices in Spain in 2022 expected to rise less then expected, let's find out the details.
Bankinter continues to see no "signs of overheating" in house prices in Spain, as reflected in its latest report on the real estate sector, as they are "well supported" with effort rates still below the historical average and balance between supply and demand.
- On the one hand, the effort rate of households in Spain when it comes to paying a mortgage, i.e. the percentage of disposable income they devote to paying monthly instalments, stood at 33% at the end of last year and is expected to remain at levels of 35%, the historical average for the last few years.
- On the other hand, there is a certain balance between supply and demand. The Analysis and Markets Department estimates that there is a structural demand for housing of around 100,000 units per year, distributed between the 70,000 that would come from the creation of homes and 30,000 from foreign demand. In the case of supply, the number of housing starts is at a similar level (in fact, it closed 2021 with 100,000 properties under construction) and the forecast is that this threshold will be exceeded in 2022 and 2023 to cover the supply deficit of recent years.
Likewise, the Investment Strategy Report Análisis y Mercados points out that it foresees a certain cooling in real estate activity. In terms of housing transactions, these could fall by 5% this year, after reaching 15-year highs last year, when they exceeded half a million sales.
Foreigners and their thirst for Spanish properties
Foreign homebuyers in Spain are at an all-time high (15%), according to the Yearbook of Property Registrars, and barely 1.7% lower than 2022 sales records, with just over 87,300. The British (9.5%), Germans (7.3%) and French (6.7%) are once again the main foreign homebuyers.
Cheap property for sale at auction in Spain
Property auctions in Spain can be an exciting and potentially lucrative way to purchase real estate. Buying property at auction allows you to get your hands on a house in Spain for considerably less than the market value. These types of properties come mostly from bank assets, but there are also individuals who opt for this type of formula to sell their home. Some may be in good condition while others may require renovation.