The Spanish real estate market is experiencing moderation in the face of uncertainty, adjustments in the global economy and interest rate hikes.
House sale rates are falling sharply across the board in Spain and foreigners are playing a more prominent role in the market. This is according to the latest barometer published by the Spanish Real Estate Credit Union (UCI) and the Spanish International Realty Alliance (SIRA).
Their figures show that foreign buyers now account for 22% of all sales transactions in real estate agencies, an increase of 2% year-on-year in the country as a whole, although coastal areas continue to attract more interest.
According to the agents consulted, 46% of all foreign buyers are non-residents. By nationality, the UCI and SIRA Barometer highlights Latin Americans in first place (19%), followed by British (13%), Moroccans (11%), Germans (10%) and Romanians (8%).
Foreigners' most sought-after home
When asked about the property type most in demand by foreigners, estate agents suggested that flats (60%), followed by apartments or studios (21%) and single-family homes (19%) were the most popular properties.
Most foreign buyers (68%) are buying a primary residence, followed by a second home (21%) and to a lesser extent (11%) as a rental investment.
The barometer also highlights which aspects are most valued by foreign clients, the first being proximity to services (28%), green spaces (25%) or coastal areas (18%). To a lesser extent, they prefer being close to an airport (3%), that it is a new build (10%) or that it has a good energy rating (5%).
In the case of financing, the barometer shows that 30% need bank financing to carry out the sale and purchase. This financing is requested from Spanish banks (33%) or in their countries of origin (21%), although they also consult brokers in Spain or their countries of origin (29%) or real estate agencies (17%).
Fewer buyers and stable prices
The SIRA and UCI study also summarises what the real estate agents surveyed expect for the end of the year.
In particular, most experts believe that the number of sellers will remain stable or increase while the volume of buyers will decrease in the coming months.
When asked about the evolution and their expectations regarding the closing of transactions, more than half of the agents (53%) foresee a decrease in the transaction volume. Despite this, prices will continue to fall in the coming months. At least this is what 56% of real estate experts say. For their part, 44% believe that prices could fall moderately until the end of the year.
Optimism among real estate agents
Lastly, the barometer reflects an increase in estate agents' optimism compared to the previous edition and at the same level as in the third quarter of 2022.
Employment prospects in the sector also remain stable, with 87% of real estate professionals believing that staff numbers will remain stable or increase moderately by the end of the year – a slightly lower forecast than the previous three editions of the barometer.