House prices depend on many factors: the year it was built, its type, characteristics and location, especially if in a tourist area. CaixaBank Research put numbers on the price of homes located in such towns in Spain and found that the per square metre price is up to 75% more expensive.
To reach this conclusion, the financial institution's research department based its analysis on data published by the Ministry of Housing (MIVAU) on the assessed value of homes in a total of 306 towns and cities in Spain and applied its criteria to determine which are tourist properties and which are not. Specifically, it considers tourist properties to be those with a bank's POS expenditure of more than 10% of the total.
As detailed by CaixaBank Research to idealista/news, of the 306 localities with house prices available, 21% are considered tourist towns, as they meet the criteria. They include 64 locations "in which 34% of the population of the 306 towns considered live," and among them are Madrid, San Sebastian, several Mediterranean provincial capitals (Barcelona, Valencia, Alicante and Palma) and some Costa del Sol cities (Malaga and Marbella).
Property price evolution in Spain
The average property price in these 64 tourist towns stood at €2,943/m2 at the end of last year. Meanwhile, the average of locations not included in this category stood at €1,689/m2.
Although the m2 of the towns popular among tourists is not at record highs (at the end of 2007 and the beginning of 2008, the m2 was above €3,000), the difference compared to the other areas is record-breaking. The average price of non-tourist towns is at its highest level since the summer of 2011, while tourist areas are at their highest since the summer of 2008.
According to data from the financial institution's research department, the gap between the two figures reached 74.2% in the fourth quarter of 2023 and was close to 75% in the first three months of that year, marking the largest 'gap' in the historical record. In contrast, in 2007-2008 the gap between the two prices per m2 was less than 40%.
Average prices double in Madrid, Barcelona and San Sebastian
Looking at the average appraised value published by the Ministry of Housing and Urban Agenda for the last quarter of 2023, we find that not all of these towns considered to be tourist destinations have the same price difference compared to other areas. This is the case in the ten most populated areas – Madrid, Barcelona, Valencia, Malaga, Palma, Alicante, Granada, Elche, San Sebastian and Marbella – according to CaixaBank Research.
In the case of San Sebastian, Madrid and Barcelona, the current per square metre is more than double the non-tourist average, while Marbella is the next highest, with an overpricing of close to 80%. Already below the average of 74.2% are Palma (61.4%), Malaga (39.2%), Valencia (17%) and Granada (9.3%), while in the case of Alicante and Elche the per-square-metre price is below the average for areas with less tourist interest, with negative differences of 4.5% and 31%, respectively.
Biggest rise since the real estate recovery
According to the bank's research service, housing in areas with more tourists has increased more than in the rest of the market consecutively in the last two years (since summer 2021).
If we focus on the most recent data, the year-on-year increase in housing prices in tourist locations stood at 5.7% during the first quarter of last year, compared to the average of 4.8% recorded by the rest. In spring, the increase in the first case was 4.6%, three-tenths of a percentage point higher than that experienced by non-tourist towns, while in summer, the increase was 6.6% in tourist markets, compared with 4.9%. The trend continued at the end of the year, increasing 7.5% in tourist towns and 5% in the others.
The trend, however, has been observed since the start of Spain's real estate recovery following the impact of the economic and financial crisis and the bubble bursting. Since then, tourist towns have recorded much higher average house prices and risen more sharply, according to the CaixaBank Research analysis.
Thus, between the fourth quarter of 2014 and the fourth quarter of 2023, the average house price in tourist towns increased by 61%, while in other towns, the rise was 38%, with a difference of 23 percentage points.
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