House prices in Spain will close 2024 with an increase of up to 3%

Housing will continue to rise in 2024. During the first quarter of 2024, the Spanish real estate market experienced a recovery in the volume of transactions, although with lower figures than those recorded at the beginning of 2023, and a slight increase in property prices. According to the 1st Solvia Market View 2024, a slight upturn in the cost of housing is expected towards the end of the year, with increases ranging between 2% and 3%, mainly due to the supply shortage in the market.

House price overview in Spain

According to this study, in the period between January and March 2024, housing prices reached €1,998/m2, reflecting an increase of 0.8% compared to the previous quarter and 4% compared to the same period in 2023. In the new build sector, a year-on-year increase of 4.7% and a quarterly growth of 3% were observed, reaching €2,233/m2. On the other hand, used housing prices also showed a year-on-year upward trend, with a growth of 3.6%, standing at €1,940/m2, although they experienced an adjustment of 0.2% in year-on-year terms.

The analysis by province reveals that the highest prices were recorded in Guipuzcoa and Madrid, surpassing even the Balearic Islands, which in the previous quarter was the most expensive province. In these three markets, the average value of residential properties exceeded €3,000/m2. Likewise, among the 22 provinces that experienced quarterly increases, Cordoba stood out with an increase of 32.8%, Caceres grew 24.9%, and Soria rose 14.6%. In contrast, Ciudad Real, Segovia and Huesca showed the largest decreases, with falls of between 7% and 9.2%.

In terms of the two main Spanish cities, the average price of a home in Madrid fell slightly by 1.5% quarter-on-quarter to €3,722/m2. However, compared to the same period last year, an increase of 4.1% was observed, two points below the 6.1% recorded in the previous quarter. In Salamanca and Chamberí, recognised as Madrid's most exclusive neighbourhoods, property values increased by 8.4%, making them the most expensive. In Barcelona, prices reached €3,701/m2, with a slight decrease of 0.4% compared to the last quarter of 2023 and a year-on-year increase of 3.4%. Sarria-Sant Gervasi remained the most expensive district in the city, surpassing the €5,000/m2 barrier. It was followed by Les Corts at €4,495/m2 and L'Eixample at €4,283/m2.

Transactions will close the year with an adjustment of between 3% and 5%

In total, 151,476 transactions were carried out, representing an increase of 16.6% over the previous quarter, indicating a recovery in activity. However, this figure represents an adjustment of 5.9% compared to the same quarter last year.

In terms of property type, new home sales reached 31,226 transactions, 20.6% of the total, reflecting a quarterly increase of 30.1% and a year-on-year rise of 2.5%. On the other hand, there were 120,250 second-hand sales, accounting for 79.4% of the total and 13.6% higher than in the previous quarter, although 7.9% less than in the same period of 2023.

Only Badajoz, Jaen and Cuenca showed decreases compared to the previous quarter, with drops of 1.1%, 4% and 8.9%, respectively. By contrast, 47 provinces experienced increases, of which 33 recorded double-digit growth, with Lugo standing out, with an increase of 51.5%, Huesca, with a rise of 45.1%, and Navarra, where the figure increased by 41.7%. In terms of the volume of transactions, Madrid, Barcelona and Alicante were the areas with the greatest activity.

Along with the increase in property sales, mortgage lending has also resumed an upward trend. During the first three months of 2024, 108,910 mortgages on homes were recorded, representing a significant quarterly increase of 21.1% after six consecutive periods of decline, indicating a recovery in the sector. However, this indicator is 0.5% below the same period in 2023, when 109,406 mortgages were granted.

Barcelona, Madrid and the Balearic Islands stand out as the most expensive areas for rent

According to the 1st Solvia Market View 2024, rent continued to rise in the first quarter, reaching €12.5/m2 per month, representing an increase of 2.5% compared to the previous three months and an even more notable increase of 7.8% compared to the same period in 2023.

Barcelona continues as the province with the highest rent, with an average value of €17.9/m2 per month, while the Community of Madrid with an average value of €16.8/m2 per month surpassed the Balearic Islands (€16.6/m2 per month), and positioned itself as the second most expensive area in Spain for renting. On the other hand, much cheaper prices were observed in Jaen, Zamora, Caceres and Teruel, ranging between €5.9 and €6.1 per square metre.

New building permits to fall by 10%-13% in 2024

As reflected in the 1st Solvia Market View 2024, 25,284 permits were issued for building new homes. This represents a drop of 5.3% compared to the previous quarter and a decrease of 11.1% compared to last year, indicating a downward trend in granting building permits. Barcelona, Seville, Malaga, Alicante and the Balearic Islands were the areas with the highest number of authorisations for construction projects, accounting for 42% of the national total.

Overview of coastal housing in Spain

The growth of tourism, the start of the summer season and the economy's gradual improvement mean that it is now a good time to invest in a second home in coastal areas, both for investors and private individuals.

Taking as a reference the appraised value of free housing in towns with more than 25,000 inhabitants in the first quarter of 2024, the coastal areas with the highest house prices include Santa Eulalia del Río in Ibiza, Balearic Islands, with a cost of €5,195/m2, Ibiza Town itself (€4,625/m2), San Sebastián (€4,378/m2) in Guipúzcoa, Calvià in Mallorca (€4,273/m2), Castelldefels (€3,628/m2) in Barcelona, Getxo (€3,334/m2) in Vizcaya, and Marbella (€3,255/m2) in Málaga. 
The cheapest areas include Burriana (€840/m2) and Benicarló (€1,069/m2) in Castellón and El Ejido (€1,059/m2) in Almeria.