Fernando Encinar

The rise in the cost of renting in Spain is worrying not only politicians, but also the private sector. Faced with a lack of supply in some Spanish cities and an increase in demand, rental prices have risen faster than wages.

On Monday 17th June 2019, a new mortgage law came into force in Spain, having arrived late and with many changes, such as an article that is generating a lot of uncertainty in the Spanish real estate sector.

The Spanish Council of Ministers has approved new legislation with a royal decree law reforming the rental market.

The Plenary Session of the Congress of Deputies in Spain has rejected the Royal Decree Law 21/2018, of 14th December, on urgent measures of housing and rent by 241 votes against, 103 votes in favour and 1 abstention. On 19th December 2018 the reform of the rental market prepared by the Spanish Gove

The rate of growth of the price of rented housing softened in Spain in 2018 and ended the year with an increase of 9.3%, leaving the average rental price per square metre at 10.60 euro per month, which is 98 cents per square foot per month.

The number of property transactions in February increased by 16.2% year-on-year to 41,480 transactions, according to the National Institute of Statistics (Instituto Nacional de Estadística or INE).

The cost of renting property has increased by 8.8% in the first quarter of 2018, to 10.60 euro/m2 (1 euro/sq ft) per month. According to the report on rental prices published by idealista, all the autonomous regions in Spain recorded increases between January and March.

The price of used housing in Spain saw a quarterly increase of 2.2% in the first quarter of 2018. This leaves the price per square metre at 1,621 euro and the price per square foot at 150 euro, according to the latest idealista price index.

Property purchases started the year with record figures. In January, 47,289 transactions were registered, the highest figure since May 2008, and an increase of 23.1% year-on-year, according to data from the Spanish National Institute of Statistics (Instituto Nacional de Estadística or INE).

The state of the rental market shows two markedly different Spains. According to research by idealista, rental prices in 11 Spanish provincial capitals are more than they were at the height of the property boom, with Madrid, Barcelona, Malaga and the islands increasing more than 10%.

As expected, property transactions in 2017 by far outstripped 450,000 operations, according to data from the Spanish National Institute of Statistics (Instituto Nacional de Estadística or INE).