By looking at house price data across multiple years we can start to see trends and patterns forming over time. Information from the previous year can be used by agents to make decisions in terms of planning and growth strategies for the new year.
While we can never be certain about the future, the patterns that have emerged during this year have certainly been positive.
What’s the overall picture for 2018 house prices?
Looking at the data from the Q3 2018 House Price Index (HPI) from INE.es we can see an extremely positive picture. The figures show an 18th successive quarter of house price growth with average house prices up 7.2% year on year across both new builds (6.1% growth) and resales (7.3% growth). Prices have continued to exceed their early 2012 levels from before the crash of 2007/8.
Which regions are seeing the biggest house price growth?
While nowhere has yet seen a return to the peak house prices we were seeing at the beginning of this decade, some regions have certainly seen a good recovery in recent times.
While the Balearics have seen the most sustained bounce back of all of the regions, reaching almost 90% of their pre-crash peak, Madrid has achieved the biggest growth this year. Boasting a 10.9% increase in house prices in 2018, the region has grown to just over 80% of its highest recorded levels.
Other regions that have experienced strong recovery are Andalucia, the Canary Islands, Galicia, Murcia, Valencia and Catalonia, all of which have recovered to at least three quarters of their peak prices. Strong price growth in the last 12 months has been seen in Catalonia (9.1%), the Balearics (7%), La Rioja (6.7%), Cantabria (5.7%) and Castile Y León (5.7%).
The house price growth in the northern regions of La Rioja and Castile Y León has been buoyed by new build sales – with price growth of 8.8% and 9.7% respectively in new builds in these areas. This could be driven by the increasing popularity of the relatively cooler climate and cheaper land of northern Spain as well as easy access by high-speed train into Madrid from these regions.
What do we expect from 2019?
The market is buoyant with investor interest spread across all areas of Europe and the US. This spread of interest gives us confidence that despite political challenges across western Europe, we should continue to see strong growth and upward trends in prices achieved on Spanish property into the new year.
We expect to see a continuation of the current trend for growth in mainland regions with easy access to the coast, as buyers shy away from the highly priced islands and look to get the most they can for their hard-earned Euros.
What does this mean for you?
This recent HPI data should give you reason to feel confident in the market outlook and to seek opportunities to invest in the growth of your business. Investing in regions such as La Rioja, Cantabria and Castile Y León, that have seen strong price growth over the last year but have not yet recovered to their pre-crash peaks, could see good returns through 2019.