It’s that time again: let’s take a look at the House Price Index (HPI) data for the final quarter and build a picture of housing market movement for the previous year. It will help you gauge the mood of buyers and understand which areas are seeing strong growth.
So, this week we’re looking at the position as we closed out 2018 – and we’re pleased to say it makes for pretty positive reading.
End of 2018 – What’s the overall picture?
The official house price index for quarter 4 of 2018 has confirmed that Spain is seeing a continued housing recovery. After the crash of 2008, prices fell sharply through to 2012 and remained stagnant for most of 2013 and 2014, but we’re seeing a slow and steady rise since then. In fact, Q4 2018 was the 19th successive quarter of growth, with house prices up 6.6% year on year. This upward trend can be seen in both new build (8.0% growth) and resale properties (6.4% growth).
Which regions are driving Spanish house price growth…?
The strongest price rises are being seen in Spain’s principal cities of Madrid (up 9.6%), Barcelona (Catalonia up 8.2%) and also the centre of affluence in the Balearic Islands (up 6.4%).
Meanwhile notable price growth was also seen in Aragon (6.2%), Cantabria (6.2%), Andalucia (5.6%) and La Rioja (5.5%) – all mainland regions with easy access to the coast. The rise in popularity of these areas suggests that overall buyers may be shying away from the highly priced islands and looking to get the most they can for their hard-earned Euros.
…And which are experiencing the best recovery?
If we compare prices to their pre-crisis peaks, the Balearics, Andalucia and Madrid are now closest to being fully recovered. The Balearics is currently just 11% below their all-time high, while Madrid is 15% below its peak.
Unsurprisingly the recovery has not been uniformly felt across the country. At the bottom of the scale, Navarra’s prices remain only 40% of what they were before the crisis. But even so, the area is showing good signs of recovery.
What does this mean for you?
As expected, Spain’s housing market has seen a continued upward trend in 2018, and we believe that this is likely to continue in at least the short term.
As agents you should be buoyed by this and reflect this confidence to your potential buyers. By considering areas that are experiencing strong growth you can help buyers to understand the risks and find the best property investment for them.
Keep an eye on Kyero’s Market Insight for more useful data.