Average Land Prices Rose By 9.7% To €156.4/m2 In Q3

16 December 2015 – Expansión

The average price of urban land is starting its recovery. During the third quarter of 2015, the average price of land sold in Spain amounted to €156.4/m2, up by 9.7% compared with the previous year, according to statistics from the Ministry of Development. This increase is five percentage points higher than the one recorded in the previous quarter.

This price increase, the highest in a decade, is due, above all, to the recovery experienced in municipalities with more than 50,000 inhabitants, where urban land prices increased by 58.7% YoY, to reach €331.1/m2, the highest figure since Q4 2012.

This sharp increase has two main explanations. Firstly, there are more operations than before, and they are more expensive. 9.2 million m2 of land was sold, with a value of €790.2 million (representing an increase of 72.3% YoY in terms of surface area and 18.4% in terms of value). With such low starting points, the increases are very significant. Secondly, the volume of transactions is not yet sufficient for us to stop talking about volatility.

Cities in Murcia experienced the highest increase in urban land prices in the third quarter (by 189.2% YoY), followed by cities in Castilla y León (74%), Asturias (69%) and the Community of Madrid (63%).

At the opposite end of the scale, municipalities with more than 50,000 inhabitants in Castilla-La Mancha recorded the highest depreciation in the price of land allocated for the construction of buildings (-27.5%), followed by those in the Canary Islands (-14.7%) and those in the Balearic Islands and PaísVasco, which recorded decreases of 4.1% in both cases, according to the breakdown of the Government’s statistics, which were compiled using data from the Association of Property Registrars (el Colegio de Registradores de la Propiedad).

Historically low prices in Sevilla

The highest average prices in municipalities with more than 50,000 inhabitants, were recorded in the provinces of Madrid (€660.4/m2, the highest price since Q2 2012), Guipúzcoa (€557.1/m2) and Barcelona (€539.1/m2). The lowest prices were recorded in the provinces of Albacete (€36.7/m2), Sevilla (surprisingly, at €128.1/m2, the lowest average price since the Ministry of Development began to compile records in 2004) and Cádiz (€141.6/m2).

During the third quarter of 2015, 4,192 transactions were closed, up by 9.8% compared with the second quarter 2015 and 2.4% fewer than in Q3 2014, when 4,293 plots were sold.

447 transactions were recorded in municipalities with fewer than 1,000 inhabitants, an increase of 1.1% compared with the same quarter a year earlier; in municipalities with between 1,000 and 5,000 inhabitants, 694 plots were sold, down by 20%. In towns with between 5,000 and 10,000 inhabitants, 554 plots were sold, down by 2.5% YoY. In towns with between 10,000 and 50,000 inhabitants, 1,738 transactions were recorded, up by 22.6%. And in cities, 769 plots were sold, down by 23.7%.

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake