Tinsa: House Prices Rose By 6.1% YoY In Large Cities In April

10 May 2017 – Expansión

House prices are continuing to rise sharply, boosted by an acceleration in the large cities and in the Balearic and Canary Islands, according to the latest estimates from the appraisal company Tinsa. Specifically, the price per square metre of properties rose by 2% in April with respect to the same month last year, according to figures published yesterday.

Although those figures are seven-tenths lower than those registered in March for the country as a whole, we cannot speak of a slowdown, given that the general trend over the last few years has been increasingly bullish. Moreover, the data also reveals a growing acceleration in several key markets, such as the large cities, where prices rose by 6.1%, and the Balearic and Canary Islands, where property prices rose by 4%.

In this way, the rise in house prices in Spain’s provincial capitals and large cities has accelerated by six-tenths with respect to the same month last year, to reach its highest rate since the outbreak of the crisis. This increase is being spearheaded by some of the prime areas of Madrid and Barcelona, where supply is constrained and demand is rocketing. Nevertheless, over the last few months, the price rises have been spreading to more and more neighbourhoods, given the strong buyer pressure in the most sought-after areas.

Meanwhile, property prices in the Balearic and Canary Islands are rising at a rate of 4%, driven by two main factors. On the one hand, the high level of demand from overseas buyers. On the other hand, the purchase of homes as investments, given that owners can rent them out easily for short-stays for most of the year, which raises their yields. Prices in these regions have fallen by 27.8% since 2007, i.e. by one-third less than the average.

On the other hand, this situation contrasts with the weakness in house prices along the Mediterranean Coast, in metropolitan areas and small towns, where there the stock of homes for sale is greater and demand is lower. (…).

Two speeds

(…). By way of illustration, house prices in the Mediterranean region are still 46% lower than their peak levels of 2007. (…).

In metropolitan areas, prices are still falling, with a decrease in property prices of 2.6%. That data also represents a slowdown of more than two points with respect to last month and is a kick in the teeth for a market that has seen its price plummet by 45.9% since the real estate bubble burst. The reason is precisely due to the fact that the crash in the market made house prices in the centre of large cities more affordable, which meant that most buyers did not have to move tens of kilometres away to buy a home.

Original story: Expansión (by P. Cerezal)

Translation: Carmel Drake

Idealista: Rental Prices Rose By 4.3% In Q1 2016

12 April 2016 – Idealista

The price of rental housing increased by 4.3% during the first quarter of 2016, taking the price per m2 to €7.40/m2/month, according to a report published by Idealista. In YoY terms, the increase amounted to 5.2%.

For Fernando Encinar, Head of Research at Idealista, “on the basis of the data in the report, it is clear that there is a huge demand for rental housing and that the supply is rising strongly. Unlike in the market for house sales, monthly rental prices are increasing in a general and uniform way across the whole country, which means that the segment is growing in a robust and stable way”.

“Moreover, at Idealista we have found that in certain markets, primarily, major capitals, the pressure of demand is so great that adverts are appearing on our database for just a few hours…(…)”.

By autonomous region

All of the autonomous regions recorded higher rental prices than three months ago, with the exception of Euskadi (where they decreased by 4%). The greatest increase was recorded in the Balearic Islands, where prices rose by 11.2%. That was followed by increases in Madrid (5.2%), Valencia (5%) and Cataluña (4.7%). By contrast, the smallest increases were observed in Extremadura (0.3%), Cantabria (1%), Canarias (1%) and Castilla La Mancha (1.2%).

Madrid (at €11.5/m2/month) is still the most expensive autonomous region. It is followed by Cataluña (€11/m2/month), the Balearic Islands (€10/m2/month) and Euskadi (€9.6/m2/month). At the other end of the table, the most affordable autonomous regions are: Extremadura (€4.1/m2/month), Castilla La Mancha (€4.4/m2/month) and La Rioja (€4.9/m2/month).

By province

Rental prices also increased in 38 provinces over the winter. The highest increase was recorded in the Balearic Islands, where prices rose by 11.2%. Significant price increases were also recorded in Valencia (6.7%), Pontevedra (5.9%), Huelva (5.5%) and Madrid (5.2%). Meanwhile, the largest decreases were registered in Tarragona (-8.6%), followed by Vizcaya (-6.1%) and Cáceres (-1.8%).

The ranking of the most expensive provinces is led by Barcelona (€12.6/m2/month), Madrid (€11.5/m2/month) and Guipúzcoa (€10.2/m2/month). Jaén is the most affordable province for renting a home, at €3.7/m2/month. It is followed by Cáceres and Ávila (€3.8/m2/month in both cases).

By capital city

Valencia is the capital city where rental prices rose by the most in Q1, with growth of 8.8%. Significant rental price increases were also recorded in Santa Cruz de Tenerife (7.5%) and Palma de Mallorca (6.5%). At the other end of the spectrum is Bilbao, where owners are now asking 5.8% less to lease their homes than they were 3 months ago. That was followed by decreases in Ávila (-3%), Tarragona and Jaén (-2.8% in both cases).

Barcelona strengthened its position as the most expensive capital (€15.2/m2/month), followed by Madrid (€12.9/m2/month) and San Sebastián (€11.7/m2/month). Meanwhile, the most affordable capitals were Lugo and Ourense, with prices of €4/m2/month and €4.3/m2/month, respectively.

Original story: Idealista

Translation: Carmel Drake