The real estate market on the coast has been on an upward trend in 2021 which translates to rising sales and prices. Recent data for January 2022 reaffirms this tendency, but how will the market perform for the rest of the year?
Read on for our pick of the most prominent real estate trends on the Costa del Sol for 2022.
Falling inventory
The latest data for sales of property on the Costa del Sol points to a busy market. In the first eight months of 2021, some 20,600 homes changed hands. This figure represents a 40% hike in the same period in 2020, an increase that we must put into perspective. It’s true that most of the months between January to August 2020 were subject to Covid restrictions with minimal mobility. So, it’s no surprise to see a 40% spike.
But we must compare like with like and turn to figures for January to August 2019. In those eight months, 20,526 sales took place on the Costa del Sol, very slightly below those for this year. The conclusion? Sales are back (and ahead of) pre-pandemic levels.
Data from August 2021 reflects the same trend. This high-season holiday month tends to be quieter in the real estate world, but not this year. 3,246 sales took place, on a par with those seen in 2007 and 2008.
New builds rule the market
New-build properties on the Costa del Sol offer larger homes with higher quality finishes than resales and those two characteristics are currently in high demand. Since the beginning of 2021, the new-build market has stormed ahead of the resale in terms of sales and prices.
In August 2021, there were 1,072 sales of new properties on the Costa del Sol. The monthly figure is the highest since 2013. With plenty of demand still in the pipeline, we believe that this trend, too, is set to continue for 2022.
Rising prices
Like sales, house prices on the Costa del Sol are moving fast. According to Tinsa, in Q3 they went up by 10.7%, the second-highest figure in Spain in areas popular with foreign buyers. Only the Balearics posted a higher figure (11.9%).
Localised figures also reveal solid increases for Costa del Sol real estate. For example, Idealista data shows that Marbella and Estepona were the two areas in Spain with the highest price hikes over the last two years.
Marbella took 4th, 6th and 7th positions in the top ten in the country. Property prices in Nagüeles skyrocketed by 42.1% between August 2019 and August 2021, with homes in Las Brisas and Bello Horizonte experiencing hikes of 38.1% and 34.1%, respectively.
Estepona stood in 8th position on the table. In the Guadalmansa district, real estate prices rose by 33.8% in the two years.
Cheap mortgages
The Euribor, the European Central Bank benchmark for Spanish mortgage interest rates, first dropped below 0% in March 2015. Since then, it has hovered below zero and in mid-October this year, the Euribor 12-month rate stood at -0.467%, its lowest ever.
Low-interest rates make for cheap mortgages, much cheaper in this case and unsurprisingly, home loan approvals have risen continuously throughout 2021. The latest data from the Spanish Institute of Statistics (INE) reveals that mortgages went up by 36.8% in the year to July. Furthermore, the loans were for larger amounts – 136,527 was the average, 3.8% higher than July 2020.
Bottom line? There has probably never been a better time to take out a mortgage in Spain.
Source: Spanish Property Insight
