The Spanish real estate market post Covid
As we wrote last year: three main trends remain active:
people are buying bigger, with more outside spaces and lights
people are buying outside big cities
foreigners are less active due to travel restrictions (but at HTBIS we could see a strong pick up in activity since end 2020)
Don’t miss our detailed update of last year: What are the impacts of Coronavirus on the Spanish Real Estate Market?
Spanish real estate return was above 10% in May 2019
Of course, the uncertainty on the economy that came from Covid was noticeable in 2020 but since 2021, the market is rebounding strongly both in terms of transactions and prices. Have a look at our Spanish real estate quarterly report for more.
Have a look at our interactive chart (yes when you come back, it will be updated)
Mortgage rates in Spain are very close to the lowest levels ever at 1.6%
1.6% in November 2021, Red line on the chart
You can always find that information updated on our “Returns & Mortgage Section” and read our article updated every month with the current mortgage conditions: Find the best mortgage rate in Spain
Maybe interest rates won’t stay that low for a long period of time… they rose to 3% during the summer of 2018 but back to 2% one year later. Another data pointing into that direction is the inflation spiking. That is why real estate investors are taking a fixed rate mortgage right now. Read more on that: Fixed or variable rates mortgage?
Have a quick look at our Spanish mortgage calculator if you want to know what is your purchasing power to buy a property in Spain:
Your mortgage calculator
We developed a detailed mortgage calculator: Payment schedule, monthly payments,…
The first real positive return since the crisis of 2008 came in early 2014 … six years ago…
As you can see on our chart, the estimated return became slightly positive for the second time since 2008 at the start of 2014. In 2010, the estimated return went slightly positive but it was not enough to compensate the mortgages costs. The performance was much stronger in 2018 as the estimated profitability was higher than 10%. Right now, with close to 6%, the estimated profitability covers by more than 3 times the current mortgages costs.
Follow this link if you want to learn more about our partner, one of the leading Mortgage brokers in Spain.
Real estate prices are lower than 10 years ago
Is there a lot of downside from here? Check the chart of real estate price evolution before and after 2007:
Spanish real estate returns have the second weakest performance in Europe on a 10-year time frame
Have a look at the comparison of the real estate market in Spain vs other European countries on any time frame between 3 months and 10 -year time frame
As you saw on this histogram, Spain has the weakest performance on a 10-year time frame. Click on the chart to check the performance for other period lengths.