House prices in Spain rise 7.8%

Buying a home in Spain is increasingly difficult for Spaniards and expats alike. Prices in the second quarter of 2024 were 7.8% up on the previous year. This follows an 8% price hike two years ago.

The housing crisis in Spain continues to escalate, with access to affordable housing becoming a major economic problem. Data reveals a steady increase in housing costs over the past decade, culminating in a 7.8% rise in housing and a staggering 11.2% year-on-year increase in new construction.

The price surge in new builds – the highest since the 2007 mortgage crisis – contrasts sharply with the growing affordability issue. 

The severity of the situation has prompted widespread concern. The dean of the College of Notaries of Catalonia warned in a recent letter that the housing crisis could lead to “total disintegration” and “general resentment” among citizens.

In response, the Spanish government has pledged to address the issue. Prime Minister Pedro Sánchez announced that housing will be a key focus of the upcoming Conference of Autonomous Presidents, aiming to balance tourism and the well-being of residents. He also vowed to take action against speculators and property owners with large portfolios that are contributing to the problem.

Housing Prices Surge Across Spain: Navarra and Aragon Lead the Way

Despite continual news surrounding housing issues partly caused by mass tourism in tourist hotspots like Barcelona and Málaga, it’s the more rural, interior Navarra and Aragón that have seen the biggest increase in prices. Housing prices have risen across all autonomous communities in Spain, but Navarra and Aragon have experienced the most significant increases. Navarra saw a price surge of over 10%, while Aragon closely followed with a 9.9% rise. Other regions with notable increases include Andalucia, Ceuta, Cantabria, the Valencian Community, and La Rioja, all reporting increases of 8.6% or more.

At the other end of the spectrum, Castilla-La Mancha, Extremadura, the Balearic Islands, Galicia, and Catalonia witnessed more moderate price increases, ranging from 5.3% to 6.7%.

Steepest Quarterly Rise in Nine Years

Compared the second quarter to the first three months of the year, housing prices increased by a substantial 3.6%. This marks the largest quarterly rise since 2015. Pre-owned housing also saw a significant increase of 3.7% during this period. However, new housing prices grew more modestly, growing by 2.7% compared to the first quarter.

Concerning Rise in House Prices for First-Time Buyers

This news will be a further blow to the many people looking to buy their first home. At a time when the cost of living is already sky high, the news that owning property is becoming even more out of reach will surely be another disappointing blow to prospective homeowners across the country.

 Follow our Spanish news to find out what’s going on up and down the country.