Housing prices will continue to be in the news this year, after the spectacular reactivation of sales that has generated the interest rate cuts undertaken by the ECB since June. The latest available data, corresponding to November 2024, show that a total of 60,913 houses were sold in that month, 9% more than in the same month of 2023, despite the fact that the average price per square meter increased by 5 .9%, reaching 1,723 euros, according to data from the General Council of Notaries.
It was the most expensive November since 2007, when in the run-up to the bursting of the brick bubble, each meter of housing reached an average price of 1,800 euros, only 4% above what it is worth today. What already anticipates that 2025 may be the year in which the unit value of housing (new and second-hand) exceeds its historical maximum (1,790 euros on average in 2007), after doing so last year for brand new houses. .
For now There is no indicator that contradicts that the year that has just entered will be the best for the residential sector since 2007. The significant traction that sales have gained in recent months means that, between January and November 2024, 644,347 housing transactions have been recorded, more than in all of last year, when 642,432 were carried out, according to notaries. A ‘boom’ that will continue in the coming months and that will be accompanied by price increases, although experts, as this newspaper already reported, assure that it will not be of the same vigor as seen during the last year.
The evolution of the price will go by neighborhoodsas also happened last November. In that month, transaction value growth was above average in Canary Islands (18.8%), Cantabria (16.0%), Aragon (12.5%), Madrid (12.3%), Valencian Community (12.3%), Castile and León (10.0%), Balearics (9.9%), Andalusia (7.7%) and Catalonia (6.2%). In total, 15 different autonomous communities saw housing prices increase. Only two retreated: Navarre (-13.0%) and Galicia (3.2%).
By typology, the prices of apartments – which represented the vast majority of operations, as usual, with 46,750 units – increased by 7.5% compared to the same month of the previous year, reaching 1,955 euros per meter of surface, while the price of single-family homes (houses, chalets) averaged 1,311 euros per square meter, 4.1% more compared to 2023, after sales increased by 13.7% year-on-year and reached 14,342.
Return of the middle class
The strength of the market is explained by the return of the middle class to the market, after two years of hiding waiting for a mortgage relaxation, in which investment purchases by individuals and companies have managed to sustain the sector, representing many months most operations. This return of the ordinary citizen is certified by the growth of mortgage loans for housing, which grow almost three times as fast as the sales themselves. In November, for example, its increase was 24%, to 29,464 signatures, with an average amount of these loans of 156,327 euros, 8.5% more than in the same month of 2023, according to the General Council of Notaries.
The forecast is that a very large number of citizens will come to the market in the next twelve months, taking advantage of the mortgage truce situation and the banks’ offensive to attract clients. But many of them will be forced to acquire a property beyond their financial expectations, in locations other than those desired and in conditions that do not correspond to their expectations. There will be three of the effects caused by the shortage of housing supply that Spain suffers, especially in the large capitals and their neighboring municipalities. The experts’ forecast is that this deficit will continue to accumulate this year and will exceed half a million missing homes, according to the latest forecasts from the Bank of Spain.
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