·         Date: 11 Dec 2024
The real estate market continues to rise: new and used housing show an upward trend
The price of free housing registered a year-on-year increase of 8.1% in the third quarter of the year, marking an increase of three tenths compared to the previous quarter. This figure represents the largest increase since the first quarter of 2022, when the increase was 8.5%. With this figure, the real estate market statistics have now accumulated 42 consecutive quarters of increases.
According to the Housing Price Index (IPV) published by the National Institute of Statistics (INE), the boost in prices was led by new housing, which grew by 9.8% year-on-year, although this rate is 1.4 points lower than that of the previous quarter. For its part, second-hand housing showed a rise in prices of 7.9%, the largest increase since the second quarter of 2022 and six tenths higher than in the previous quarter.
New housing: a slight respite after months of significant increases
Although new housing continues to rise, the 9.8% year-on-year increase represents a slowdown compared to previous quarters, when increases exceeded 10%. This performance contrasts with the record of 11.2% recorded between April and June, the highest rate since the 2007 crisis. Factors such as the rise in the cost of construction materials, logistical problems and low levels of production in new construction continue to put pressure on prices.
The second-hand market: a decade of unbeatable increases
Used housing has accumulated more than ten years of year-on-year increases, starting this streak in the second quarter of 2014. During the third quarter of 2024, prices increased by 7.9% compared to the same period of the previous year, standing out for its upward stability in a market of high demand.
Quarterly increases slow down
In quarterly terms (comparing the third quarter with the second), the price of free housing rose by 2.8%, a slowdown of eight-tenths compared to the growth of the previous quarter. This behaviour was observed in both new and used housing, both registering an increase of 2.8%, although new housing showed a slight acceleration compared to the previous quarter.
Outlook: housing prices will continue to rise
According to María Matos, director of Studies at Fotocasa, the real estate market reflects a combination of sustained demand, favourable mortgage conditions and insufficient supply. This situation, aggravated by the fall in interest rates by the European Central Bank (ECB) since June, is stimulating demand and pushing prices up. Data from Fotocasa Research shows that 15% of the Spanish population is looking to own a home, compared to 12% in 2019. In addition, a significant percentage of demand comes from solvent buyers with high purchasing power and an investment focus, including international buyers.
The General Council of the Official Colleges of Real Estate Agents of Spain points out that the mismatch between housing supply and population growth, especially in the main metropolitan areas, remains a key factor in rising prices.