The Spanish residential property market continues an upward trend, according to the latest report from global real estate advisor Savills.
Spanish residential property is now seeing an increase in construction activity, growing interest from overseas property investors, and steadily growing prices.
Following nearly a decade when practically no residential homes were built, construction activity is increasing. This is mainly in the key cities, but also across the country and it is forecast to increase as more residential permits are granted.
There is growing interest from overseas property investors, especially from countries in Latin America that share cultural and historical links with Spain.
The report explains that in a global context, Spanish residential property in the prime city markets offer value for money and more growth potential than other world cities.
Madrid has the most expensive prime property in Spain, with an average value of €7,000 per square metre. This represents a discount of 23.1 per cent compared with Berlin, 60.5 per cent with London and 84.6 per cent with Hong Kong, the most expensive city in the world for prime residential property.
In Barcelona, prime values are 11.4 per cent cheaper than in Madrid, standing at €6,200 per square metre. This leaves prices 24.0 per cent higher than Valencia, which, at €5,000 is the most affordable of Spain’s three largest cities.
British buyers continue to make up the largest group of foreign nationals buying Spanish residential property. They accounted for 14.8 per cent of purchases in 2018, followed by French and German buyers at 7.9 per cent and 7.6 per cent respectively. The report says that this indicates that the uncertainty leading up to Britain leaving the European Union has not deterred buyers from investing in or relocating to Spain.
During the past five years, the number of international buyers has nearly doubled. This increase coincides with the introduction of Spain’s golden visa scheme. This allows non-EU nationals to obtain residency in Spain if they invest half a million euros or more into real estate.
The scheme has driven foreign buyers to the Spanish prime markets, particularly from Morocco, China and Russia. There is also rising demand from Spanish-speaking South America. Some of the largest growth over the past five years has come from buyers in Ecuador and Argentina, with numbers rising by 270 per cent and 150 per cent respectively.
It seems that the recovery in Spanish residential property is here to stay.