If you look at the quarterly reports on real estate on the Costa del Sol for 2021, you can see that sales and prices tended to increase. The latest data for January 2022 also confirms this trend, but how will the market behave in the rest of the year?
The number of real estate objects is decreasing
The latest data on real estate transactions on the Costa del Sol indicate a lively market. In the first eight months of 2021, about 20,600 homes were sold. This figure is 40% more than in the same period in 2020, and we must consider this growth in the long term. Indeed, for most of the months from January to August 2020, travel restrictions related to Covid-19 were in effect. Therefore, it is not surprising to see an increase of 40%.
But it would be more correct to compare the changes without the impact of the restrictions associated with the pandemic. Let’s turn to the figures for the period from January to August 2019. During these eight months, 20,526 sales were made on the Costa del Sol, which is quite a bit lower than this year’s figures.
Conclusion? The number of transactions has returned and even exceeded the pre-pandemic level.
The data for August 2021 reflect the same trend. This holiday month at the height of the season is usually quite calm in the real estate market, but not this year. 3246 transactions were made, which corresponds to the indicators of 2007 and 2008.
The most liquid objects from the sale ads currently spend very little time on the market, leaving a large number of potential buyers disappointed. And since the borders for international travel are opening up again, this situation is unlikely to change this year.
The result? If you have looked at the property you like, it’s time to buy it now!
New buildings are leading the market
New buildings on the Costa del Sol offer more spacious housing with better finishes than secondary real estate. For potential buyers, these two parameters are currently very important, therefore, since the beginning of 2021, the new building market has been ahead of the secondary market in terms of the number of transactions and prices.
In August 2021, 1,072 new buildings were sold on the Costa del Sol. This indicator (the number of transactions per month) is the highest since 2013. Since the demand for real estate has not dried up yet, this trend will continue in 2022.
Rising prices
Like the volume of sales, house prices on the Costa del Sol are rising rapidly. According to Tinsa, they grew by 10.7% in the third quarter, which is the second largest indicator in the Spain is among the areas popular with foreign buyers. Only in the Balearic Islands is this figure higher (11.9%).
The Idealista data also shows a significant increase in real estate prices on the Costa del Sol. For example, they show that Marbella and Estepona is the two regions of Spain with the highest price increases in the last two years.
The cities of Marbella took 4th, 6th and 7th places in the top ten real estate price growth in the country. Real estate prices in Naguelles soared by 42.1% between August 2019 and August 2021, while housing in Las Brisas and Bello Horizonte rose by 38.1% and 34.1%, respectively.
Estepona took 8th place in this list. In the Guadalmans area, real estate prices have increased by 33.8% in two years.
The result? High demand and reduced supply mean that prices are unlikely to decrease in the near future.
Cheap mortgage loans
The European interbank rate Euribor, which banks use to calculate mortgage interest rates in Spain, fell below 0% for the first time in March 2015. Since then, it has consistently stayed below zero, and in mid‑October 2021, the 12-month Euribor rate was -0.467%, which is the lowest figure in history.
Low interest rates make mortgages cheap, so it is not surprising that their number has been growing steadily throughout 2021.
According to the latest data from the Spanish Institute of Statistics (INE), the volume of mortgage loans increased by 36.8% last year (by July 2021). In addition, loans were issued for larger amounts — an average of 136527 €, which is 3.8% more than in July 2020.
The result? Perhaps there has never been a better time to apply for a mortgage in Spain.
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