Rental Prices Fell 6.1% in October, the Largest Drop in 10 Years

Rental Prices Fell 6.1% in October, the Largest Drop in 10 Years

In Spain, rental housing costs decreased by 0.5% compared to the previous month and by 6.1% year-on-year in October, reaching 10.09 euros/m² per month.

The annual drop in rental prices (-6.1%) was the most significant in 10 years — since November 2011 (-6.4%), according to the Fotocasa real estate index.

“The downward trend in the rental market continues; this drop is a direct consequence of the market transformation after the pandemic, when rental demand decreased by several percentage points due to remote work and students returning to their home provinces; simultaneously, housing supply that was frozen is gradually entering the market, which additionally pressures prices,” explains María Matos, director of the analytical department and spokesperson for Fotocasa.

“We have been recording a decline since the beginning of the year, but it is becoming increasingly intense, which helps the most strained areas improve housing affordability — such as in the communities of Madrid and Catalonia; the year will likely end with this downward price dynamic,” adds Matos.

Rental prices decreased in six autonomous communities. Madrid leads with an 8% drop, followed at a distance by Catalonia (-3.6%), Andalusia (-1.2%), Canary Islands (-1.1%), Aragon (-0.8%) and the Basque Country (-0.1%).

Conversely, prices rose in the remaining regions: Cantabria (5.9%), Extremadura (4.4%), Murcia (4.3%), La Rioja (3.4%), Asturias (2.8%), Balearic Islands (2.4%), Galicia (2.3%), Castile and León (2%), Valencian Community (1.2%), Navarre (0.8%) and Castile-La Mancha (0.7%).

In the ranking of autonomous communities with the most expensive rentals, Catalonia and the Basque Country lead — 13.77 euros/m² and 13.37 euros/m² per month respectively, followed by Madrid with 13.35 euros/m², Balearic Islands with 11.92 euros/m², Navarre with 9.82 euros/m², Canary Islands with 9.56 euros/m², Cantabria with 9.20 euros/m², Valencian Community with 8.49 euros/m², Andalusia with 8.45 euros/m², Aragon with 8.43 euros/m², Asturias with 7.97 euros/m², Galicia with 7.26 euros/m², La Rioja with 7.25 euros/m², Castile and León with 7.23 euros/m², Murcia with 7.20 euros/m², Castile-La Mancha with 5.78 euros/m² and Extremadura with 5.51 euros/m².

What about the provinces?

Rental prices decreased in 9 out of 47 provinces analyzed by Fotocasa. Madrid led the decline (-8%), followed by Albacete (-5.6%), Seville (-4.7%), Barcelona (-3.6%), Las Palmas (-1.7%), Jaén (-1.7%), Ávila (-1.5%), Ourense (-1.4%) and Santa Cruz de Tenerife (-0.9%).

On the other hand, the largest increases were recorded in Huelva (17.6%), Castellón (10.9%), Almería (10.7%), Badajoz (8.7%), Segovia (8.5%), Lleida (7.4%), León (6.6%), Cantabria (5.9%), Lugo (5.2%) and A Coruña (4.5%).

Only five provinces exceeded the average rental cost of 10 euros/m² per month. The most expensive province was Gipuzkoa — 15.63 euros/m², followed by Barcelona — 14.67 euros/m², Madrid — 13.35 euros/m², Biscay — 12.70 euros/m² and Balearic Islands — 11.92 euros/m². The province with the lowest price was Cáceres — 5.08 euros/m² per month.