Spanish Property Market: December 2020 News

We are just minutes away from the New Year. All that's left to do is work a couple of hours, wrap some presents, buy food & champagne, and... read some Spanish real estate news for the past month! Read our final digest for 2020 now!

The Spanish real estate market is recovering by the end of 2020. This is stated in the new report of the Spanish Institute of Statistics. Thus, in the third quarter, people bought ⅓ more housing than in the second (102,197 sales against 76,545). If we compare the number of transactions with 2019, the decline was -16% (-21.58% in the secondary market, +7.32% in the new housing sector).

The most popular cities to buy Spanish homes in the third quarter of 2020 were Madrid, Barcelona, Alicante, Malaga and Valencia. With the gradual opening of the borders, foreign investors have returned to the local market. There were about 14,000 purchases made by foreigners (12.39% of the total number) in the 3rd quarter. The most frequent buyers were British, French, Belgians, Germans and Moroccans.

The global pandemic, self-isolation and quarantine measures that invaded our lives in 2020 have significantly impacted people's real estate preferences. Researchers at Línea Directa Aseguradora report that about 7% of Spaniards changed their residence place in April and May, when self-isolation was declared. According to surveys, the main reasons for the change of residence in 2020 was the desire to increase the area of housing, own a garden or a terrace, or even live close to nature, away from large cities.

According to the study, young people more often decide to change their environment. If the family has decided to change, men are more likely to move out, and women – to renovate. Interesting fact: every third Spaniard surveyed in 2020, bought a new desk to work remotely.

How are viruses affecting the real estate sector? Read in our blog

The growing popularity of small towns and housing with open spaces has lowered rent prices in some metropolitan areas and provinces' capitals. Here we mean Barcelona (-9.3%), Madrid (-7.3%), Palma de Mallorca (-6.2%), Málaga (-5.6%), Seville (-5.2%) and some others.

Despite this, in most Spanish cities, rental prices are actively growing, and even reached a historical high in September (€ 11,4/ m² per month). In times of self-isolation and remote work, many Europeans were forced to give up an idea of buying a home in 2020 and opted for rent.

The tourism and entertainment sector in 2020 suffered more than others. There is now a curfew in Spain and mass events are forbidden. That is why the market is flooded with commercial premises for sale.

This is especially true for nightclubs. According to information from Idealista, today at least 200 nightclubs around the country are for sale. Most of the offers are in Andalusia, Catalonia and Madrid. The price ranges from 50,000 to 6 million euros.

Barcelona's authorities have allocated 50 million euros for the installation of solar panels on the facades and roofs in the city. It is mainly for buildings with high energy consumption, such as hospitals and sports centres. The panels will also be installed on some residential buildings.

A total of 166 million euros will be spent on the installation of solar panels in 2021. By doing it, the Barcelona administration plans to increase the generation of artificial energy by 66% to reduce dependence on fossil fuels and reduce the city's carbon footprint.

Experts of the major Spanish bank BBVA made a forecast about the future of the local resale properties. According to analysts, from April to September 2020, the number of sales in the secondary housing sector decreased by 26.1%. Thus, the market "rolled back" to the level of early 2019.

At the same time, experts believe that the full recovery of purchasing activity will happen in the second half of 2021. Meanwhile, analysts at BBVA expect a 1.5% drop in secondary home prices in 2021.

On Mallorca, you have an opportunity to buy a medieval property that is almost 800 years old. The Bunyoli real estate is located on the island of Mallorca in the Sierra de Tramuntana, which was included in the UNESCO World Heritage List in 2011. Over an area of 250 hectares, it comprises four floors with dozens of rooms and a total surface area of 2838m². There are also several outbuildings and a chapel surrounded by a garden.

For centuries, citrus, olive trees and grapes have been growing here. It has been a home of barons and baronesses of the Bunyoli family for most of its history. Its current price is 14 million euros.