Independent and accurate property prices in Spain

Download the latest Spanish House Price Index
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The Kyero.com Spanish House Price Index is free to download.

It's updated and published quarterly to evaluate the advertised prices of 90,000 Spanish properties.

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Spanish House Price Index by Kyero.com
(Reprint permission granted when this line and hyperlink included)

Thanks to Sam at A Place in the Sun we found an error in the latest price index and corrected it.

There was a discrepancy between our latest Spanish house price index and the national average price for Spain here.

Now they’re reconciled (apart from a small rounding error) and I’m happy to report that we all agree that the national average price of property in Spain is €240,000 – Thanks Sam :)

Martin Dell, Kyero.com

After writing about the decline of foreign property transactions, I got my wrists slapped by Luisa at Mirodali Properties.

She quite rightly pointed out that, by combining sales figures for new-build properties and resales, I had (unintentionally) distorted the actual growth rates for each province.

This is because a new-build property essentially gets 'sold' prior to construction but the sale is only recorded after construction. Hence, the growth rates of new-build completions actually reflect buying activity that is two, three or more years old.

Compare this to the sale of a resale property which is notarised within a few months of a buyer saying 'Yes, that's the house I want' and you begin to see the problem.

By combining new-build and resales growth rates, I added apples and oranges and made bananas - my apologies.

Another facet I did mention but perhaps didn't stress enough is that the figures I analysed were for foreign buyers only - not all purchases.

Here's a revised spreadsheet (keeping apples and oranges separate this time).

Luisa was absolutely spot-on - mixing numbers for new-build properties and resales is meaningless. Here's what struck me when comparing the number of resales transactions between Q2 2006 and Q2 2007:

1. Overall, resales transactions dropped by almost 20% from 145,000 to 116,000



2. Andalucia resales fell overall by 13% despite 23% more purchases by foreigners. Spanish resale purchases fell by 17%.



3. Granada province was the jewel in the crown of Andalucia showing an overall 19% increase in resales transactions - a reflection of both Spanish and foreign buying trends.



4. Apart from Granada, every other province in Andalucia recorded an overall decline in resales transactions, despite increased activity in many provinces from foreign buyers. Spanish buyers, who account for approximately 85% of all resale purchases only increased their purchasing in Granada by 14%.



5. The Canary Islands overall saw 16% more resale purchases in Q2 2007 compared to Q2 2006 - largely thanks to 73% more foreign purchases but Spanish purchases increased by 4% too.



6. The Balearic Islands also saw a healthy increase in foreign purchases - up by 18% from 817 to 960.



7. Foreign purchases now account for 15% of all resales transactions. Proportionally, more foreigners are buying in Spain than ever before - favouring the regions of:
   
   Andalucia (up from 9% to 13%)
   The Balearic Islands (up from 20% to 24%)
   The Canary Islands (up from 17% to 26%)
   Valencia (up from 23% to 26%)
   Murcia (up from 23% to 25%).
   
   (Percentages are the proportion of all purchases made by foreigners)



8. Foreign interest declined in many regions - significantly in Calatlunya and Madrid - down by 10% and 25% respectively.

In summary, it seems as though Spanish buying activity is cooling faster than foreign activity. Perhaps this is because the Spanish economy is more reliant on the construction industry than elsewhere in Europe. In essence, as the construction boom has ground to a halt, there are more unemployed construction workers with less spare cash than previously.

Martin Dell, Kyero.com

The latest figures from the Spanish Ministry of Housing contain good and bad news about how many homes were purchased by foreigners during the second quarter of 2007.

Comparing Q2 2006 to Q2 2007 we see the following:

1. Overall number of property transactions fell by 16% from 28,702 to 24,222
2. Andalucia region had a very strong Q2 in 2007 - up by 23% from 3,253 to 4,359. New build completions in Andalucia were up by 60% and resales up by 23%
3. The strongest performer in Andalucia region was Cadiz province with new build completions up 185% from 41 to 117. Sevilla province came a close second with new build growth of 153% from 17 to 43 - seemingly at the expense of resale growth - up just 1%.
4. Malaga and the Costa del Sol was far from disastrous, up 61% overall from 1,402 completions to 2,262 and a strong showing for both new build and resale properties.
5. The islands had a respectable performance. The Balearics improved by 17% overall and the Canaries by 43% - thanks to resale property performing well.
6. Valencia region experienced 7% fewer property completions - down from 7,409 to 6,969. Alicante province experienced poor new build performance, down by 16% from 4,975 to 4,794. Resale completions increased by 6% from 2,715 to 2,878 giving Alicante an overall drop in completions of 4%.
7. Valencia province experienced the reverse split between new-build and resale completions. New build completions increased by 23% and resales decreased by 12% - producing an overall drop in volume of 9% in the province.
8. Normally significant contributors to the number of property transactions, Catalunya region dropped by 39%, Madrid by 57% and Murcia by 24%.

Even though these figures are now almost 9 months old, it's the first time that this data has been made available to the public. It confirms the scope of the downturn in the number of property purchases by foreigners in Spain.

What's surprising is how well the region of Andalucia performed and, in particular, the strong performance of Malaga and the Costa del Sol.

Download the full set of MVIV data

• Original data is freely available to download from the web site of the Ministerio de Vivienda. No changes have been made to the source information other than for clarity of presentation and translation into English.
• New construction is defined as properties less than 2 years old. These figures *might* include property purchased off plan and 'flipped' or resold in the same period and while the property is still technically 'new'
• Resales are defined as any property older than two years - again, this may not strictly correlate to a property having been sold a number of times
• Except where specifically mentioned, all figures exclude sales of subsidised or social housing.
• Sales of urban and rural land are excluded.
• Sales to 'foreigners' are categorised as resident, non-resident and 'other'. For the sake of clarity, only figures for foreign residents in Spain are presented here as they account for the vast majority of cases.
• Actual prices are likely to be unreliable due to the fact that some of the sales price passes from buyer to seller 'under the table'. This amount is never notarised and therefore cannot feature in the MVIV figures.
• As the Spanish government increases their efforts to stamp-out these 'black money' practices, house prices might 'appear' to be increasing when, in fact, a proportion of that increase must be attributed to a larger propeortion of the actual sales value being notarised.