The Spanish coast is leaving more than one with their mouths open and not only because of the 621 blue flags that will wave this year and that recognize the good quality of its beaches. The price of a holiday home near the shore is often higher than that of a flat in any big city. And renting an apartment for a week this July or August, also on the beachfront, has risen by 9.7%, exceeding 1,000 euros per week on average.
In general, prices have not stopped —for the moment, because a slowdown is foreseeable due to the rise in rates— the appetite to buy a house on the Spanish coast, where the demand for second homes has been very strong after the break due to the pandemic and especially since Easter. The transactions made by foreigners have given the necessary oxygen to the weak Spanish coast. Nationals have also set their sights on this market, in which everything from studios to luxury villas are bought and sold. “The nationals that most demand holiday homes are the traditional ones: people from Madrid, Andalusia and Catalans. It is a profile with good financial capacity and over 40 years of age”, explains Ernesto Ferrer-Bonsoms, Director of Real Estate at Intrum Spain and Director of Business at Solvia.
Some buyers are looking for a house that they can enjoy for a few weeks of the year, but above all that they can rent the rest of the time for a good return. Others buy to reside after the rise of teleworking, already consolidated on the coast. “We are witnessing a boom in the purchase of coastal homes for own use; the possibility of teleworking has turned these residences into a second home that can be enjoyed not only on vacations or weekends”, says Ferrer-Bonsoms.
According to searches carried out on the Fotocasa portal, Torre del Mar (Málaga), Matalascañas (Huelva) and San Juan (Alicante) are the most popular beaches for buying a home. For its part, Solvia has detected an increase in demand in coastal provinces such as Gipuzkoa, Bizkaia, Barcelona, Tenerife, Gran Canaria, Malaga and Granada.
The reactivation of demand contrasts with the lack of supply, especially of new construction, which has caused a rise in prices that, in some areas, they describe as unprecedented. “Prices had never risen so much, not even in the years of the bubble, in the south of Tenerife, in the Los Cristianos area, in Playa de las Américas and in La Caleta”, says Araceli Ripoll, real estate agent of the Colegio de Santa Cruz de Tenerife and the real estate company Ocean Properties.
According to the appraiser Tinsa, the price of housing on the Mediterranean coast rose in May —the latest data available— by 6.8% year-on-year. In the islands it was 4.7%.
The push of foreigners, previously stopped by travel restrictions, is key to understanding this new agitation on the Spanish coast. In the first quarter of the year, the weight of purchases by foreigners was 13.17%, returning to levels above 13% that have characterized foreign demand in the years prior to the health crisis, according to the College of Registrars. The provinces with the greatest weight of international acquisitions were Alicante (40.72%), the Balearic Islands (35.37%), Malaga (33.70%), Tenerife (32.15%), Girona (27.88%), Gran Canaria (21.36%), Murcia (19.35%), Almería (18.30%), Tarragona (14.25%) and Castellón (11.86%). The usual – British, German and French – are now joined by buyers from Eastern Europe, who are looking for a home to invest or to live in the future for fear that Russia will extend its invasion beyond Ukraine.
The Canary Islands is one of the destinations they are betting on. “In the south of Tenerife there are a lot of citizens from Romania, Poland, Lithuania or Latvia with a certain purchasing power who are looking for apartments to rent, as an investment,” says Ripoll. Prices range from 220,000 euros for a bedroom without sea views to 700,000 euros for two bedrooms with views, he adds. And, while some buy, others sell. Ripoll has detected a rise in the number of English people who are leaving their homes. “Many are older and the heirs prefer to sell. In addition, there are the difficulties to travel that Brexit has caused.
The strong increase in demand is also being noted in the Balearic Islands. Nationals arrive, but above all foreigners: “In Ibiza the Dutch are standing out, in Menorca the French and in Mallorca the Germans,” says Natalia Bueno, president of the College of Real Estate Agents of the Balearic Islands. “A third of all purchases on these islands are made by investors, who seek profitability through rental. His interest is focused on homes of 180,000 or 200,000 euros, with a return of 4%. The consequence is that this type of cheap product is running out,” says Bueno.
Nationals looking for a second residence for their own use in the Balearic Islands buy in the range of 300,000 to 400,000 euros. Prices have grown between 10% and 15% in the last year, especially in Menorca, where “they were lower. They did not reach 2,000 euros per square meter and now they are exceeded”, says Bueno.
The coast of Alicante is a magnet for both Spaniards and foreigners, and prices there are more affordable than on the islands. “All nationalities buy (English, Belgian, Dutch, Spanish…), and in all municipalities (Torrevieja, Orihuela, El Campello, Benidorm, Calpe…). The Spaniards opt for San Juan beach”, says Marifé Esteso, president of the Association of Real Estate Agents of Alicante. Prices are between 150,000 euros in the towns in the south of the province of Alicante (Torrevieja or Guardamar del Segura) and 300,000 euros or more in the northern beaches (in Altea, for example).
On the Costa Brava, the populations have maintained a very important volume of transmissions, well above others in the interior that are larger by number of inhabitants. “Undoubtedly it is due to the influence of the second home market that has remained very active, since they are buyers with purchasing power,” says Joan Company, president of the Association of Real Estate Agents of Girona. The greatest demand is concentrated in Blanes, Roses, Lloret de Mar or L’Escala. On the Girona coast, purchases by foreigners have always had a significant impact. “Currently it is at pre-pandemic levels; the foreign buyer represents 24% of the total sales in the province and the French buyer is the first foreign buyer”, says Company. In the coastal towns, during the first quarter of 2022 the prices of 2019 have recovered after the brief drop in prices in 2020. Thus, if in 2019 the average price was over 2,500 euros per square meter, this year stands at 2,488 euros.
To buy very cheaply, “the coastal provinces with the lowest prices are Huelva, Granada, Almería, Murcia, Castellón or Lugo, with an average price between 1,000 and 1,300 euros per square meter,” says Ferrer-Bonsoms.
1,000 euros per week
Just released the summer, there are many laggards who are still looking for an apartment for these holidays. They will find that the national average stands at 1,016 euros per week, 90 euros more than the previous year, with an increase of 9.7%, according to data from the report by Tecnitasa. Although the market is very heterogeneous.
The Catalan coast is the one that increases its prices the most, according to the appraiser. In Tarragona, which has become 15.2% more expensive, Salou stands out, where you have to pay 1,370 euros per week for an apartment of 60 square meters. It is followed by Girona, with increases of 12.6%, where 50-meter apartments can be booked for 1,500 euros in Cadaqués or 1,200 in the center of Begur. The cheapest can be found in Blanes, in Los Pinos, for 700 euros per week, or in Palamós, for 850 euros. In Barcelona, Sitges stands out, where 80 meters are rented for 1,600 euros. It’s not all scares. Renting in Cantabria or Murcia can be the same or even a little cheaper than the summer of 2021. In the center of San Vicente de la Barquera there are apartments for 595 euros or 735 on the Comillas beach.
According to José María Basañez, president of Tecnitasa, “the rises produced in recent years mean that families with tighter resources must, when it comes to summer, reduce the number of vacation days or look for smaller apartments or apartments further away from the beach”. And he adds: “However, the most privileged locations, such as Illa a Toxa, Puerto Banús, Cadaqués or Ibiza, to give a few examples, with very high prices, continue to have a high demand, with a practically full capacity”.