House Prices in Spain Increased 4.2% in 2023

House prices in Spain seem almost immune to rising interest rates and their impact on mortgages. There is a slight drop but they maintain their resilience. This is indicated by the Housing Price Index (IPV), published by the National Institute of Statistics (INE).

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House prices make renting more profitable for landlords than having bills or investment funds

In the fourth quarter of 2023 it fell three tenths, but is still positive and stood at 4.2%. However, there are clear differences by type of housing, because newly built housing leaves the index at 7.5% (it fell 3.5 points for the year as a whole); and on the other hand, the variation in second-hand housing stood at 3.6%, four tenths higher.

As a comparison, the rise in new housing is the highest in price since the real estate bubble, because in 2007 its price increase reached 11.9% and used housing has accumulated ten consecutive years of increases.

If we focus only on the final stretch of the year, the INE assures that new house prices decreased by 1.4% between the third and fourth quarters, while second-hand housing prices fell by 1%.

The resistance of housing, despite the increases in the Euribor, makes it a much more interesting option for investors who bet on it as another asset and not as a right. In fact, for landlords it is more profitable to have an apartment for rent than to bet on investment funds.

The biggest increases in house prices were registered in Andalusia and Navarra

The INE also breaks down how house prices have evolved in the last year in the different territories.

It indicates that the autonomous communities where the greatest house prices increases were recorded were Andalusia (5.3%), the Foral Community of Navarra (4.7%), the Canary Islands and the Community of Madrid (4.5% in these last two cases).

On the other hand, the smallest increases were recorded in Castilla-La Mancha (2.1%), Extremadura (2.2%) and Galicia (3.4%).

In Catalonia, the rebound was 3.5%, below the average. Euskadi is also behind, where prices increased by 3.9%. On the other hand, in the Balearic Islands, the increase was above the state average and stood at 4.4%.

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(Featured image by Roberto Blacio via Unsplash)

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First published in elDiario.es. A third-party contributor translated and adapted the articles from the originals. In case of discrepancy, the originals will prevail.

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