The COVID-19 pandemic has changed world trade in many ways and the Spanish real estate market is no exception. With lesser but still palpable uncertainty, many of our clients ask us regularly if the Spanish real estate market is still active and whether or not people are still buying and selling properties in Valencia, Costa Blanca or Murcia. Well, we now have an answer to all those questions.
The British market has played a leading role in Spain for many years. Since 2015, the British have been responsible for 25% of real estate transactions in Spain, but this percentage has now dropped to slightly below 10% (9.89%) of the total number of transactions carried out by foreigners in Spain and also below the 10.42% share of the German market, which has taken off in Spain since the beginning of 2021.
During the third quarter of 2021, German purchases not only surpassed the British, but also all the rest of nationalities. The ranking of foreign nations is currently as follows: French (a market share of 7.82% with 1,262 transactions), Morocco (6.54% and 1,055 purchases), Belgium (5.62% and 906 purchases) and Romania (5.30% and 855 transactions).
While it is true that many British people continue to carry out real estate transactions in Spain, there has been a sharp drop since all British citizens were called to the Brexit referendum and this has sparked a significant increase in real estate transactions undertaken by German citizens, who are returning to non-traditional areas such as the Costa Blanca or Costa del Sol (90% of German transactions were concentrated in the Balearic and Canary Islands in the past).
It is a well known fact that the islands and the Mediterranean coast are still the most attractive areas for foreigners in Spain. The provinces with the highest proportion of home purchases by foreigners during the third quarter were the Balearic Isles (34.34%), Alicante (33.48%), Santa Cruz de Tenerife (27.57%), Malaga (26.53 %), Girona (20.51%), Las Palmas (19.59%), Murcia (17.44%), Almería (12.57%), Tarragona (11.66%) and Castellón (10.24% ).
The fact that the data from the Spanish Land Registry shows growth in housing sales to foreigners means that, after many months of uncertainty, the Spanish real estate market is starting to recover to the levels observed prior to the pandemic.
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