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Date Published: 02/12/2021

ARCHIVED - Alicante surpasses Malaga as top destination for foreign homebuyers

ARCHIVED ARTICLE

The Costa Blanca real estate market for second homebuyers has returned to pre-pandemic levels

<span style='color:#780948'>ARCHIVED</span> - Alicante surpasses Malaga as top destination for foreign homebuyers

Alicante province is once again the preferred destination amongst foreign buyers purchasing a second home in Spain, according to the latest annual report by the international consultancy firm Colliers, which specialises in the hotel and real estate sector.

Data shows that the foreign market has almost returned to normal, reaching pre-pandemic levels in 2020, and demonstrates that "Alicante continues to be the province most chosen by foreigners looking for a second property", ahead of Málaga.

Some 17.6% of home purchases registered in Alicante were made by non-Spanish buyers, followed by Málaga with a 11.4% share, Barcelona (8.7%), Madrid (7.7%), the Canary Islands (7.6%), Valencia (6.3%) and the Balearic Islands (6.2%).

In terms of total sales, the province remains at the top of the market for both new and second-hand properties. The Colliers report shows that although Madrid continues to lead the demand in the new-build market, with a 21% share, followed by Málaga (8.9%), which this year overtook Barcelona (8.3%), Alicante is in fourth position with 7.2% of all transactions, followed by Valencia with 6.1%.

In the second-hand market alone, Madrid accounts for 12.9% of all transactions, followed by Barcelona (10.7%), Alicante (6.4%), Valencia (6.3%) and Malaga (4.8%).

Overall, demand for housing in 2021 started very strongly, according to the real estate experts, and the first half of the year was reportedly the best historically since 2008.

In fact, the number of housing transactions during this period was 63.7% higher than in 2020 and 10.67% higher than in the first half of 2019.

"The performance has been very good both in the number of new housing transactions, up 44.9% compared to 2020 and up 23.9% on 2019, and in the number of used housing transactions, there was an increase of 66.2% and 9.3% respectively," reads the report.

And similarly, there has been a growth in sales prices this year, particularly during the second quarter of the year.

"The strong demand that occurred in the second half of 2020 has continued with somewhat more intensity in the first half of 2021. According to our predictive models, we estimate an additional price increase of 1% to 2% by the end of 2021, both in new and used housing," said Antonio de la Fuente, Managing Director of Corporate Finance at Colliers.

For the year 2022, "some price stability is likely", although there could be increases of between 5% and 10% for new rather than used housing in some areas where demand is growing strongly, including Alicante.

"The population growth of 900,000 inhabitants over the last four years will continue to put upward pressure on housing demand, especially in markets such as Madrid and Barcelona, but also in Alicante, Málaga, the Balearic Islands, Valencia, and Murcia, also driven by foreign demand," added the real estate firm.

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