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Date Published: 29/04/2024

How much do foreigners pay for property in Spain?

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Foreign buyers paid record prices for homes in Spain in 2023

How much do foreigners pay for property in Spain?

Non-residents in Spain paid an average of 2,715 euros per square metre for properties in the second half of 2023, a 6.1% year-on-year increase and a new record high. This surge in prices contributed to the overall rise in average costs paid by foreigners (both residents and non-residents) to 2,175 euros/m², representing a return to 2008 levels.

The total average price paid for homes in Spain, inclusive of both locals and non-nationals, reached 1,712 euros/square metre, reflecting a 2.1% annual growth.

Buyers from Sweden paid the highest average prices (3,077 euros/m²), trailed closely by those from the United States (3,006 euros), Germany (2,848 euros) and Switzerland (2,828 euros). Investors hailing from Norway, Poland, Russia, the Netherlands, France and Italy similarly surpassed the general average price paid by all foreigners.

Meanwhile, purchasers from Morocco, Romania and Bulgaria paid the least.

Interestingly, while prices tended to climb in an almost general way, the number of overall real estate transactions in Spain actually dipped last year. Notary statistics put the number of property purchases by foreigners in Spain in the second half of 2023 at 63,183, which is a 10% drop and represents the lowest number since the first half of 2021.

Despite these trends, certain parts of Spain saw increased foreign property purchases in 2023. These include Asturias (11.5%), Cantabria (4.0%), La Rioja (3.4%), Murcia (1.8%) and Castile-La Mancha (1.1%). On the other hand, twelve autonomous communities witnessed negative changes, with the Canary Islands experiencing the greatest decline (-21%), followed closely by the Balearic Islands (-20.7%), Andalucia (-12.4%), Catalonia (-11%) and Navarra (-10%).

Spain's Valencian Community leads the way in foreign investment, accounting for nearly 30% of total transactions. Over the past few months, the Levante region has dominated the real estate scene, attracting both local and foreign clientele alike due to affordability, strong returns, convenient transportation options and the Mediterranean lifestyle.

Esther Abad, territorial coordinator for Levante and Catalonia at Foro Consultores, credits the substantial presence of foreign buyers in this community, particularly in Alicante, as the key factor fuelling the popularity of the region.

While Britons comprise the majority of foreign investors in Spain, accounting for 9.7% of total transactions, Moroccans follow close behind at 7.14%. Interestingly, Ukrainian and Russian buyers grew steadily last year, increasing their sales by 9% and 4.7% respectively.

Colombian buyers also reached a milestone, closing 932 transactions - an all-time high primarily driven by the luxury market catering to wealthy individuals seeking stability amidst political uncertainty in their native Colombia.

Delving deeper into the different regions of Spain, it seems that the French took the lead in purchasing shares ahead of the Germans and British within the two Castilian regions, Extremadura, Aragon, Catalonia, Navarra and Cantabria. At the same time, the British emerged as the frontrunners among non-resident foreign buyers in the Valencian Community, Murcia and Andalucia.

When examining resident foreign buyer behaviour across various regions, a distinct pattern surfaced. With a few exceptions, notably Galicia, Valencia and the Canary and Balearic Islands, Moroccan and Romanian nationals constituted the bulk of foreign buyers. Within Galicia, Portugal held the lion's share of purchases, while the British, German and Italian demographics showed stronger representation in Valencia and the archipelagos.

Also of interest: How will the Spanish real estate market behave this summer?

Image: Freepik

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