The asking price index published by the Spanish property portal Idealista.com reveals stark differences in vendor pricing power in different parts of Spain.
Are property prices going up or down in Spain? Is negotiating power shifting from buyers to vendors? It all depends on location and market segments, with big differences to be found between them.
Average asking prices nationwide fell 2.7% in the third quarter to 1,533 €/m2, reveal Idealista, but prices rose in nine of Spain’s 17 autonomous regions, and in 24 provinces, with Barcelona in the lead amongst big cities, up 3.8%.
Compared to crisis lows, house prices in Barcelona have risen 24% since they bottomed out in 2013. In Valencia city prices are up 8.1%, and by 7.7% in Madrid. In a recent analysis I did of asking prices published by Idealista I found that prices in Ibiza have risen most of all, and are now significantly higher than their boom-time peak (chart below).
So we have a situation where house prices are in full recovery mode in Madrid, Barcelona, and some other places on the Spanish coast, but continuing to fall in many cities and provinces in the interior. Generally speaking, markets are recovering where foreigners buy, but still languishing in the doldrums in markets that get no support from foreign demand.
“The data from our report reflect more than ever the two speeds at which the sector is moving,” comments Fernando Encinar, head of research at Idealista. “Half of the markets are seeing price increases, whilst the other half are falling, a tension that means that the national price is practically stagnant.”
Encinar warns that the political impasse in Madrid is starting to have a negative impact on the market. “The uncertainty generated by the elections has put a brake on home sales as reflected in the latest figures from the INE [National Institute of Statistics]”