Foreign demand for property in Spain grew by double digits in the first half of the year, and the British are still the dominant force in their favourite regions, despite a significant decline in British demand post-Brexit, reveals a report just published by the Association of Spanish Notaries.
Spanish notaries witnessed 50,087 home sales involving foreign buyer in first six months of 2017, up 13.4% on the same period the year before, and the highest number since notaries started publishing sales by nationality in 2007.
Foreign buyers were 19.4% of the Spanish housing market in the first half of the year. In their report the notaries point out that foreign demand has been touching “20% for five consecutive years.” The only reason why the foreign market share is not increasing more is because local demand is now increasing faster.
Of the 50,087 homes bought by foreigners in the first half, 53% were bought by expats living in Spain (26,546 properties), and 46% by non-residents, who bought 23,540 homes and investments, up 22% on the same period last year.
Foreign demand was up in all regions, though percentage gains were highest in regions that attract the smallest number of foreign buyers, led by Castille and Leon (+39%), Navarre (44%) and La Rioja (75%). Gains were smaller in regions with big numbers of foreign buyers, for example the Balearics (+5.3%), Andalusia (+5.4%), and Murcia (+5.7%).
Foreign buyers paid 2.9% more per m2 on average than the same time last year, with second-home buyers spending 4.5% more (1,941 €/m2), and residents 2.9% more (1,405 €/m2).
Foreign demand for Spanish property by nationality
Overall, the British are still number one with 13.9% of the foreign market, followed by the French (8.8%), Germans (8.2%), Italians (7.7%), and Romanians (6.9%).
All markets increased, with the exception of Denmark, Sweden, and the UK, which was down 16.4%.
Foreign demand by region
The regions where foreign buyers had the greatest market share were the Canaries (42.3%), Balearics (37.7%), Valencian Community (35.5%), Murcia (26.9%), and Andalusia (19.4%).
The figure above shows two maps provided by the notaries. The map on the left shows the two biggest foreign markets in each region for non-residents, and the map on the right shows expat demand (foreigners resident in Spain).
When it comes to non-resident demand for second homes in Spain, the British are still the biggest or second biggest in seven regions, including Andalusia, Murcia, the Valencian Region, the Balearics, and the Canary Islands. They are also buy the most second homes in Galicia and Asturias, where they are 20% or more of the market. So Brexit has diminished the British appetite for property in Spain, but not enough to knock it off the top spot.
The other big group of second home buyers are the French, who were also number one or two in seven regions, obviously three of the four regions that border France (Catalonia, Navarre, and the Basque Country), and the wine-growing region of La Rioja close by, but also, surprisingly, Castille La Mancha, Castille & Leon, and Extremadura. It seems the French have developed a taste for holiday-homes in l’Espagne profonde, rather like the British in France.
It’s also interesting to note that second-home buyers from the USA were number two behind the French in Extremadura and Castille & Leon. It’s worth keeping an eye on how US demand develops over the next few periods.
Looking at expat demand, meaning foreigners resident in Spain, the Brits are still the biggest group in their traditional favourite stomping grounds of Andalusia, Murcia, and the Valencian Region, and number two in the islands. In most other regions the big groups are the Romanians, Moroccans, and Chinese, who are number one or two in most of them.