Last year was a record year for German buyers in Spain, with 4,902 homes purchased in 2018, up 3% on the previous year, and more than 100% up on 2013. That said, the growth in German demand last year was by far the lowest of the last five years, and the first time it dropped below double digits, mainly because of an annualised decline in demand in the last two quarters of 2018.
On a quarterly basis, German buyers were involved in 1,178 Spanish home sales registered in the Land Registry in Q4 last year, almost unchanged from the same period a year before, but significantly higher than Q3 2018, when for some reason German demand took an 8% dip.
Despite the low level of growth in 2018, the Germans have now overtake the French as the second biggest group of foreign buyers after the British, representing 9.7% of the foreign market in 2018, compared to 8.8% for France and 15.5% for the UK.
The next chart compares British, French, and German demand since 2013, and illustrates how, whilst the British have kept a commanding lead despite a post-Brexit dip, German buyers have steadily increased in numbers to overtake the French.
Where do the Germans buy property in Spain? Figures from the notaries show they focus heavily on the Balearics (mainly the island of Mallorca). where they are 46% of non-resident buyers from abroad. They are also the biggest group of foreign non-residents buying in the Canaries, accounting for 20% of that market. The are in second place in Castilla y Leon, the Basque Country, and Catalonia, so perhaps they are not as focuses on the islands as they once were.
Hans Lenz, a Managing Director of Engel & Völkers in Mallorca and expert in the German market, explains how demand changed in 2018. “The eagerness to purchase and feeling that buyers were in a rush in 2017 gave way to a more thoughtful and careful attitude amongst German buyers in 2018, but it was still a great year for the German market in Mallorca, as the island becomes ever more attractive to local and foreign buyers.”