The SPI House Price Index Tracker plots the six most-watched Spanish house price indices on one chart (above).
The six indices are updated and reported at different times, as often as not sending contradictory messages to the public about the direction of the market.
Some of them are published monthly, some quarterly, and some lag the market by several months when they are published. Some are based on valuations, some on asking prices, and some on sales prices that are never made public. They are all mixed up and reported in the press as ‘house prices’ with little context or nuance.
Personally, I don’t find any of them particularly useful for understanding market prices, but taken together they do give us a sense of the overall direction of the price trend. If you take a step back and look at the chart, you get the picture. Whichever index you look at, the trend was already down in 2019, and the decline turned steeper in 2020, for reasons we can all guess – the Covid-19 pandemic.
Bearing in mind their limitations, the following residential property price indices were updated in the fourth quarter of 2020 (all figures show latest year-on-year percentage change):
- The Spanish Government (Ministry of Transport, Mobility, and the Urban Agenda (MITMA) based on officially-recognised valuations -1.1% in Q3
- The National Institute of Statistics (INE) based on data from the Land Registry +1.7% in Q3
- The Spanish Land Registrars’ Association using their ‘repeat sale’ methodology +0.8% in Q3
- The Association of Spanish Notaries based on sales witnessed by its members -4.7% in October, up from -7% in September
- The Tinsa index based on property valuations carried out by the company -2.2% in November
- The Idealista.com (property portal) resale asking price index +0.9% in December
The more recent indices from the notaries, Tinsa, and Idealista, suggest that prices were pulled down by the pandemic in the first half of the year, but stabilised or started recovering in the second half. It’s still too early to see how the pandemic will affect house prices. It is quite possible that prices will lurch down again in 2021, as the economic crisis brought about by the health crisis takes its toll.