Country property in Spain is in high demand as buyers seek refuge from the coronavirus pandemic and surging inflation, but there is a shortage of Spanish rural land for sale in the most popular areas.
Spanish country property sales were close to all-time highs in the first quarter of the year, according to the latest data from the National Institute of Statistics (INE). There were 43,650 rural property sales in Q1, up 11% on the same period last year and 8.4% higher than 2019. It was the highest level of quarterly sales since the boom year of 2007. The chart below shows quarterly property sales since 2007.
As you can see from the next chart, country property sales have been steadily climbing since they bottomed out in 2011 with just 103,609 rural land sales that year, down from a peak of 192,302 in 2007, a decline of 46%. By last year rural property sales were up 53% compared to the trough of 2011. However, country property sales have really taken off in the last few quarters in the wake of the pandemic, with growth near or above double-digits in most quarters.
Unsurprisingly, most rural property sales in Spain are located in the three biggest regions of Castile & Leon, Andalusia, and Castilla – La Mancha. Along with the Valencian region they make up 58% of all rural property sales in Spain.
If you look at the quarterly change in sales (year-on-year) in a selection of regions and provinces of most interest to foreign investors you see the biggest growth in sales in Q1 came from the Catalan provinces of Barcelona (+40.5%) and Tarragona (+32.1%). This reflects a pandemic-related displacement of demand alway from urban areas to rural areas with good access to city centres and transport hubs.
Industry insiders report that rural property sales are being driven by lifestyle changes in the light of the pandemic, and some also mention a growing interest in rural real-estate as an inflation-proof asset offering a self-sufficient lifestyle.
“Since the pandemic there has been an increase in demand for country properties,” explains Kelly Summerell, head of Mediterranean Homes, an estate agency specialising in Andalucian country properties in the Guadalhorce Valley not far from Malaga city and airport. “Many people want to escape the hustle and bustle and move further inland and enjoy a country life. Many are also looking for a ‘finca’ with some land to grow their veggies and have fruit trees.”
Following in Christ Stewart’s footsteps
Rural property is a niche for the foreign market as most buyers head for the coast and islands but it’s easy to imagine international demand for Spanish country property continuing to rise in the years to come. Call it following in the footsteps of Chris Stewart, the “hapless optimist” who bought an organic farm in the Alpujarras mountains of Andalusia many decades ago and increased his claim to fame from ‘the unheard-of original drummer of Genesis’ to ‘the quite famous author of Driving Over Lemons.’
Spain has a large, attractive interior where land prices are relatively low and the population is declining, meaning the Spanish government will need to attract new residents to breathe life back into the interior and many of Spain’s abandoned villages. Roads and transport links are good, internet connections are good in many places, safety is not a problem, and the climate appeals to many. Resourceful people will find ways to earn income from the land, but the big problem today is the lack of country properties for sale, at least in rural hotspots favoured by foreign buyers looking for attractive countryside not too far from a city and transport hub with lots of options for exploiting the land like farming, agro-tourism, environmental projects, or self-sufficiency.
“The problem most agents are encountering at the moment is the lack of stock, there really aren’t that many properties left and not many new properties are going on the market,” explains Kelly, whose main buyers today come from the Netherlands, Denmark, Belgium, and the UK. “This has actually increased the prices of properties a bit, as the demand is so high and there is little stock available. We have a long list of clients ready to purchase in the area, but there just isn’t much on the market at the moment.”