Spanish house prices are holding up better than in the UK, Germany and France.

House prices at home influence buying power and confidence when investing abroad. So how have Spanish house prices performed relatively to the three biggest foreign markets for property in Spain: England, Germany and France?

The chart above shows how the average price of residential property has changed over a decade (the base is the average price in 2015). Although Germany saw a spike in prices in the period leading up to Putin’s invasion of Ukraine, German house prices have fallen sharply since then, and now Spain is the best performer on this metric. Spanish house prices are up 53 pc compared to 44 pc in Germany, 40 pc in England, and 26 pc in France. 

The next chart shows the year-on-year percentage change in the average price of housing in each market up to Q1 2024, which is the latest data available from Eurostat- the European statistics office. Spanish house prices increased an annualised 6 pc in Q1, compared to  a -1 pc decline in the UK, -5 pc in France, and -6 pc in Germany.

Will the chart look the same a decade hence? Almost certainly not. But for now, property in Spain looks like a safer investment than England, Germany or France, where most foreign buyers of Spanish property originate from. 

The relative performance of house prices in Spain and back home can be a headwind or a tailwind for foreign buyers, depending on circumstances. At present it seems that falling prices back home in England, Germany and France coupled with rising prices in Spain are acting as a headwind (amongst other headwinds and tailwinds) with the number of buyers from the UK, Germany and France all declining this year. Demand rose from Poland and the Netherlands, where house prices are also rising.

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