Last year, the price of residential real estate rose by an average of 6.6%. The analytics predict that in 2019 growth rates will decline and will be about 3%. In the coming years, the figure may vary from 2% to 3%. It is noted that the increase in the cost of apartments will be higher in cities where there is an increased demand for such property.

Experts say the general slowdown is mainly due to the expectation of a moderate economic recovery of the Spanish economy as a whole. Prices in the most dynamic regions, such as Madrid or Barcelona, ​​will continue to grow steadily. In regions with less developed economies and less demand, the price increase will not be significant. It can be said that the housing market in Spain is developing at two speeds: fast in the economically developed resort regions and with low growth in areas with low demand for housing.

What is the Situation Actually?

The state of the market associated with mortgage loans is today in a better position than when a bubble appeared at the end of the last decade.

• The number of mortgages in relation to the total number of sold apartments and houses has decreased.
• The share of new mortgage loans at fixed interest rates has increased, which adds to the industry stability. Official figures show that the share of fixed mortgage accounts for about 40% of new operations, which means that it is in the region of a record high level of stability.
• Banks continue to analyze each financial transaction and require proof of material solvency to issue a mortgage.
• The outstanding debt on mortgage loans continues to fall (from the maximum level of 2010, it fell by € 130,000 million).
• The ratio of the number of purchases and sales is stabilized, which reduces efforts to acquire the necessary housing.

However, there are imbalances in the Spanish property market that should be addressed.

• The increase in the value of the real estate, in general, entails an increase in the total volume of loans issued.
• The lag in wage growth and a decrease in household savings increase the number of years needed to repay loans and to buy housing.
• In general, total debt can grow, which will adversely affect both the issuance of new mortgage loans and the issuance of securities and bonds on new construction.

Specialists say that the modern housing market in Spain, despite some risks, is more prepared than ten years ago, in the event of a hypothetical collision with a crisis in the future.