Spanish house prices continued their recovery rise through 2018 following almost a decade of decline in property values.
Average Spanish house prices rose year-on-year in the third quarter of 2018 by 2.39 per cent, following year-on-year rises of 4.01 per cent and 2.37 per cent in quarters one and two respectively.
These rises in Spanish house prices built on similar rises the previous year, where values rose year-on-year in every quarter. 3.32 per cent in quarter four 2017, 1.42 per cent in quarter three, 0.85 per cent in quarter two and 0.41 per cent in quarter one.
Quarter-on-quarter, Spanish house prices increased 0.33 per cent in quarter three 2018.
Demand also rose strongly during the first nine months of 2018, surging by 11 per cent to 395,534 units according to the National Statistics Institute. Existing home sales increased 10.9 per cent while new home sales rose by 11.5 per cent.
The rise in property transactions was mainly driven by overseas property investors buying homes on the coast and in cities like Barcelona and on the Costa del Sol, one of the country’s most popular areas with overseas purchasers.
Most overseas property investors are British, French, Germans, Belgians, Italians or Swedes.
Rental yields in the major Spanish cities have also risen to reach moderately good levels, encouraging overseas property investors to buy.
Rental yields in Barcelona and Madrid have now reached a decent level of 4.40 per cent to 5.15 per cent.
Further encouraging news helping to drive Spanish house prices is that quarter three showed the Spanish economy growing by 2.5 per cent from a year earlier, unchanged from the previous quarter’s annual growth.
After expanding by 3 per cent in 2017, the economy is projected to have grown by 2.6 per cent in 2018 when full figures are available, and by another 2.2 per cent in 2019, according to the European Commission.