Bankinter | Housing Transactions fell -10% in December (year-on-year) vs +11% in the previous two months. This is the first fall since February 2021. Thus, 2022 closed with 650k transactions (+15% vs 2021). On the other hand, according to the Land Registry, Housing Prices fell -0.4% on average in Spain in 4Q 2022 (q/q) vs +0.1% previously. Those of used housing fell by -1.1%, while those of new housing still increased by 2.5%. 2022 closed with a year-on-year increase of +6.7%.
Analysis: First signs of weakness in the Spanish housing market. Both transactions and prices slackened in the final stretch of the year. This is the first quarter that prices have fallen in Spain since 3Q 2020, according to COVID, and to find another quarter-on-quarter fall we have to go back to 2014. This is due to: (i) Higher cost of mortgage financing, in an environment of rising interest rates; (ii) Lower household savings rate, due to higher prices in basic consumer goods (energy and food); and (iii) Less attractive investment in rental housing, with a yield similar to the Spanish 10-year bond. We maintain our forecasts of a -5% fall in house prices and -18% in Transactions between 2023 and 2024.