The price of housing in Spain could fall by 5% in 2021

Spain propertySpain housing market performace during Covid-19 crisis

Continuing the negative trend already observed in 2020, when this type of asset depreciated by 3.7%, housing prices could fall 5% in 2021, according to a survey of sector experts organized by the newspaper Expansion.

On the other hand, a certain recovery in the volume of sales and purchases is expected this year, with up to 480,000 transactions compared to 450,000 last year; in 2019, almost 570,000 property sales and purchases were recorded. Despite an expected economic upturn, the acceleration in price falls in 2021 is attributed, amongst other factors, to the existing gap between the actual performance of the market and records of transactions.

Accordng to Anlaysts atr Intermoney, housing prices are inevitably going to suffer the onslaught of the pandemic. However, a relaxation in prices and rent increases due to economic cooling was already evident before that.

“And there are additional factors which will contribute to the decline in prices, such as the collapse of tourist rents in the big cities. This would force many owners to put their apartments up for sale. Finally, new government regulations do not help to make the sector more attractive either.That said, it is not all bad news. This is because the large amount of household savings could be transferred, at least in part, to real estate investment sooner or later.

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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.