A look at the real estate market in 2022

Analysts expect average prices to rise further in 2022. / ON

Buoyant. Analysts expect house prices in the province to continue to rise this year

Malaga ended last year as the most expensive province in Andalusia to buy a property, with a revaluation that until November was more than two percent, the average increase in property prices in Spain in 2021. Analysts expect an even bigger increase in 2022, and I think it could reach four or five percent.

Since the beginning of the Covid pandemic, the price of real estate in Malaga has increased by 5%. In November, the year-over-year increase was 2.13%, according to the pisos.com monthly sales price report. The rise in resale property prices in Malaga has been lower than in some others in Andalusia, such as Huelva (4.51%) and Granada (2.69%), but even so the average price remains one of the higher, at 2,203 euros per square meter.

This is much more expensive than in Cadiz (1,483 euros per square meter) and Seville (1,401 euros), which are the second and third most expensive provinces to buy a house.

In the city of Malaga, however, the revaluation of properties has been higher.

Compared to the same month in 2020, the average house price in November saw a year-on-year increase of 5.3% (the highest of all provincial capitals) to an average price of 2,460 euros per square meter, almost reaching the level of Cadiz (2,474 euros) as the most exclusive at the time.

Growing demand

The revaluation of housing prices was even higher in some other municipalities in the province of Malaga, such as Alhaurín de la Torre (up 8.44%), Ronda (8.37%), Manilva (8.36%) , Rincón de la Victoria (7.46%) and Nerja (7.32%).

Factors such as the end of mobility restrictions that have crippled many operations in 2020, increased household savings and an interest in real estate as an investment so as not to lose purchasing power due to inflation are some of the reasons, according to Ferran Font, the research director of pisos.com, that property prices have increased in 2021 and he expects this to continue in 2022. All this led to an increase in demand last year, which resulted in properties being re-evaluated.

“We should not be alarmed by the rise in prices, because it is within the limits of what was expected given the recovery in demand.

“This has been supported by savings built up to avoid inflation through property purchases and avoid more volatile markets,” he said, adding that “financing is getting cheaper” as another of the factors that influence the increase in interest in buying a property.

Font said that, compared to 2020 data, it looks like the number of real estate sales increased by around 31% last year.

Between January and October, according to figures from the National Institute of Statistics (INE), in the province of Malaga the number of transactions increased by 39.38% compared to the same period in 2020.

Bigger rises ahead

In 2022, analysts at pisos.com predict that prices will continue to rise and Ferran Font thinks the increase will be around four or five percent. However, he does not expect drastic revaluations, as “both supply and demand are looking for stability”, he explained.

In addition to the factors mentioned above, an expected increase in the prices of new homes due to rising construction costs due to the lack of raw materials and the shortage of skilled labor could temporarily transfer this tension from prices at resale properties.