The Province of Alicante has once again become the preferred locationfor foreign buyers looking to purchase a second residence in Spain. This is confirmed by the latest annual report prepared by the international consulting firm ColliersColliers , specializing in the hotel and real estate sector. After the pandemic stopped in 2020, the external market has almost returned to normal during this year, reaching pre-pandemic figures that reinforce Costa Blanca’s leadership.
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The report emphasizes that ” Alicante continues to be the province most chosen by foreigners. 17.6% of home purchases made by foreigners were registered in this city.” Malaga with a share of 11.4%was the second province preferred by foreign buyers, followed by Barcelona (8.7%), Madrid (7.7%), the Canary Islands with two provinces (7.6%), Valencia (6.3%) and the Balearic Islands (6.2%).
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In terms of total sales, the province remains at the top of the market for both new and secondary housing. Thus, the Colliers report shows that while Madrid continues to lead the demand in the new housing market (with a 21% share), followed by Málaga (8.9%), which displaced Barcelona (8.3%) in 2021, Alicante is in fourth position.with 7.2% of transactions, followed by Valencia with 6.1%.
In the secondary housing market, the province of Madrid also records the highest number of transactions (12.9%), followed by Barcelona (10.7%) and Alicante in third place (6.4%) . Valencia (6.3%) is in fourth place and Málaga (4.8%) remains in fifth position.
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In general, Colliers said demand for housing in 2021 has “kicked off very strongly”. “The first half of the year was the best of any historical period since 2008. The number of residential transactions was 63.7% higher than in 2020 and 10.67% higher than in the first half of 2019″ . Performance was very good for both new housing starts (+ 44.9% over 2020 and + 23.9% over 2019) and secondary housing starts (+ 66.2% and +9.3% respectively).
Price Dynamics
In parallel, home sale prices rose again during 2021, especially in the second quarter of the year. In this sense, the strong demand that occurred in the second half of 2020 continued with slightly greater intensity in the first half of 2021. “According to Colliers’ forecast models, we estimate additional price increasesof 1-2% by the end of 2021, both in new housing and in secondary housing,” points out Antonio de la Fuente , Managing Directorof Corporate Finance at Colliers.
There is defineddeterminedprice stability in 2022 as a whole, “although some areas where demand is strong could see increases of 5% to 10%, more in new housing than in secondary housing.” In particular, this phenomenon could occur in six markets, including Alicante.
“Demographic growth over the last four years (+900,000 inhabitants) will continue to boost housing demand, especially in markets such as Madrid and Barcelona, as well as in Malaga, Balearic Islands, Valencia, Alicante and Mercia,as driven by foreign demand,” adds Jorge LagunaJorge Laguna , director of business intelligence Colliers.