Housing 2024: forecasts from the real estate sector
The year 2023 will go down in history as a unique year marked by contradictions in the real estate market, especially concerning housing. Following a record-setting year in 2022, it concludes with a decrease in the number of mortgages and the volume of real estate transactions. Despite this, all indications point to it being the second-best year since 2007.
Meanwhile, housing prices continue to rise, especially in new residential properties, driven by demand far exceeding supply. Major cities remain a significant focus, and various experts and studies predict growth, albeit at a slower pace than the current year, and even stabilization of prices. This sentiment is echoed by the real estate sector as a whole, as evidenced by estimates from major companies:
The forecasts from Solvia’s III Solvia Market View 2023 indicate that housing prices will continue to rise in 2024. According to the developer, increases ranging from 1.5% to 2.5% will be recorded, similar to this year, despite a reduction in the number of property transactions, which could decline between 5% and 8%. Solvia’s Real Estate Business Director, Ernesto Ferrer-Bonsoms, asserts that the next year will continue to be a “dynamic” year in real estate transactions. Thus, the trend of stabilization initiated in 2023 will be maintained, while prices will not reflect the “slight” reduction in property transactions and will maintain “similar advances” to those of this year.
Culmia asserts that, despite the difficulty of making predictions and the dependence of the housing market on many factors, there are enough indications that 2024 will see a certain moderation in housing prices. While prices in major cities such as Madrid, Barcelona, Malaga, and Bilbao are expected to remain stable or even increase, decreases will mainly focus on smaller locations.
Hábitat Inmobiliaria remains positive and cautious, pointing to a continuation of the upward trend in prices. As Patricia García, Delegate of Hábitat Inmobiliaria in the Levante region, states, the company rules out a possible real estate bubble or a sharp market correction. Moreover, despite a slight deceleration, they estimate that sales rates will remain steady.
Premier España Premier España faces 2024 with optimism and foresees a year similar to the second half of 2023, with demand for housing but a more reflective approach from buyers. The director general, Vicenç Topas, states in an interview with Ok Diario that housing production is very scarce, and the imbalance between housing production and household creation in both Barcelona and Madrid is enormous. Regarding price trends, they anticipate sustained increases.
On the other hand, developers like Neinor Homes plan to continue advancing their strategy of co-investing with partners to promote the construction of homes in the coming months. The developer has recently acquired three plots in Malaga through a joint venture with the Orion Capital fund, where they can build around 500 homes. Just a few months ago, the company reached an agreement with Urbanitae to create a joint venture of 150 million euros to invest in residential development for sale (Build-to-Sell).
Rising Rental Prices Regarding rental housing, 82% of companies in the real estate sector predict that rental prices will continue to rise next year, given the strong demand for rental housing. This is reported in the Barometer of Real Estate Companies in Spain 2023, compiled by EjePrime, based on a survey of 300 companies in the sector.