This percentage could be reached more in new than used housing and in certain areas where demand is growing strongly.

This percentage could be reached more in new than used housing and in certain areas where demand is growing strongly.

This percentage could be reached more in new than used housing and in certain areas where demand is growing strongly.

Panoramic view of Madrid.

If there has been a bastion that has strongly recovered the data prior to the pandemic, that is none other than housing. In fact, 2021 will be the year with the highest sales of the last decade. But how will 2022 behave? Using a popular phrase, it can be said that it looks good.

Among other reasons, because the Recovery, Transformation and Resilience Plan is on the table. In other words, the Next Generation funds will allocate 6,820 million euros to promote the rehabilitation of homes and buildings, the regeneration of neighborhoods and the promotion of affordable rental housing. “In 2022 we will see an increase in the rehabilitation and extension of housing, which already accounts for 22% of all the building licenses that are requested, ”says José Vázquez Seijo, executive president of the appraiser Euroval.

In addition, there is a lot of liquidity and interest rates remain low. Without forgetting that high inflation could lead to a progressive withdrawal of stimuli by the European Central Bank (ECB). In other words, the doors would be thrown wide open to the absolute dominance of fixed mortgages.

ANDs a good time to buy because there is a lot of liquidity and interest rates are very low. Also, many want to anticipate to avoid losing purchasing power due to inflation and avoid the increase in prices and the delays that the lack of materials will generate”, points out Ferran Font, Director of Studies at It must also be taken into account that the Covid is causing delays and stoppages in new construction. And that skilled labor is scarce.

So what will happen to prices? According to Tinsa, new and used housing has closed 2021 4.3% more expensive than a year ago.In 2022 the increases will continue. ANDhe next year they will be somewhat more pronounced, between 4% and 5%. yes, they are not expectedandscenarios of abrupt overvaluations because both supply and demand seek stability”. And adds: “By 2022, the ideal is that the increase in sales stays around 3%. ANDs which adjusts to what we understand as a healthy functioning of the market”.

At Colliers they go a little further. “We observe some price stability in general terms, although increases of between 5% and 10% could occur, more in new housing than usedin some areas where demand is growing strongly”, indicates Antonio de la Fuente, managing director of Corporate Finance.

These areas are, specifically, half a dozen: Madrid, Barcelona, ​​the Balearic Islands, Valencia, Alicante and Malaga. Real estate agents, who are the ones who really have the pulse of the market, believe that by 2022 this stability or a slight increase will be the trend and they remain quite optimistic about the future”, apostille José Manuel Fernández, deputy director general of the Union of Real Estate Credits (UCI).

Turn in the rental market

With regard to rent, this will be pending the preliminary draft of the Housing Law. His intention is to turn the market around. “It must be acted with prudence because punishing the big holders is counterproductive”, points out Ferran Font.

The rent will end the year with a year-on-year cut between 1 and 1.5%. “The rental market has shown that it is capable of self-regulation, although always at a slower pace than society demands, since economic difficulties expelled many tenants from certain areas before the adjustments were extended”, add font.

The lack of labor is one of the 'evils' of construction.

The lack of labor is one of the ‘evils’ of construction.

According to Vicenç Hernández Reche, president of ANAI (National Association of Real Estate Agents) and of AIC (Association of Real Estate Agents of Catalonia), “the new legislation may cause investors not to identify an opportunity to make their investments profitable”. And adds the CEO of Tecnotramit: “This issue, added to the situation of high inflation, will cause rent revisions to translate into price increases”.

An increase that from the General Council of COAPI of Spain they describe as “slight”. Along with investors’ fear of the law, we must add the limited supply of residential new construction that exists in Spain, which would help with those who replace their homes and keep the previous one for rent. “That means that the supply of rental housing does not grow as it would be natural,” they add.

residential investment

Javier Kindelán, Vice President of CBRE Spain, is clear about what it will be the behaviour of residential investment: “The appetite investor that draws and supports confidence in a recovery of market fundamentals is solid and allows us to predict a future with good prospects and a lot of activity”.

Hence, Constanza Maya, Director of Operations and Expansion of Engels & Volkers for Spain, qualifiesthat next year as promising: “The foreign demand has already returned and the owners are returning to act normally according to the cycles and periods that, until now, had been altered by fear and uncertainty”.

In other words, Spain is still an interesting country. And the real estate sector is, more than ever, a refuge value. “In the most demanded locations, both first and second homes, prices have been maintained throughout 2021. It is foreseeable that they will begin to rise gradually during the next financial year.”, says Constanza Maya.

Positive forecasts where, one more year, the logistics and residential markets will be the clear bets of investors. “We estimate that there will also be a notable increase in activity in the Data Center market, which will no longer be an incipient market. Also in the hotel segment hand in hand with the recovery in demand”, specifies Mikel Echavarren, CEO of Colliers.

Very interesting, for the next year, it will be to see if the polarization of residential investment continues. Madrid, Barcelona, ​​Valencia, Malaga, Alicante and Seville concentrate a huge part of this investment. “The market does allow room for geographic diversification. Zaragoza, the Basque Country, Valladolid, A Coruña, Granada… but investors seem to want, for the time being, to reduce risk based on the good demand data from the main metropolises”, says Alejandro Bermúdez, CEO of Atlas Real Estate Analytics.

As all the aforementioned aspects evolve (inflation, Next Generation funds, Housing Law, price of raw materials, labor, omicron…), the real estate sector will suffer more or less during 2022.

“But simultaneously new challenges are revealed, such as the necessary incentive for public-private collaboration for the so-called built to rentand opportunities such as promoting regulatory developments from the Administration that are capable of generating legal certainty for investors”, points out José María Basañez, president of Tecnitasa and Atasa.

And the million dollar question: Will there be a bubble in 2022? “There are no signs that indicate a real estate bubble situation like the one that occurred in the previous crisis,” concludes Vicenç Hernández Reche.


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