In the Valencian Community and Andalusia is where foreigners buyers bought the most
Foreigners bought 70,163 Spanish properties in the second half of 2022
Foreign buyers have a significant impact on the second home market in Spain. After virtually disappearing during 2020 and the beginning of 2021 due to mobility restrictions, international investors have returned with renewed enthusiasm. How has their activity been one year after the rebound effect caused by the pandemic?
According to data from the College of Notaries, the dynamism continued in the second half of 2022: property purchases by foreigners (both residents and non-residents) accounted for 21.1% of all property transactions in Spain during that period. This represents the highest percentage recorded in the historical series of the notaries, which began in the first half of 2007.
But how many Spanish properties do foreigners actually buy in Spain? According to Tinsa, the weight of foreigners in the housing market is particularly remarkable considering that their share of total property purchases had dropped to 15% in the second half of 2020 and the first half of 2021, which was six percentage points lower than the end of 2022. At that time, Spaniards were already recovering their activity after the lockdown, but international restrictions still limited the transactions of foreign buyers.
Before 2022, the period when foreigners represented the highest percentage in the Spanish property market was in 2015 and 2016. After the financial crisis, the international market, primarily focused on coastal and second homes, experienced a revival before the domestic market.
Conversely, during the real estate boom years, the opposite was true, with a low share of foreign buyers in the total market. They accounted for only 6-7% of purchases, which was nearly 15 percentage points lower than the current figures.
That 21% share represented by the foreign market in the second half of 2022 translates to 70,163 properties, a 9.7% increase compared to the previous year but a 4.5% decrease compared to the first half of last year. Therefore, the slowdown in activity is also noticeable from the perspective of foreign buyers.
Who are these buyers? Residents in Spain accounted for 55% of property purchases made by foreigners. Among them, Moroccans (4,629 properties) and Romanians (4,312 properties) were the most predominant nationalities. These were local workers who purchased properties with average prices of around 680 euros per square meter for Moroccans and 1,036 euros per square meter for Romanians. These figures are significantly lower than the average of 2,089 euros per square meter paid by foreigners (both residents and non-residents) in Spain.
For non-residents, who primarily buy for investment and second homes, the average price is even higher at 2,558 euros per square meter. In this segment, Germany had the highest number of purchases, with 4,691 properties acquired in the second half of the year. This is only slightly more than the number of properties bought by resident Moroccans in Spain.
When looking at the overall picture of 70,163 properties acquired by international buyers, the United Kingdom emerged as the leading source with 7,520 purchases, representing 10% of the total. They were followed by Germans, accounting for 9.3% of purchases, and the French, who made up 7.3%.
"The nationalities that experienced the highest growth in the number of transactions over the past year were Ukrainians, who doubled their purchases compared to the second half of 2021. Americans also showed a significant increase of 36%, followed by Argentinians with a 34.5% increase. In terms of price, Swiss investors paid the highest average price per square meter at 2,904 euros, followed by Swedes, Danes, and Americans, all around the 2,800 euros per square meter range.
The regions with the lowest number of purchases by foreigners were Cantabria and Extremadura, while the Community of Valencia and Andalusia had the highest number of transactions," states Susana de la Riva, Marketing and Communications Director at Tinsa.