Spain Slows Down, Malaga Steals the Show: Why?
The global economy is surrounded by post-COVID uncertainty, with wars in Ukraine and Gaza but also banks trying to protect their money. The result in the real estate sector appeared unavoidable: fewer sales and purchases, fewer mortgages, and, consequently, fewer investments.
Price Growth Cools Down, but Malaga Remains a Spanish Real Estate Gem
Despite a drop in activity levels in the real estate sector compared to the previous year, the market is battling with sales volumes higher than in 2022. Consuelo Villanueva, Director of Institutions and Key Accounts of Valuation Society affirms that the increases took place "in the main cities, such as Madrid or Barcelona, and in localities with a strong tourist component such as Malaga, Palma de Mallorca or Valencia".
She also states that “the cooling of the market exerts some pressure on prices, slowing down their rate of growth, but their trend, in general, continues to increase”. According to expert forecasts, property prices may fall by 5%, but Malaga will escape this general decline in Spain.
Malaga's growth, higher than that of Spain as a whole, makes it a city that offers many opportunities, in addition to demand that continues to exceed supply. This is why it should be emphasized that real estate investment in Malaga remains a wise choice.
Malaga vs. the Rest of Spain: Comparing Housing Market Trends in 2024
Increased demand from Spain, both locally and worldwide, is driving up house prices in Malaga. This high demand coexists with very limited supply.
Of course, developers also bought land at high prices. According to expert Carlos Smerdou (CEO of Foro Consultores), the increase in property prices in Malaga will be between 3% and 5%. It will be between 2% and 3% in Spain.
In addition, housing prices have in some cases doubled in the province since 2017, according to his studies: from €1,500/m², they have exceeded €3,000/m². Considering that in Malaga there is a lot of land for sale:
“It's a city that generates a lot of land, but demand will continue to exceed supply,” he said.
Malaga will be among the territories with the highest growth, since it is a very active market with high demand, although compared to current levels the number of sales will continue to decrease.
Why Malaga Bucks the National Trend?
The prices of homes for sale in Malaga, Spain have increased. With high demand, a growing number of households, and limited supply, price pressures will continue to increase in 2024 in the most dynamic markets, while others are expected to stabilise or experience slight declines. Why is Malaga so popular?
Malaga is defying the trend as tourists want to spend their holidays in Malaga, on the Costa del Sol. On-site, they have easy access by train, car, or on foot to all the amusement parks, beaches, shops, and above all the cultural, historical, and gastronomic places that this part of Spain offers.
Many famous cities such as Granada, Cordoba, Seville, Ronda, the seaside resort of Nerja, Cádiz, Marbella, and Gibraltar are easily accessible by train, bus, or car. The city also offers protected natural parks, and hiking trails in the mountains or along the rivers.
In addition, it is possible to make short excursions by ferry from the port of Malaga. It can accommodate the world's largest cruise ships, making it the hub for international cruises.
Malaga's Advantages Compared to Other Spanish Cities
Here are the main advantages for which investors and real estate buyers choose to invest in Malaga:
A High Rental Yield
According to the Idealista report, the rental yield will reach 5.9% per year in Malaga. This is like Barcelona, with 5.8%, but higher than that of Madrid which is 5.2%.
Growing Demand from Foreign Buyers
Demand from foreign buyers for Costa del Sol real estate remains high. Their share reaches 35.3% in the country's sector with the British in first place followed by the Germans and finally the French.
Malaga Experiences Rapid Growth
Thanks to the expansion of the metro and investments to become a cultural capital of the Mediterranean, Malaga has taken an important place in the Spanish housing market. The emphasis is therefore placed on sustainable tourism because the development of innovative green technologies is strong in Malaga.
The city has become a testing ground for new electric buses featuring revolutionary technology that recharges during the trip. This technology is expected to be introduced worldwide within the next few years.
International campaigns having a remarkable role in post-Corona marketing have made Malaga one of the great winning cities post-COVID.
Paradise for Digital Nomads
Malaga is one of the best digital nomad cities in Spain. The city has a peaceful atmosphere with easy internet access, an idyllic climate, and accommodation options. Malaga stands out for its ability to increase the quality of life of digital nomads.
Investing in 2024? Why Malaga Still Shines Brighter Than the Rest of Spain
The Costa del Sol real estate market is one of the most dynamic and active real estate markets in Spain. Demand is strong, but limited supply is reflected in rising sales and rental prices. As a result, the price of real estate reaches a high level.
According to Idealista reports, 19 municipalities saw housing prices reach new records in October. These include the capital of the Costa del Sol, Malaga. These record prices are synonymous with unprecedented demand in the context of a lack of supply. As a result, the situation is likely to persist, with new construction needing to catch up with demand.
In a global context, the markets of Spain's most sought-after cities offer good value for money and higher growth potential than other cities. The number of international buyers has almost doubled in recent years.
The market looks likely to continue to grow, but there will be regional differences, with cities experiencing higher growth rates than rural and less populated areas. Our real estate experts will be there every step of the way when you buy property in Spain. Don't hesitate to contact us today.