Malaga ended last year as the most expensive province in Andalucía in which to buy a property, with a revaluation which until November was more than two per cent, the average increase in property prices in Spain during 2021. Analysts are expecting an even bigger rise in 2022, and believe it could be as high as four or five per cent.
Since the start of the Covid pandemic, the price of property in Malaga has risen by five per cent. In November, the year-on-year increase was 2.13 per cent, according to the pisos.com monthly report on sale prices. The rise in prices for resale property in Malaga has been lower than some others in Andalucía, such as Huelva (4.51%) and Granada (2.69%) but even so the average price is still one of the highest, at 2,203 euros per square metre.
This is much more expensive than in Cadiz (1,483 euros per square metre) and Seville (1,401 euros), which are the second and third most expensive provinces in which to buy a home.
In Malaga city, however, the revaluation of properties was higher.
Compared with the same month in 2020, the average price of housing in November experienced a year-on-year increase of 5.3%(the highest among all the provincial capital cities) to an average price of 2,460 euros per square metre, almost reaching the level of Cadiz (2,474 euros) as the most exclusive at that time.
The revaluation of housing prices was even higher in some other municipalities in Malaga province, such as Alhaurín de la Torre (up by 8.44%), Ronda (8.37%), Manilva (8.36%), Rincón de la Victoria (7.46%) and Nerja (7.32%).
Factors such as the end of restrictions on mobility which paralysed many operations in 2020, the increase in household savings and an interest in property as an investment in order not to lose purchasing power due to inflation are some of the reasons, according to Ferran Font, the director of Studies at pisos.com, that property prices increased in 2021 and he expects this to continue in 2022. All of those led to an increase in demand last year, which resulted in a revaluation of properties.
"We shouldn't be alarmed by the rise in prices, because it is within what was expected given the upturn in demand.
"That was supported by accumulated savings to avoid inflation through property purchases and avoid more volatile markets," he said, adding that "financing is becoming cheaper" as another of the factors which influence the increase in interest in buying property.
Font said that, compared with the data for 2020, it looks as if the number of property sales rose by around 31 per cent last year.
Between January and October, according to figures from the National Institute of Statistics (INE), in Malaga province the number of transactions rose by 39.38 per cent compared with the same period in 2020.
Looking ahead in 2022, the analysts at pisos.com predict that prices will continue to rise and Ferran Font believes the increase will be around four or five per cent. However, he does not expect any drastic revaluations, because "both supply and demand are seeking stability," he explained.
In addition to the factors mentioned above, an expected increase in prices for new homes due to rising construction costs because of the lack of raw materials and the shortage of skilled labour could transfer that tension in prices temporarily to resale properties.