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Work on the site of the Torre del Río development where luxury tower blocks are being built in Malaga. Marilú. Báez
House prices continue to rise on the Costa del Sol, one of Spain's most active markets
Property

House prices continue to rise on the Costa del Sol, one of Spain's most active markets

Latest data shows the average price per square metre of a property for sale in Malaga province has soared to 2,412 euros, with rental prices also continuing to rise

Jesús Hinojosa

Malaga

Friday, 26 April 2024, 12:14

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After a slight drop in the third quarter of last year, the price of housing has risen once again in Malaga province, the latest data shows.

In the first three months of this year, the average price per square metre of a property for sale in the province including the Costa del Sol climbed to 2,412 euros, according to valuation firm Gesvalt. It is 1.2% more than the figure recorded at the end of 2023 and about the same figure as a year ago, when the valuer's studies showed an average price of 2,419 euros per square metre. The data shows that the 4% drop in the prices of property for sale in Malaga province in the third quarter of last year was a one-off event.

Additionally, rental prices continue to soar in both Malaga city and throughout the province. According to Gesvalt data, the average rental price at provincial level is 14.32 euros per square metre, which is 13.5% more than a year ago and 3.2% more than three months ago.

However, the increase in rent is most noticeable in Malaga city, where the average cost has risen to 14.41 euros per square metre, 16% more than a year ago, according to the data.

In the city, the average price of housing for sale stands at 2,374 euros per square metre, which is 8% more than in the first quarter of 2023 and 2.5% more than in last year's year-end report.

Upward trend to continue

According to Gregorio Abril, Gesvalt's regional director for Andalucía and Extremadura, house prices in Malaga are set to continue "the upward trend of recent months, but at a more moderate pace than in recent years, tending towards stabilisation, after the slight slump in demand caused by successive interest rate increases and a general economic slowdown".

"Once this phase has been overcome, and with the prospect of upcoming interest rate cuts, demand has once again been reactivated in a market that remains under pressure, pushing prices up again," Abril said.

Malaga is one of the most active real estate markets in Spain, "the demand, both national and international is very active, compared to a supply that, despite the efforts of the city council and the great developer activity, is still insufficient to meet it", the real estate expert added.

"All these factors lead us to believe that there will not be a change in trend in the coming months and it is not possible to foresee when price rises will slow," he said.

As for the unstoppable rise in rent, Abril pointed out that this is a "more common issue than that of buying and selling".

"While supply is more limited than for sales, there is a transfer of demand from the sales to the rental market, due to the number of house-hunters who are unable to afford to buy a home at current prices and decide to opt for renting. Our forecast is that the current trend will continue over the next few years," he added.

Costa rentals

On the Costa del Sol, Marbella continues to lead in rental prices with an average of 18.8 euros per square metre, 12% more than a year ago. Also noteworthy is the rise in rent in towns such as Torremolinos and Benalmádena, possibly due to the increase of prices in Malaga city leading to a rise in demand for rentals in these neighbouring towns.

In the case of Torremolinos, rent has risen to 14.6 euros per square metre and is now at the same level as Estepona, with a year-on-year increase of 12%, the data shows.

At the other end of the scale Vélez-Málaga offers rents at half of the average registered on the Costa del Sol, with prices around 7.5 euros per square metre.

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