The Valencian Community keeps gaining weight in the Spanish property market. In just two years the region has climbed two places in the ranking of Spanish regions with the most home sales, overtaking Catalonia and Madrid. According to the National Statistics Institute (INE), in the first seven months of 2023 there were 59,917 sales of new and resale homes here (only Andalusia had more, with 74,136), or 16.4% of the national total.
Many property experts believe this trend is driven by several factors. Among them are strong and steady demand from both Spanish and foreign buyers, affordable prices, high yields for investors and the appeal of life on the Mediterranean coast. All of this helps the market cope better with the impact of rising interest rates and more expensive mortgages.
Alicante leads in sales to foreigners
Foreign buyers, who are less sensitive to rising prices and interest rates, account for a large share of sales in the region, especially in Alicante. According to the Property Registrars, in the second quarter of 2023 they made 44.67% of all purchases in this province, the highest figure in Spain. The British, Germans and French traditionally set the tone here, but in recent months the number of buyers from Russia, Ukraine and the Netherlands has grown.
Another key point is that the province has managed to shake off seasonality. More and more property owners live here all year round, helped, among other things, by good land and air connections. High-speed trains and new low-cost operators have increased the number of trips from other parts of Spain, and the airport links Alicante with more than 120 European cities.
Affordable property prices and high yields
Besides a good location and well-developed infrastructure, experts point to another factor behind the growth in sales in the Valencian Community: house prices that are more affordable than in other Spanish regions. According to the Idealista portal, in August the average resale price in the Valencian Community was €1,738/m², below the national average (€2,004/m²) and well behind other regions such as the Balearic Islands (€3,987/m²), the Community of Madrid (€3,139/m²), the Basque Country (€2,844/m²) and Catalonia (€2,345/m²). In the city of Alicante the figure is €1,820/m², in Castellón €1,223/m² and in Valencia €2,278/m².
The Valencian Community is also attractive because many areas have sports facilities, footpaths, beaches and places for outdoor activities. And this is true not only of the big cities but of small towns and villages too.
The region also offers good returns on residential investment: an average of 7.1% a year in Castellón and more than 6% in Alicante and Valencia. Several municipalities are among the most profitable in the whole country: Elda, Alcoy, San Vicente del Raspeig, Elche (all in Alicante), Torrent and Sagunto (both in Valencia).
