We know that Spain is a popular destination for foreign investors and foreigners looking to own their own holiday getaway in the sun. But when we think about those individuals who buy property in Spain, we traditionally think about Britons, Americans, French and Germans, with Britons being by far the largest foreign investors in Spain. But throughout 2022 a growing number of buyers from other smaller European countries have been investing in property in Spain, which Dutch, Irish and Norwegian buyers investing in Spanish properties at record rates. Here’s everything you need to know about this trend, and how it might affect you:
A Huge Market for Foreign Buyers
In the first half of 2022, foreigners purchased 72,987 properties in Spain. The result of the so-called ‘Covid-effect’, in which visitors are returning to Spain in their droves, this is the highest number of foreign investors in the country since records began back in 2007. In fact, one fifth (20.3%) of all property sales in Spain where purchases made by non-Spaniards. As already mentioned above, many of these property buyers were British, French or German, but what is interesting is the rise in a newer group of buyers from smaller or comparatively unexpected countries.
Between January and June 2022, buyers from the Netherlands, Norway and Ireland purchased double the number of properties in Spain than they did during the same period in 2021. This figure represents a 121.5% increase in purchases made by Dutch buyers, a 119.5% increase in purchases made by Norwegian buyers, and a 106.7% increase in purchases made by Irish buyers. So how many houses is that in real terms?
- Dutch buyers purchased 3,641 Spanish homes between January and June.
- Irish buyers purchased 1,395 Spanish homes between January and June.
- Norwegian buyers purchased 970 Spanish homes between January and June.
A Growing Interest in Spanish Properties
As well as voting with their feet and investing in Spanish properties, foreigners are also actively looking at and searching for Spanish properties from the comfort of their own homes. The first half of 2022 saw a search in online searches for Spanish property by foreigners. The number of searches made by visitors from Holland, Ireland and Norway doubled during this period. The country driving this upsurge was Ireland, who demonstrated a 32% year-on-year increase in the number of online property searches. In comparison, Norwegian searches were up by 18% year-on-year.
Why Are Foreign Investors So Attracted to Spain?
Spain’s reputation for sun, sea and sangria means that it is the perfect location for investors looking to purchase their own holiday bolt hole. But foreigners are attracted to Spain because of more than just the good weather. Spain also boasts an excellent telecommunications system that will make it easy to telework from the country: there has been a cultural shift towards teleworking in many European countries as a direct result of the Covid-10 pandemic. The Spanish government are targeting potential teleworkers by introducing Startups Laws that will appeal to both digital nomads and small businesses. Spain is also a great place for retirees, offering a high standard of living. Finally, as a result of the current energy crisis, living in a warmer climate is a great way to save significantly on your energy bills, particularly during the winter months.
Another factor in why Spain is so attractive to foreign investors is that property in the country is relatively cheap, particularly when compared to Northern Europe. This means that many foreigners are able to own property in their home country and property in Spain, using their Spanish bolt hole as an escape from the harder winter months. For this reason, the most popular locations for Spanish buyers are in warmer parts of the country such as the Canary Islands, Costa del Sol and the Valencia region, but Malaga on the Costa del Sol in particular has emerged as a destination for foreigners investors from smaller European countries.
What Types of Property Are Popular?
Foreign investors are, as a general rule, looking for different types of property compared to native foreigners. Foreign investors generally buy larger properties and look for large indoor and outdoor living areas. They also pay more than Spanish buyers, on average. The average amount spent on property during the first half of 2022, by nation, was:
- €2701/m2 spent by Norwegian buyers
- €2252/m2 spent by Dutch buyers
- €2092/m2 spent by Irish buyers
By contrast, the average price across all foreigners was €2062/m2, whilst Spanish buyers spent an average of just €1560/m2.
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