Tenants face 5.1% increase to rent in Spain
Renting a property finished 2019 5.1% more expensive than at the start of the year. The average price per square metre per month stood at €10.18 in December. This is the highest national average price since 2006, beating the previous high of €10.12 per square metre per month, which was seen in May 2007.
Additionally, the annual increase of 5.1% is the sixth highest annual increase in the last 13 years and the fifth consecutive annual increase. The last time there was an annual fall in rental costs was in 2014, according to figures from fotocasa.
“The rise in the average price of rental housing has been widespread in almost all autonomous communities in 2019, although not all saw rises of the same strength. As an example, the communities of Catalonia and Madrid that in recent years had risen strongly have begun to moderate their growth with increases of 3.1% in the case of Catalonia and 2.3% in the case of Madrid. It is expected that the rest of the communities will follow and price increases will begin to moderate,” explained Ismael Kardoudi, director of studies at Fotocasa.
Non-Stop Growth
The interannual variation rate (comparing each month to the same month of the previous year) has been increasing in Spain since February 2015, the month in which it began to register the first increase in rental prices since February 2008.
In fact, since the first increase in rental prices at the interannual level (1%) was detected in February 2015, prices have not stop growing, with the largest single growth seen in March 2018 (18.8%). However, the bulky double-digit year-on-year increases recorded in 2017 and 2018 have not been repeated in 2019 and the increases recorded have barely exceeded 5% since the second quarter of the year.
16 Autonomous Communities See Increase
At the end of 2019, the average price of rental housing has increased in 16 of the 17 autonomous communities. The largest increases were registered in Valencia with 10.2% and the Basque Country with 10%. These were very closely followed by Andalusia (9.4%), Galicia (8%), Region of Murcia (7.8%), Aragon (7.2%), Navarra (5.9%), and Cantabria (5.2 %). Communities to see increases below 5% include La Rioja (4.7%), the Canary Islands (4.4%), Asturias (4.3%), Catalonia (3.1%), Madrid (2.3%), Castilla-La Mancha (2.1%), Castilla-León (0.9%), and Extremadura (0.3%). On the other hand, it is striking that only the Balearic Islands saw the price of renting fall with a slight decrease of 0.3%. This is significant as only a year ago the Balearic Islands closed 2018 with the largest annual increase of all the communities (+14.9%).
In 2019 the Community of Madrid takes first place as the most expensive for renting with an average of 14.86 euros p/m² per month. This puts Catalonia in second place for the second consecutive year with an average price of 14.14 euros p/m² per month, followed by the Basque Country (13.06 euros p/m² per month), the Balearic Islands (12.19 euros p/m² per month) and the Canary Islands (9.74 euros p/m² per month).
Rises in 43 Provinces
With increases in rental costs in 43 provinces, we see a massive 86% of the Spanish provinces saw a price rise.
Ten provinces even saw annual double-digit increases. The provinces with the highest rises in 2019 are: Seville (14.2%), Castellón (12%), Lleida (11.8%), Girona (11.6%), A Coruña (11.5%), Bizkaia (11.4%), Valencia (11.4%), Cádiz (11.1%), Toledo (10.7%) and Alicante (10.2%). Although well below double-digits, the cost of rental property in Malaga increased 5.1% in December.
The biggest falls occurred in Palencia with -2.6%. They are closely followed by Cáceres (-1.8%), Cuenca (-1.2%), Lugo (-0.7%) and the Balearic Islands (-0.3%).
In 2019 Barcelona was, for the fifth consecutive year, the most expensive province in Spain for renting with an average price of 15.74 euros p/m² per month. Madrid occupies second place for the third consecutive year with 14.86 euros p/m² per month. In third place in the ranking of provinces, with an average price of 14.52 euros p/m² per month, we find Gipuzkoa for the third year.
