Welcome to the latest Guide to Malaga report on the Malaga property market. In it, we take a snapshot of the situation in the city with the latest data available. Our report offers insight into prices for property in Malaga, the latest sales figures and what sort of return you can expect from buy-to-let. And we include highlights from recent reports on the market in the city.
Why a Malaga Property Report?
Malaga province has been a popular location for foreigners to buy property for decades. But homes in Malaga city are recent arrivals on the must-buy list. Since Guide to Malaga began back in September 2015, we have noticed an exponential rise in interest in the city’s property market.
Post lockdown it appears to be even higher- we’ve had more emails than ever asking for advice on where, what and how to buy. Interest is high among Northern Europeans keen to buy in Malaga. We’ve compiled this report in response to this demand for information. And as always, if you need any more, get in touch.
Property prices in Malaga
Figures for changes in property prices in Spain always tag behind in time so many are often at least 3 months old. In this Malaga Property Report we quote the latest available.
In Q1 2020, the average price per m² in Malaga was €2,010. This is 3.9% up in the year and 0.9% higher than Q4 2020, according to the Registrars Association latest quarterly review. Figures are based on prices registered in title deeds. Gesvalt (prices based on valuations) reported that Malaga’s average price per square metre (€2,019) was the fifth highest in the country, ahead of Barcelona and just behind Madrid.
Tinsa (Spain’s largest valuation company whose data is also based on valuations) reports that prices went up by 5.1% in the year to Q1 in Malaga city, compared to a national rate of 0.5% and provincial rate of 0.3%. Prices stood on average at 34% below their peak in Q2 2008.
2021 continues with price rises and Malaga is just 2.8% off its highest price ever, registered in April 2007. In May this year, Idealista found that the average for asking prices in Malaga was €2,127 per m², down 0.2% in 12 months.
Biggest price hikes
The areas with the highest price rises were Puerto de la Torre (up 6.9%), East (up 6.1%), and Ctra de Cadiz (up 2.3%) in the year to May. These figures confirm the continuing trend to move out of the city centre into the suburbs. The Centre saw a consolidation of price adjustment (down 4.6% in the year) and the East had the most expensive property with the square metre price at €2,848.
Property sales in Malaga
The latest statistics for Malaga province (Q1 2021) from the Registrars Association are as follows:
- 23,518 sales in 2020.
- Resale property sales fell by 27.5% but purchase of new-build properties in Malaga went up by 26.2%.
- Foreigners accounted for 25.6% of all purchases (third highest in Spain) with a majority of British buyers.
- Malaga had the third highest number of new-build sales per 1,000 inhabitants in Spain.
- The province had the fifth highest sales after Madrid, Barcelona, Alicante and Valencia.
The national statistical institute (INE) reported that there were 2,055 sales in the province in April, slightly below the figure for March and considerably higher than March 2020.
Time spent on the market
The length of time a property spends on the market is a good indication of market temperature. A study of properties listed in Idealista found that in April, 40% of homes on the market spent less than one month on the site. Around 12% took over a year to sell.
Rental returns in Malaga
In their annual report for 2020, Colliers International reported that rental return for buy-to-let properties in Malaga was 5.5%. This is higher than both Madrid (5.2%) and Barcelona (4.9%). Returns in Malaga vary between 4% and 4.75% in the Centre and East and you can expect slightly higher (5.35% to 6.75%) in all other districts in the city.
In common with many Spanish cities, Malaga has seen the supply of long-term rentals rise sharply. According to Idealista, the number of available lets went up by 120% in Malaga city in the year to March. Great news for those looking to rent accommodation in Malaga. Will it result in better returns though?
Rental rates have dropped since last year and in May, the average rent per square metre was €9.40 (Idealista). This figure is 8.2% lower than May 2020. Rental rates fell by 9.8% in the centre.
Malaga province has 31,736 holiday lets according to INE calculations, the second-highest in the country and well ahead of destinations such as the Balearics and Barcelona.
Where’s the property market in Malaga going?
Looking at reports by Spain’s largest valuers and property consultants, optimism is definitely in the air. The latest Tinsa evaluation was very positive:
“Figures point to both Malaga city and Costa del Sol property markets experiencing a quick recovery as soon as the health situation is back to normal.” Malaga on the starting blocks, Tinsa 11 May 2021
Prices have, on paper, varied little and investors waiting for a flurry of bargain properties have so far been disappointed. And the latest statistics show that prices are showing no sign of going down. Plus there would appear to be plenty of demand – the population of Malaga province increased by 8,000 in 2020, the highest in Spain. According to Savills, many new arrivals are young, qualified and affluent.
Much, as always, will depend on your personal circumstances. Some buyers may want to take advantage of rocket-bottom mortgage interest rates and strong competition among banks for your money. Others might like to wait and see.
Whatever your reason and your timeline, one thing’s for sure – Malaga is a great place to live whether you buy or rent!
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