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 Q4 2020, the average price per m² in Malaga was €1,788.3. This is 1.3% up on Q3 2020 and 0.9% higher than Q4 last year. Prices for new developments in Malaga went up by 6.4% in the year, however, to reach an average of €2,230.3 per m². (All data is from Ministerio de Transportes, Movilidad y Agenda Urbana; figures based on valuations and latest available). Tinsa (Spain’s largest valuation company whose data is based on valuations) reports that prices fell by 9.6% in the year to Q4 in Malaga city. They averaged €1,593 per m² and stood at 34% below their peak in Q2 2008.
These figures refer to property in Malaga in general. When it comes to homes in the centre and east of the city, TecniTasa paints a completely different picture. According to this valuations company, prices for property in central Malaga and La Malagueta average €5,200 per square metre at the end of 2020. This is a 4% increase in the year.
2021 continued with price rises. In February, Idealista found that the average for asking prices in Malaga was €2,091 per m², a rise of 1.1% in the year. The same portal also reported that Malaga recorded the highest asking price ever (€2,289) and was one of only four provincial capitals to register an increase in the first month of the year.
Biggest price hikes
The areas with the highest price rises were East (up 3.4%), Campanillas (up 5.5%) and Puerto de la Torre (up 3.6%) in the year to February. The latter two figures confirm the trend to move out of the city centre into the suburbs. The Centre saw a dip in prices (down 3.5% in the year) and the East had the most expensive property with the square metre price at €2,765.
Property sales in Malaga
The latest statistics for Malaga province (Q4 2020) from the Registrars Association are as follows:
- 23,270 sales in 2020, down 22% on 2019.
- Resale property sales fell by 28.5% but purchase of new-build properties in Malaga went up by 8%.
- Foreigners accounted for 28% of all purchases (third highest in Spain) with a majority of British buyers.
- Malaga had the second highest number of sales per 1,000 inhabitants (13.93) in Spain.
- The province had the fifth highest sales after Madrid, Barcelona, Alicante and Valencia.
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 26.2% in Malaga city in 2020 Great news for those looking to rent accommodation in Malaga. Will it result in better returns though?
Rental rates have dropped since March last year and in January, the average rent per square metre was €9.40. This figure is 6.9% lower than February 2020.
Where’s the property market in Malaga going?
The latest Registrars report for Q4 2020 revealed that although property sales had dropped, the bottom had not fallen out of the market. “The property market is showing certain resilience in general terms, both in prices and activity,” it said.
In late November, Colliers International said they expected to see prices for new-build property in Malaga to go up by the end of this year compared to 2019. On the other hand, they forecast a 5% to 10% drop in resale house prices in the city. The Institute of Economic Studies (IEE in Spanish) predicts price drops of around 10% for resale properties in Malaga this year. Those for new builds are not expected to vary much.
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.
“Changes in property prices in Malaga will depend on how quickly the owner wants to sell.” Colliers International
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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