Housing Prices Surge: Insights from Q3 2024
The prices of housing have experienced a significant increase in the third quarter of 2024, rising by 8.1% year-on-year, marking the largest surge in two and a half years, since early 2022. This data was released by the National Institute of Statistics (INE) on Thursday. In comparison to the previous quarter, prices rose by 2.8%, continuing a trend that has persisted for over forty consecutive quarters, specifically 42 quarters, that began in 2014.
New homes remain the most expensive option on the market, although their cost increased by less than 10%. According to the data, new homes were priced 9.8% higher than the previous year, despite a decline of 1.4 percentage points in the annual rate. This shift breaks a streak of two consecutive quarters where price increments surpassed 10%.
Conversely, the cost of secondhand houses saw an increase of 7.9% in the third quarter, reflecting a rise of 0.6 percentage points compared to the previous quarter. This marked a consistent upward trajectory since the second quarter of 2014. The latest uptick in housing prices for both new and used homes follows a 7.8% rise in the second quarter of the year, where new homes saw their biggest price hike in almost 17 years (11.2%), while secondhand homes increased by 7.3%.
Although new housing prices steered clear of double-digit growth for the current quarter, they achieved a substantial 2.8% increase when compared to the second quarter. The upward trend in housing prices has now persisted for three consecutive quarters.
When analyzing by type of housing, both new and secondhand homes witnessed an identical 2.8% rise in prices during the third quarter relative to the second quarter of 2024. This continues a steady increase that has been ongoing since the second quarter of 2014, following a six-year slump that began with the real estate crash in the second quarter of 2008.
The lowest recorded prices occurred in the third quarter of 2012, marking a dramatic decline of 15.2%. In the recent period of July to September, housing prices have shown upward momentum across all regions, with three communities—Navarra (10.7%), Andalucía (10.6%), and Aragón (10.3%)—experiencing increases exceeding 10%.
Apart from these three, other regions which surpassed the average increase include La Rioja (9.2%), Murcia (9.0%), Cantabria (8.9%), Comunidad Valenciana (8.8%), Ceuta (8.5%), País Vasco (8.4%), and Extremadura (8.2%). The capital city of Madrid and the region of Cataluña saw more modest increases at 7.2% and 6.8% respectively. The smallest rise was recorded in the Balearic Islands with an increase of 5.8%, followed closely by Cataluña, Asturias, and Castilla-La Mancha, all seeing increments of 6.9%.
As housing prices continue their upward march, the implications for potential buyers and the overall market dynamics remain significant, reflecting ongoing adjustments in the economic landscape.
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