The Costa Brava property market forecast for 2024

Property prices at the Costa Brava will continue to increase

Price behaviour in the real estate market is a result of demand by home searchers and on the other hand the availability of properties. We will briefly discuss the influence of these two important items.

Demand for properties in all price ranges remain stable and high.

Apart from the already very often mentioned advantages of the Costa Brava like the Mediterranean climate, the beautiful coast, medical services, high level of safety, gastronomic excellence etc. etc. there are other external factors that make the costa Brava the first choice for real estate investors.

First of all is change in the behaviour of most people after Covid 19; there is a strong desire for traveling and exploring, while at the same time looking for independent means of traveling. The Costa Brava is an area that is easily reachable by car in 1 day from a lot of places in Europe, like Germany, France, the Netherlands and Belgium. Especially over the last years we have noticed this as a very important argument among buyers of properties.

Another effect is that local people living in Barcelona and Gerona tend to escape from the big cities because they are adopting another lifestyle and are buying properties in a more quiet environment along the coast. During the Covid period a lot of companies learnt to work on distance and this makes it for quite some people possible to live at 100 km or more from their work.

Already for a couple of years we also notice a tendency that people from northern countries have the desire to leave their region and start a new life in Spain. The main reasons therefor (so they tell us) are the weather, the mentality, the ease of moving inside Europe and the fact that the house prices in their country are still considerably higher than in Spain. This means, that these expatriates can sell their property, buy a new property here and with the surplus they can finance te start of a new life here.

Supply of properties is not keeping pace with demand.

The growth of the housing supply on the Costa Brava is limited. This is due to the following important factors:

Based on the fact that most homeowners do not want to live too far from the coast, the supply of building plots has become limited. The remaining plots are either not optimally oriented with regard to the sun or are so steep that construction costs are very high. As a result, there is a noticeable trend that houses on beautiful plots and built in the 1960s are being demolished in order to build a new house. Of course, this is also associated with high costs.

Due to an increasing desire among the local population and local authorities to keep the Costa Brava sustainable, quite a few restrictions have arisen in recent years regarding places where construction is allowed at all.

An example of this is the Ley de Costas, which no longer makes it possible to build within a certain distance from the coast in many places.

Rising mortgage rates

Rising interest rates naturally mean (because that is its purpose) that the demand for houses by buyers who need a mortgage decreases. This effect is especially noticeable in regions in Spain where houses are mainly purchased for permanent residence.

On the Costa Brava however, real estate transactions mainly take place in second homes, with buyers in most cases not needing any mortgage; these often concern small investors who are looking for a safe heaven for their capital at a time of economic uncertainty and unstable global situations.

Rising interest rates therefore have no influence whatsoever on the purchasing behavior of home seekers on the Costa Brava

Conclusion

In our opinion, a growing demand for properties on the Costa Brava together with a too slow growing supply will result in a moderate growing price increase during 2024 and the coming years.

Do you consider selling your house at the Costa Brava and want to know more about the value of your property, contact Porfinca for a valuation. If you wish so, such a valuation can be performed at distance without paying a visit to your home.