Ben Pawlowski
SPAIN’S property market continues to go from strength-to-strength with a record 64,730 home sales in the month of July, the highest figure registered since records began.
The record-breaking tally comes fresh off the heels of news that property prices nationwide are on course to rise by over 7% this year – with the average value of a home set to tip over €1,900 per square metre for the very first time.
For many, the ongoing boom is a sign of economic momentum, helping to fuel regional growth, but others are wary of a growing housing bubble that could burst at any moment.
July’s figure was the highest ever recorded for that month since the National Institute of Statistics (INE) began collecting data – and 13.6% higher than in July 2024.
In fact, the only comparable month-long period is July 2007 when 63,371 transactions were registered.
However, that total came just months before Spain’s housing bubble burst with the 2008 global financial crisis
July’s growth was driven both by sales new (22.3% year-on-year increase) and existing homes (11.6% rise), with over 93% of deals struck related to free-market housing.
Commentators looking to explain the growth in property sales point to cheap finance options – and the number of mortgages taken out in July rose by a remarkable 25% compared to the same period last year.
The average mortgage rate was just 2.94%, lower than June’s figure of 2.99, while the total amount of capital lent to homeowners grew 34.5% to over €7 billion.
The strongest increases in property sales occurred in Extremadura (28%), Aragon (23.8%) and Castilla-La Mancha, while transactions dipped in just two regions – Navarra and Cantabria.
EXPLAINER: Is this good news – or sign of a bubble ready to burst?
Spain’s record July home sales can be read in two ways.
On the one hand, they are good news for Spain’s growing economy, reflecting strong demand, renewed market confidence and easy access to mortgages that allows aspiring homeowners to get their foot on the first rung of the property ladder.
But there are reasons to be concerned, too.
Demand continues to outstrip supply, pushing prices higher and higher, outpacing wages and making many areas unaffordable for those on modest salaries.
And the comparisons with pre-2008 are obvious, not least the record growth in transactions.
But economists believe we are still far away from those halcyon days, where all seemed rather well until the financial crash brought the world to a shuddering halt.
So while it would be prudent to exercise caution and not get too carried away, the data also points towards economic growth that shows no sign of abating with Spain continuing to outpace its rivals.
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