Barcelona, Madrid and Palma have registered the largest decreases in housing rental prices this year, punished by the impact of the pandemic. Barcelona leads the falls, with a year-on-year decrease of 9.4%, followed by Madrid (-7.3%), Palma (-6.2%), Malaga (-5.6%) and Seville (-5.2 %). Next are two other Catalan cities: Girona, with a 4.9% decrease, and Tarragona, where prices fell 4.4%.
These are data from the report on the evolution of housing rental prices in Spain in 2020 from the Idealista real estate portal, which highlights that the most dynamic rental markets have closed the year with “historical” falls. According to this study, in Spain as a whole, the price of rental housing has risen by 1.4% during 2020, to 11.1 euros per month per square meter, although in the quarterly rate, rents have been reduced by 3 , 7%.
The most expensive provincial capitals are still Madrid, San Sebastián and Barcelona
The report attributes this drop in prices in the main markets to the significant increase in the available supply, which in Barcelona and Madrid has doubled, due to the stoppage caused by the confinement. This halt has been more marked in the most dynamic markets, in which the rotation of homes was much higher. Looking ahead, the real estate portal considers it likely that “the trend in price adjustments will continue in the main capitals until the stock is diluted.”
By autonomous communities, in 2020 only in four the rental prices were reduced (Baleares, Madrid, Catalunya and Canarias). In the Balearic Islands, the decrease was 7.3%, followed by Madrid, with a 4% drop; Catalonia, with a decrease of 2.8%, and the Canary Islands, 0.7%.
Galicia tops the list of the communities with the highest increases
The rental prices increased in the rest of the autonomous communities, with Galicia leading the way, which registered a 6.7% rise. They are followed by Castilla y León (6.4%), Extremadura (4.8%) and Castilla-La Mancha (4.7%).
Despite the decreases experienced this year, Madrid and Catalonia continue to be the most expensive communities to rent a home, with 14.2 euros per square meter and 13.8 euros, respectively. Next is the Basque Country (12.3 euros per square meter), the Balearic Islands (11.7 euros) and the Canary Islands (9.9 euros).
The most expensive provincial capitals are Madrid and San Sebastián, where the average rent is 15 euros per square meter, followed by Barcelona (14.9 euros) and Bilbao (12.7 euros). In Orense it is where the rent has increased the most during 2020, with an increase of 13.5%; followed by Lleida (12%) and Teruel (11.1%).
Meanwhile, experts from the Institute of Valuations (IV) warned yesterday that the uncertainty due to the possible changes that could be approved to regulate the rental market will be part of the leading trends in the real estate sector over the next year. However, they pointed out that rental continues to position itself in Spain as a highly demanded alternative, especially in large cities such as Madrid and Barcelona. In his opinion, uncertainty will continue to be present in the activity of foreign buyers.