Real estate demand could fall by up to 20% in Spain due to inflation and war

The effective real estate demand could fall between 15% and 20% due to the macroeconomic uncertainty derived from the war in Ukraine and the more expensive supply in the market, due to the tightening of the conditions of the entities and the drastic rise in the Euribor, according to Donpiso.

Thus, according to the deputy director general of Donpiso, Emiliano Bermúdez, housing prices will continue to rise in the second part of the year in the main Spanish cities. In addition, in the case of buying to later rent, “success is guaranteed”, since there is a “notable” differential in price and demand is “high”. On this matter, from Donpiso they have calculated that the profitability is between 5% and 7% per year, beyond the revaluation of the asset during that time due to inflation.

However, Bermúdez has pointed out that in the event of making this investment for the subsequent sale of the home, it must be taken into account that the sales periods are increasing due to the rise in mortgage prices, and can go from 90 days on average to 120 days after the summer.