Overseas Buyers 2024

The overseas property market in Spain definitely seems to have settled down after the boom years following the pandemic disruption. The recently released statistics for the 1st half of 2024 show continued upward trends in numbers at a level more in line with the growth rates of the immediate pre-pandemic years which was 1% - 3% annually. Across the board, prices are up in all the regions most associated with the international market, that is, the Mediterranean coasts, the Balearic and Canary Islands and the average spend of international buyers remains well above that of domestic buyers in terms of € per m².  However, as always, statistics on their own don’t mean much, it’s important to dig into them to find out more. 

At first glance, comparing the 1st half of 2024 with the 1st half of 2023 to get year-on-year fluctuations seems reasonable but in my view it makes more sense to do the comparison with full-year 2023 figures where possible. This makes it easier to assess if end-of-year 2023 trends in terms of buyer numbers and prices have continued into 2024. And although I have tended over the years to take the overseas market as a whole and not separate into resident and non-resident foreign buyers, when it comes to the differences between what the two groups pay these can be quite stark and worth highlighting. In addition, there are notable differences depending on the nationality and in a couple of cases almost all the buyers are resident with very low spend, much lower than the average for domestic buyers. 

Taking the overseas sector as a whole, it accounted for 20.4% of all property transactions in Spain, just down a tad from the 2023 full year figure of 20.9%. As ever, overseas buyers from the U.K. are the nationality league leaders, representing 8.45% of all international purchasers with a total of 5,864. In previous years I would have expected to report that the Germans were in second place followed by the French in third, or vice versa as they switched around on a regular basis but not any longer it seems. Moroccans filled the second spot with a 7.8% share of the market and 5,452 transactions, pushing the Germans down into third place, 6.8% market share with 4,710 purchases.  The French (3,939 6th) slipped out of the top three, to be replaced by Romanians (4,388 - 4th) and the Italians (4,332 - 5th). But these raw numbers don’t mean much on their own and looking at what the various nationalities spend produces a completely different league table.

Buyers from overseas have always spent more than domestic buyers. These 2024 figures show that in the first half of the year the average spend per square metre for domestic buyers was €1.659 while the average for foreign buyers was €2,249, 35% more. And the difference is even more marked if overseas buyers are separated into residents and non-residents; the average spend of a non-resident foreign buyer was €2,895, 74.5% higher than the domestic average. In the case of British buyers, who are far from the biggest spenders among overseas buyers, they spent 36% more than domestic buyers if taken as one group. However, if the British buyer is a resident then that difference falls to 16.8% while a non-resident British purchaser spent, on average, 50% above the national average for domestic buyers. 

The Big Spenders

Buyers from Sweden topped the spending league table, averaging €3,330 per m², approximately double the domestic average, with non-resident Swedes paying €3,454 per m². However, they lost that lead position when compared with non-resident buyers from the U.S. ( €3,621pm²), China (3,636 pm²) who, in turn, were obliterated by Venezuelan non-resident buyers on €6,807 pm². But before planning expensive marketing campaigns to attract more wealthy Venezuelans into the market take note that in the first six months of the year there were a grand total of 17 non-resident buyers from Venezuela. And the number of resident Venezuelans entering the market was only 796 and they spent 16.8% less than the domestic average. So, breaking this group down into resident and non-resident sections it turns out that while the 2% who were non-residents spent way more than everyone else in terms of price pm², obviously purchasing at the very top of the market, the 98% who were residents spent considerably less than Spanish buyers. It’s safe to assume that they weren’t buying in the traditional Mediterranean mainland coasts and island hotspots.

The Low Spenders

So what of the Moroccans, now the second most numerous in the nationality league table. Analysing these first half year figures we see only 1.9% were non-residents, a grand total of 109 and they spent on average €2,828 pm², very close to the average spend for all non-resident foreign buyers and 13.5% more than the average non-resident Brit. However, it’s the 98.1% resident Moroccans that really mess the figures up - their average spend pm² was just €685, less than half the average spend of Spanish buyers. And it’s the same confusion in respect of Chinese buyers. The 10.5% non-resident Chinese buyers outspent the Swedes, Germans and Americans, while the 89.5% who are residents were more or less in line with the domestic average. So by including a large number of buyers with an average spend so much lower than other buyers from outside Spain, the statistics are skewed but a bit of digging shows that it’s the non-resident purchasers from overseas who have the buying power to make a big difference to the Spanish property market. In addition, a wider range of nationalities are entering the market and making their presence felt both in terms of numbers and spending power.

Changing Trends

It’s interesting to look back at 2007 which is as far as the notary statistics in the current format go. Then the British were 37.3% of the 57,674 overseas property buyers in the full year. Today, their share of a market on track to equal or better 2023’s total of 131,388 is 8.45% but it’s not so much that the British market has collapsed in number terms, it’s more about other nationalities increasing the size of the cake. In 2007, German and US buyers totalled 1,003 and 330 respectively. In 2007, Poland didn’t even register as a separate country, they came under the ‘EU others’ group but in the first half of 2024 they experienced the biggest increase y-o-y in the nationality league, up 28.5%. So, while the cake is much bigger in 2024, it’s being cut into many more slices in terms of nationalities - Spain is now a truly global real estate market. Another trend that can be seen by looking back is how the balance is changing in respect of resident versus non-resident overseas buyers. In 2007, 77% of British buyers were non-resident, today that is down to 60% and from that I think we can deduce that more British buyers are living and working in Spain and more of the retirees are permanent residents. In contrast, 85% of the high-spending Swedes are classed as non-resident. Perhaps that will change over time.

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