The Rising House Prices in Alicante: A Look at the Trend

02.04.2024

In the spotlight of the Spanish real estate market is Alicante, a province experiencing a remarkable increase in house prices, even exceeding the national average. Recently, the square meter in this region has jumped by as much as 7.8%, which is almost double the average increase in the entire country. This growth is not only striking, but also has significant implications for both local residents and potential buyers.

The latest report from appraiser Tinsa confirms this upward trend, with Alicante even coming in fourth place in terms of house price increases over the past year. The value of the square meter ended the first quarter at 1,453 euros, a significant increase compared to the previous year. This increase is partly driven by the continued demand for second homes, especially in coastal areas, where the international market plays an important role.

However, there is a complex story behind these figures. While tourist areas are experiencing steady growth, especially from buyers with higher purchasing power who are less affected by inflation and interest rates, the situation in domestic regions remains different. Here, demand mainly depends on local buyers, and rising house prices have a noticeable impact on their finances. Growth is therefore considerably less in these areas.

It will be interesting to see how this trend translates to individual cities within the province of Alicante. Orihuela, for example, has seen a notable increase of 11.3%, while cities such as Elche and Alicante have also seen significant increases themselves. These increases make it increasingly challenging for local residents to find affordable housing, and they could impact the social dynamics and economic stability of these regions.

The situation inland, where growth is less pronounced, shows the divide between different parts of the province. Although towns such as Alcoy and Elda have also seen an increase, it is significantly less than that in coastal areas.

Looking ahead, it remains essential to keep a close eye on these trends. Increasing pressure on housing affordability can lead to social tensions and economic uncertainty. It is critical that policymakers, real estate professionals and community leaders work together to find solutions that secure access to affordable housing and promote the region's stability, both coastal and inland.