House prices triple in the midst of a sales boom

BarcelonaHousing prices are already growing at rates more typical of a world without pandemic. According to data published Wednesday by the Spanish National Statistics Institute (INE), buying a home in Catalonia in June was 3.2% more expensive than a year ago and 2.5% more than three months earlier. All this coinciding with a period that several professional sectors involved in the real estate market have been celebrated as the best in sales in fourteen years.

As for the comparison with a year ago, the price increase triples the rate of three months earlier. In fact, no such year-on-year growth has been recorded since the first quarter of 2020, when the effect of the pandemic was barely noticeable on economic activity. Even then, the price index compiled by this statistical agency had been showing increasingly moderate price increases for seven quarters, and the trend did not begin to reverse until the end of last year.

In other words, in none of the quarters in which the pandemic has disrupted life in Catalonia have house prices been lower than they were a year ago, but price increases had been increasingly discreet for some time. However, between April and June this year the difference is two points higher than the same percentage recorded in the first quarter. And then, the increase was only two tenths of a percentage point.

Comparing the behaviour of prices from one quarter to another, the distance with what happened in previous periods is even more remarkable: a rise close to 2.5% between one quarter and another was not recorded since autumn 2018. Since then the rate has barely grown above 1% and even fell by 1.4% at the end of last year.

Despite everything, Catalonia is the eighth community with the most moderate quarter-on-quarter increase and remains only slightly above the Spanish average (2.4%). It also has nine communities ahead of it with more pronounced price increases compared with the same period last year.