Housing market in Spain: targets for 2024

Last December 2023, the European Commission published the report “Alert mechanisms for 2024”, in which it outlined its objectives for the real estate sector and how they would affect our country.

Are you interested in knowing what will be the most significant changes that will mark Real Estate this year? Read on!

The European Union’s plans for housing in 2024

Currently, the housing market in Europe is going through significant transformations, mainly due to two key factors:

• The European Central Bank (ECB) has raised interest rates with the aim of controlling inflation in the Eurozone and, as a result, banks across Europe have implemented tighter mortgage conditions.

• The Euribor has continued its upward trend. It even surpassed 4% in July 2023, its highest level in almost fifteen years.

These changes have had an impact on all European Union countries. Among them, Spain, where the first Housing Law was passed in 2023, which generated a drastic change in the real estate market.

For this reason, influenced by several variables and the specific real estate policies of each region, the European Union detailed in its report seven measures that are expected to be applied throughout 2024:

1. Maintain interest rates

The ECB is expected to maintain current interest rates to control inflation. In fact, the president of the institution, Christine Lagarde, stressed that no change is anticipated in the short term.

2. Increasing rental subsidies

The EU aims to increase rental support, especially for vulnerable groups. This is expected to be achieved by encouraging member states to provide assistance to their citizens through the European Funds.

3. Encouraging young people’s independence

Although the average age of emancipation in Europe is 26.5 years old, in places like Spain it is close to 30 years. There are plans to improve this situation through the implementation of policies and aid in all countries.

4. Promoting energy renovation

The European Union remains focused on promoting the energy renovation of buildings, not only for 2024, but also in the coming years. This will be achieved through aid granted to all member states, such as Spain.

5. Boosting rural areas and combating population aging

Boosting rural areas and combating aging and population decline is part of the EU Rural Action Plan. It is a long-term goal, but the aim is that by 2040, all rural areas will be stronger, connected, resilient and prosperous.

6. Advocate for buildings constructed with recycled materials

The European Union aims for both new buildings and renovations to be 50% composed of recycled materials or materials from renewable sources. It will also strive to reduce CO₂ emissions by at least 55% by 2030.

7. Continue to offer Next Generation funds

To address the impacts of COVID, the EU approved Next Generation funds, which allocated member states a total of €11.151 billion. Many of these funds are earmarked for the energy rehabilitation and improvement of housing.

In short, these measures aim to improve the current situation in the real estate market in our country. In KM2 Real Estate Services we will be attentive to possible developments that may arise to keep you up to date.

Of course, if you need guidance in any matter related to the real estate market, you are in the right place. Our extensive experience of more than 41 years in the sector allows us to assist you in all aspects.

Do not hesitate to contact our team of professionals in our real estate agencies in Barcelona or Madrid, we are waiting for you!