Prime property prices in Madrid are now 46 per cent higher than they were at their lowest point in 2012.
According to the latest industry report conducted by Knight Frank, prime property prices in Spain’s capital increased by 8.1 per cent in 2018, with high-end properties now being sold for €8,000 per square meter.
The figures show that some 85,169 residential units were sold across Madrid in 2018, up 61 per cent since 2014, while 35 per cent of all Knight Frank prime buyers in the city were from overseas last year.
The recovery of Madrid’s prime residential market gathered pace at the end of 2016 and since early 2017 Knight Frank’s unique Madrid Prime Residential Index has outperformed its 43-city average.
“In Madrid, the upturn in the commercial sector was a precursor to the residential market’s recovery,” explained Carlos Zamora, head of Knight Frank’s residential team in Madrid. “According to the Ministry of Economy, six out of every €10 invested in Spain is invested in the capital.”
Traditionally, Madrid’s prime markets were located across the city’s northern districts such as Salamanca, Chamberi, Chamartin and El Viso. However, since 2016, more attention has been paid to central areas including Sol, Embajadores and Plaza Mayor.
In terms of buyer motives, around 50 per cent of prime buyers are seeking a permanent or second home exclusively for their own personal use, 22 per cent are looking purely for a rental investment and the remaining 28 per cent cite a mix of reasons; such as holiday home, rental investment and a base for their child whilst at university.
Around 65 per cent of prime buyers in the city originate from within Spain, either from within Madrid or from its major cities including Barcelona, Malaga and Seville. A decade ago, this figure would have been closer to 90 per cent.
Article published 24th May 2019