Spanish house prices rise 12.2% in 49th straight quarter of gains

House prices rise 12.2% and notch up 49 straight quarters of gains: who is sustaining this climb?

How long will Spanish house prices keep rising? The data published by the INE (Spain's national statistics institute) on Monday offers no respite: the House Price Index recorded a 12.2% year-on-year increase in the second quarter. With this jump, the indicator has now logged 49 consecutive quarters of gains, a streak stretching over twelve years that shows no sign of running out of steam. The question is no longer whether prices are rising, but who is buying at these levels and how long the market can sustain this pace.

A price surge spreading across the whole country

The most revealing finding in the report is not the headline figure but its geographic spread. The tourist markets that led the increases after the pandemic, such as the Balearic and Canary Islands, have been caught up with and even overtaken by regions in the north and inland: Asturias, La Rioja, Castilla y León and Aragón. Rising prices are no longer concentrated in specific demand hotspots but have become generalised across practically the whole country. This debunks the narrative that the pressure comes only from big cities or tourism.

Clashing causes and interpretations

Explanations for this climb collide head-on. One school of thought points to demographic pressure: the arrival of millions of people in just a few years has created demand for housing that supply has failed to absorb, especially in small municipalities where prices have soared through a knock-on effect. A more sceptical reading holds that this is not a matter of supply and demand but a deliberate design of the system, in which house prices have become an instrument of economic policy. And some argue that weighted averages may be hiding weaknesses: in some areas prices are already falling sharply on property portals, and the third-quarter figure, due out in November, could reveal a less robust reality.

The figure that unsettles

Meanwhile, the average citizen watches their purchasing power fall short against prices that now rival Manhattan's, but with salaries that are a fraction of the kind earned there. The irony is that after more than a decade of uninterrupted increases, no one has found the brake. Perhaps the problem is not that prices cannot be stopped, but that no one wants to stop them.