Foreign citizens signed 43% of the rental contracts that Amat Immobiliaris managed in Barcelona last year, as explained by its general director Guifré Homedes this morning: a percentage that has tripled from less than the 15% that they represented before the pandemic. Amat has experienced a similar process in Sant Cugat (16% of the contracts signed by foreigners) and Sant Just Desvern (9%).
For Homedes, this group of “digital nomads” reflects “the change that has occurred in the city, which has created a very favorable environment for startups and technology companies.”
“They are mainly small businessmen, who in their countries already worked from home, and who now do so from Barcelona. In our case, a large percentage are French, who maintain the company in France, and do not opt ??for a seasonal rental because they have the prospect of staying long term”.
This group is one of the factors that pushes rents up “because they have European salaries and pay prices that locals can no longer afford.” In his opinion, “a similar phenomenon is taking place in other cities such as Lisbon, with a good business environment, housing prices below European levels and a high quality of life.”
Amat stressed that the increase in foreign demand adds pressure to a rental market that is already stressed, since “the rise in rates makes it more difficult for young people to buy, so the rental flats do not rotate.” Both factors have increased the average age of the tenants, so that 50% are already over 40 years of age. And the supply continues to drop sharply, and in Amat it is at its lowest level in its 75-year history.
Homedes explained that his company signed 9% fewer contracts last year than the previous year, due to a lack of product. “The second semester of 2022 was the one in which we had the fewest available apartments in the last 5 years, and only the quarter of the confinement we had a lower offer” and this year “we only see worsening prospects”. The company rents homes from small owners, who have an average of 3.3 floors, and have doubled the homes in their portfolios that they put up for sale, in addition to not buying new ones.
“Sales to investors used to be 20% of our sales and now only 5%,” he said. “The owners fear that the law will change and lower the threshold of apartments that qualify them as large holders”, which is now 10 homes but that the new housing law wants to reduce to 5, so that “they no longer want to have more than three floors”. In this way, Amat expects to rent this year between 150 and 200 homes less than last year, “and we will be at half of what we used to rent a few years ago.”
The lack of supply, with a rising demand, has caused new price increases, which in the case of Amat has oscillated between stability in the district of Sant Andreu, Ciutat Vella and Les Corts and increases of 31% in Gràcia or del 20% in the Eixample. “The average rent of the contracts we sign already exceeds 1,200 euros / month in all offices,” he added.
In his opinion, market tensions can only be resolved by increasing the supply of rental flats, with public-private collaboration formulas, and promoting price drops with measures such as tax incentives for owners who rent below the market level. “The administrations do not have the money to build flats directly and it would take many years. But everything that seems to be raised goes in the opposite direction, ”he lamented.
