One distinct protagonist dominates the real estate market in the province of Alicante: the international buyer. More than half of all home transactions in Alicante are in the hands of foreigners, according to data from the recently launched Notary Statistical Portal.
This situation is not a problem; rather, it is “an economic strength from every perspective.”
The province’s appeal extends beyond conventional tourism. The market profile in Alicante is divided between 35.4% foreign residents and 19.9% non-residents, with international citizens accounting for 51% of property purchases.
Citizens of the Netherlands, the United Kingdom, and Belgium are the nationalities that are responsible for this phenomenon in the province of Alicante.
Nevertheless, this unyielding foreign demand is in direct opposition to a housing supply that has become exceedingly scarce.
This dynamic has resulted in a distinct real estate tension, with Alicante being the province with the most expensive square metre in the entire Valencian Community, with a price of 1,869 euros.
It will undoubtedly result in an increase in prices; however, in my view, the advantages outweigh the disadvantages.
The vice-dean emphasises that the genuine solution does not involve restricting the international market; rather, it involves increasing the supply by providing incentives to developers and promoting new public works by the administrations.
Transparency in opposition to speculative
The new Statistical Portal of the Notary Profession, an interactive, public, and free platform, has led to the revelation of all of these conclusions.
The notary platform, in contrast to conventional real estate portals that display sellers’ expectations or desires, publishes “the real data on which transactions are based,” which is extracted directly from official deeds. Consequently, the speculative factor is eliminated from real estate analysis.
“The Wall for Young People”
The scarcity of supply and the general increase in market prices have created a significant barrier to entry for young people.
The percentage of individuals under the age of 30 who participated in home purchases has decreased from 21.58% in 2007 to only 8.39% today, as indicated by data provided by notaries. The notary laments that the price and the delay in accessing the labour market are the barriers. He explains that young people are becoming more reliant on external aid and an avalanche of family donations that have multiplied exponentially in recent years in order to meet the 20% down payment required by banks.
A deluge of contributions
In this situation, what is frequently referred to as the “early distribution of inheritance” has become the primary source of sustenance for future generations.
The Valencian Community has experienced a quadrupling of monetary donations from parents to children, with an average quantity exceeding 75,000 euros, as indicated by the Notary Office’s figures.
The increase in the province of Alicante is particularly significant, with a jump from 844 to over 4,000 in the case of monetary donations.
Peral Bernat elucidates that this “exponential increase” is the result of a dual reality: the inescapable necessity to assist children in making the down payment on the apartment, as well as the present tax incentives, which permit exemptions of up to 100,000 euros.”You add the fact that there is a tax reduction for which the young man will pay little or nothing to the natural generosity of a father towards his son. This leads to many more transactions, as the young man will have a very difficult time accessing housing without the donation,” explains the vice dean.
Guarantees that are publicly available
Public guarantees are an alternative to donations, as they enable access to bank financing of up to 100%. The Government approved an ICO guarantee program in 2024 that was intended to cover the complete cost of a first home purchase for young individuals aged 35 and under.
Nevertheless, these guarantees are currently suspended until the formal renewal by the banking entities, despite the fact that the measure has been extended until the end of 2027.
The Valencian Institute of Finance (IVF) serves as the regional government’s guarantee. This guarantee also extends to individuals aged 45 and older, who are eligible to receive up to 100% of the financing for the acquisition of their first property.
