CSN News reports that property prices in Spain rose 8.4% in the last year, which is the highest increase since 2007.

Last year, the price of houses in Spain soared to its highest level since the 2007 property boom.

The National Institute of Statistics, or INE, announced on Friday that the average growth rate for 2024 is 8.4% – double what it was in previous years.

The property market has now grown 11 years in a row.

The cost of new constructions has risen even more by 10.9%. They are now 85% higher than they were a decade earlier, and there is no indication that the trend will change.

In 2024, the price increases are due to a lack of homes available for purchase and lower mortgage rates.

Maria Matos is Director of Studies for the property portal Fotocasa He said: “Never before has the demand been so far away from supply.”

Matos said that the European Central Bank’s reduction of interest rates has made mortgages more attractive.

Matos’ comment on the larger rise in new-build prices was: “Developers are still having difficulty setting up their projects due to land shortages, high costs of construction and bureaucracy. This prevents supply to increase at a rate that is needed.”

The price increase was the same in all of Spain’s regions, but Navarre and Andalusia saw the biggest increases with 10.4%. Aragon followed with 10.2% and La Rioja with 9.9%.

Balearic Island had one of the moderatest increases (6.6%), indicating that some areas, especially those that are more reliant on tourism and have a saturated market are experiencing a slowdown.

Miguel Cardoso is chief economist at BBVA Research, said that ‘in some areas where housing almost unaffordable, demand is falling.”

The Balearics are a good example of this. Prices have risen so high that they can no longer be sustained by many buyers.