By Corina Pons
MADRID (Reuters) – Deep-pocketed U.S. citizens paid the highest prices for Spanish property of all foreign buyers last year, while making the most purchases in some central and northern regions, data showed on Thursday, exacerbating a housing crisis in the country.
Unlike northern Europeans who have long sought refuge from harsher climates on Spain’s sunny beaches and plains, U.S. investors only started arriving en masse recently, some driven by business considerations such as a strong dollar, others by concerns over U.S. President Donald Trump’s populist policies.
The number of property deals involving Americans was more than four times higher than five years ago, during Trump’s first term, with their share doubling to 2% of the total 139,102 transactions by non-resident foreigners, based on statistics on property deals from Spain’s General Council of Notaries, which oversees property registries.
That was still well behind Britons, who remain the biggest foreign buyers although their share of house purchases dropped to 8.5% from 12% over the same period. The average price they paid per square metre was nearly 30% lower than the 3,390 euros ($3,732) paid by Americans.
Foreign buyers, who account for 20% of all residential purchases in Spain, on average paid 2,362 euros per square metre, while Spanish nationals paid 1,713 euros in the second half of the year.
While Spanish house prices are generally lower than in wealthier central and northern Europe, they jumped 11% last year, the second-biggest rise in the European Union after neighbouring Portugal, Eurostat data showed.
With a housing crisis already sparking protests against rising rents and property prices, the government has threatened to impose a tax of up to 100% on property purchases for non-EU buyers, although experts doubt it will stem price increases originating from a low supply of housing.
Spain has already scrapped its so-called “golden visa” scheme granting residency rights to foreigners making large property investments. Many Americans have taken advantage of the scheme in recent years but its demise is unlikely to stop them buying as long as they consider the prices attractive.
“Americans see that Madrid capital property prices still have a significant growth potential versus other European cities,” said Luis Valdes, director of Residential Sales Advisory at Colliers, citing Spain’s southern Costa del Sol as another example.
Francisco Cerezo, partner at U.S. law firm DLA Piper who does cross-border business in the region, said U.S. citizens of Latin American heritage were particularly keen on Spanish property, attracted by the familiar language and culture, as well as prices and climate.
“In that sense, it does evoke parallels to the investment patterns we’ve seen in Florida over the years,” he said.
($1 = 0.9083 euros)
(Reporting by Corina Pons, editing by Andrei Khalip, Kirsten Donovan)
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