Alex Trelinski
PROPERTY prices in Alicante City rose by 18.2% in December over 12 months, while the stock of houses and flats for sale fell by 15%, according to property portal Idealista.
A fall in interest rates has triggered a boost in demand but with supply of housing unable to keep up, prices are climbing to record levels.
Some city districts like Carolinas, Altozano, Babel and La Florida saw annual price hikes of over 22%, which are prohibitive for many middle and low-income families looking to buy.
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Idealista said the average cost per m2 in Alicante last month was €2,275- climbing to above €3,100 in areas such as Cabo de las Huertas and Playa de San Juan- both coastal areas that are popular among foreign buyers.
Parts of the city centre reached €3,000 per m2.
The portal warns that the sales boom in the second half of 2024 has resulted in ‘the largest drop in supply ever seen in our country, with markets that are at minimum stock levels’.
Idealista spokesperson, Francisco Iñareta, said: “With low interest rates, demand will not fall over the coming months, which will then push up prices further.”
“Despite the political effort that institutions and parties have announced to accelerate the promotion of new homes, the reality of the market shows that the tension on prices will remain at least for the next few years, as long as it is not possible to provide sufficient supply to the market in those areas with greater demand,” he added.
