• Multifamily Market 2024 Outlook

    May, 2024

Spanish FY24 multifamily market is expected to be a booming sector, with great potential for investors and developers. The combination of a growing demand and trends towards both sustainable investments and the incorporation of advanced technologies in the Living sector ensures that this segment of the real estate market will continue to be an attractive option for players.

The sector has experienced sustained growth during recent years, consolidating its position as one of the most dynamic and attractive segments of the real estate. According to data provided by market brokers, this sector has accounted for 84% of total investment in living in FY23, a figure significantly higher than the 58% recorded in FY22.

During FY23, mutual funds maintained a predominant role in the Spanish multifamily market, leading 44% of investments. However, their share decreased compared to 63% in the previous year. On the other hand, there was a notable increase in investment by private investors, who now account for 38% of total investments in multifamily assets, almost tripling the 16% recorded in FY22.

Investors with the ability to deploy capital efficiently in FY24 will gain a competitive advantage, by benefiting from market opportunities before the expected recovery takes place. Furthermore, the operational resilience of this asset class is attracting interest from a growing number of investors seeking to diversify their portfolios by increasing their exposure to assets in the Living sector.

Global trends, such as urban population growth and the need for flexibility, together with the imbalance between housing supply and demand, will continue to drive investments in the Living sector. In addition, rising interest rates have led some investors to convert office assets to residential use.