The big unbalance between sales and rentals remains within the andorran real estate market in 2022
The Andorran real estate market persists with a big unbalance between sales and rentals.
On the one hand, the purchase of apartments maintains its upwards tendency with a very high level of sales, specially in the sector of high standing, despite the increase of the cost of raw materials that at first seemed to potentially tense the market. However, for the time being this upward tendency has not ceased and the data on sales are not only better than last year but are actually the best of the decade. The consistent arrival in the Principality of new investors and residents with high purchase power maintains a high level of sales and for this reason the vast offer of new apartments is fundamental for the market. Against this background, the offer of “second hand” apartments is very low due to the big amount of transactions that took place these last years. The few available units are at a high over cost vis à vis the new constructions.
On the other hand, the situation of the rental market is different and during the past years it has gotten more complicated. From a practical stand point, the entirety of apartments that are on the market are for sale and there are basically no apartments to rent. In addition, the prices are following a upward tendency, especially in the central Parishes. The few properties that are put on the market often present a price-quality ratio that is difficultly understandable. The real estate portals are a faithful indicator of this reality and the options of purchase represent a 67 to 1 ration vis à vis the rentals.
With respect to the touristic rentals, this sector has been impacted these last two years, due to the lack of tourism stemming from the Coronavirus pandemic, but it is now recuperating dynamism and is a very interesting option for investors. The result is that residential rentals and seasonal rentals lose units on the market and the owners prefer the touristic rental modality because this form of rental is not limited by the “freezing” of rent that took place during three consecutive years.
Augé Legal & Fiscal