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The Rental Home Market in Spain Continues to Rise

The gross yield on rental housing stood at 6.81% for multi-family properties and 5.61% for single-family units in Q1 2020, according to data collected by BrainsRe.

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Illustration by Juan Pablo González.

The average price of rental housing in Spain in the first quarter of 2020 amounted to 10.2 euros per square metre per month, which represents an all-time high despite the impact the coronavirus crisis may cause in the sector, and even though we were already 15 days into the pandemic by the end of March.

If we talk about monthly prices, the average rental cost stood at €1,097.70/month, according to data collected by the Brains RE big data real estate platform.

Those prices represent quarterly growth of 3.03% and inter-annual growth compared to the same quarter in 2019 of 5.15%. “The constant and high demand, combined with the lack of supply in certain areas of the country, is continuing to stimulate prices and make rental housing the star product of the real estate market. This is also evidenced by the number of ‘build-to-rent’ projects that have been launched over the last year and a half”, says Antonio Ramudo, Data Scientist at Brains RE.


Single-family homes are the most expensive product in the market for sale, and for rent. The first quarter ended with an average rental price of €1,765/month, whilst the average monthly rental price of multi-family homes was €1,007/month. Although, if we look at the average price per surface area, the cost per square metre of multi-family housing, at €11.20/m2/month, is considerably more expensive than that of single-family housing, at €7.50/m²/month.

With a 90% market share, multi-family housing is the predominant product, with 2 and 3-bedroom flats the most common size in this category – 58% of the homes for rent in Spain during the first quarter were 2 and 3 bedroom apartments.

The average flat on the rental market during the first quarter of 2020 measured 90 m² and had 2 or 3 bedrooms, whilst the average house measured 236 m² and had 3 or more bedrooms, details Ramudo.

1 bedroom flats, the most expensive

In terms of the prices of the different types of homes, the average monthly rent for a 1-bedroom flat in Spain has reached €800/month for the first time and is the most expensive of all of the types at €14.3/m²/month.

2-bedroom flats, by far the most abundant type on the market, have an average price of €934/month (€11.7/m²); 3-bedroom apartments cost €1,045/month (€10.1/m²) on average and 4-bedroom apartments cost €1,367/month (€9.9/m²).


In terms of yield, during the first quarter of 2020 in Spain, the gross yield of multi-family housing stood at 6.81%, whilst that of single-family housing amounted to 5.61%.

1-bedroom flats continued to be the most profitable product on the market with a gross yield of 7.94%, whilst large houses were the least profitable, with an average gross yield of 5.37% for 4-bedroom properties, according to data from Brains RE.

The yield at the national level has been increasing steadily quarter by quarter for the last 5 years, although – in the opinion of the Data Scientist – in those nuclei with a lot of investment activity, such as Madrid and Barcelona, ​​returns have actually contracted over the last three years.

Publication period

The average publication period of a rental property, which is the average length of time that a rental product is on the market before a tenant is found, during the 3 months to March this year in Spain was 1.8 months.

Multi-family housing is the most liquid product, since it can be rented in 1.7 months, whereas single-family homes are rented on average in 2.3 months. The bigger the house and the more bedrooms it has (and therefore the more expensive it is), the longer it takes to find a suitable tenant.

The average publication period of rental homes has decreased over the last 3 years thanks to growing demand and limited supply, “although it has shown some stagnation since the beginning of 2019. As such, we should not rule out that the possibility that, during the remainder of 2020, and after the coronavirus crisis, these periods may begin to expand”, explains Antonio Ramudo.

The structure of the rental market

12.3% of the properties on the housing market during the first three months of the year were for rent, whilst homes for sale, which have longer publication periods, accounted for 87.7% of the market. As such, this data confirms that the Spanish market continues to display imbalances typical of a business that is much more sales oriented.

And finally, if we analyse who manages the rental assets on the market, the Data Scientist estimates that the sector enjoys a high degree of professionalisation, with 79.3% of the products in the hands of real estate agents and only 20.7% of rental homes managed by private individuals.

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