Spain

Overall construction activity

The Spanish economy continued to grow at a consistent pace throughout 2019, with a growth rate of 2%, lower than the 2.4% of the previous year. On the demand side, growth slowed down as a result of a lower than expected dynamic for most of its components, especially consumption and investment in capital goods. With regard to residential building, its growth rate is estimated to have eased, although it remains positive. For the foreign sector, a positive contribution to aggregate growth of 0.4 points has been confirmed, compared to the slightly negative contribution of the previous year. Job creation in 2019 reached an additional 452,000 people, an increase of 2.3% compared to the previous year. In the construction sector, 56,000 new jobs were created which represents a share of 12% of total job creation. This growth in employment is leading to labour shortages in certain geographical areas, especially in the construction sector. According to SEOPAN's estimates, the construction sector reached a production volume of €125.1 billion in 2019, 1.3% higher than in the previous year. In terms of added value, its share represents 5.9% of GDP.

Housebuilding

Activity in 2019 slowed down to an increase of 1.6%. After the intense crisis in the sector, 2015 marked the start of a substantial recovery, bringing the number of licences to 84,000 in 2019, compared to the lowest point of 36,000 in 2014. This growth signifies that the share of residential investment in the GDP currently amounts to 5.7%. With regards to the real estate market, it is worth noting its gradual moderation over the last year, with prices expected to continue to increase in those regions with a more dynamic demand and driven - on the coastal areas - by foreign investment. Based on estimates by the Bank of Spain, one can conclude that housing prices are not far from their equilibrium value and that the factors supporting housing demand are still solid.