Spanish real estate prices have risen 3.5% in 2016, making it the strongest year-on-year growth in the index, according to data from Spain’s National Statistics Office.
The index measures the value of all property in the country and is published every three months.
Real estate in Spain was up 6.5%, from 1,547.8 million euros ($2.4 billion) in 2015 to 1,579.3 million euros in 2016.
Spain is a major exporter of real estate and the country’s property market is the envy of many countries.
“It’s a sign of strength for Spain, but also of a possible slowdown in housing demand in the next few years,” said Alex de la Torre, chief economist at Capital Economics.
With the population expected to swell to 6.7 million in 2020 from 6.3 in 2020, Spain will need to slow the pace of building and to reduce its reliance on foreign investors, he added.
In recent years, Spanish realtors have started to move to other countries, especially China, where prices have been rising rapidly.
Meanwhile, many Spaniards are worried about a lack of affordable housing, and demand for housing is expected to peak by 2026, according a survey by the National Statistics Institute.
A recent survey showed the number of homes sold in Spain increased by just 2.4% in 2017.
(FRANCE 24 with REUTERS, AFP, AP) (Reporting by Jose Manuel Gómez and Ana Paula Galdón; Editing by Sandra Maler)