International retiree migration and housing markets. Evidence from Spain
Journal of European Real Estate Research
ISSN: 1753-9269
Article publication date: 27 September 2023
Issue publication date: 11 October 2023
Abstract
Purpose
Large numbers of Northern European retirees have migrated to Southern European countries. A relevant part of this migration is not driven by work purposes but rather the desire to establish residence in a warmer country. These migrants come from different countries and exhibit diverse socioeconomic characteristics and preferences, including varying income levels, housing tastes and cultural habits, which could potentially influence the housing market in their host countries. This paper aims to examine the permanent impact of retiree migrant flows on house prices in Alicante, Spain, from 1988 to 2019, explicitly considering the impact related to the country of origin.
Design/methodology/approach
This paper examines the permanent impact of retiree migrant flows on house prices in Alicante, Spain, from 1988 to 2019, explicitly considering the impact related to the country of origin using panel cointegration – Dynamic Ordinary Least Squared (DOLS) models.
Findings
Results indicate that the long-term relationship captures the entire effect on house price change and that prices react immediately to the immigrants' presence with permanent effects. The results also suggest that the strong retiree migration flow created a shock in the housing market with different effects on house prices related to the immigrants' country of origin. The model identifies that when income growth in the origin country is slower than in Spain it has a major impact on house prices. When purchasing capacity is larger in Alicante than in the origin country it exerts a stronger effect on housing prices. Retiree migration flow has permanent effect on housing market prices.
Practical implications
Results indicate several ways to act on social and housing policies in specific cities in Alicante province, as well as in the origin countries, to alleviate potential disadvantages faced by expatriate retirees.
Originality/value
This paper finds evidence of the specific impact of international retiree migrants on the hosting housing market. This study is the first paper that can estimate the specific effect on housing prices from a flow of retiree migrants by country of origin.
Keywords
Acknowledgements
The authors thank two anonymous referees and the Editor for the useful comments made to our article, which have substantially improved the latter version.
Citation
Taltavull de La Paz, P. and Gibler, K.M. (2023), "International retiree migration and housing markets. Evidence from Spain", Journal of European Real Estate Research, Vol. 16 No. 2, pp. 271-296. https://doi.org/10.1108/JERER-04-2023-0014
Publisher
:Emerald Publishing Limited
Copyright © 2023, Emerald Publishing Limited