« »

Friday, May 23, 2014

Spanish property sales up 26 percent

By Bradley Shore

Sales in the Spanish property market grew 26 per cent in the one year period from March 2013, the National Institute of Statistics has announced. 

Spanish real estate sales
 Coastal areas in Spain saw the highest real estate price rises
The highest gains were coastal areas where an influx of foreign buyers purchasing holiday and retirement homes has seen resales up by 36 per cent and new sales up 7 per cent. These figures are partly due to the government altering the tax code per cent, according to property guru Mark Stucklin from Spanish Property Insight.

 In an interview with propertywire.com, Stucklin says that “This dramatic rise in Spanish home sales can be partly explained by tax changes, which have been playing havoc with Spain’s property market statistics in recent months. The elimination of tax breaks for mortgage borrowers at the end of 2012 artificially inflated the depressed sales statistics both at the time, and now that the year on year numbers are out”.

He goes on to explain that this is why there has been so much contradictory news in recent months with figures showing sales both rising and falling at the same time. However, he thinks that these distortions on Spanish real estate sales should now begin to ease off and true values will become clear.

“Fiscal distortions apart, the Spanish property market increasingly looks like it has bottomed out between 20,000 and 25,000 homes sales a month. With 24,377 sales in March the market was up 5 per cent on a monthly basis, and the highest for two years, up 10 per cent on March 2012. So the underlying trend looks like a depressed market finally showing signs of stability, though no recovery outside of coastal areas and big cities” he explained.

Whilst the figures in the National Institute of Statistics are indeed not a true reflection of the Spanish property market, things are still looking up for the depressed housing market. With house prices set to begin rising again before the end of 2015, now would be a good time to invest in Spanish property as prices are at or close to, rock bottom with a resurgent rise just around the corner.

Ron Wilkinson, a Spanish property expert from Alta Vista Property says that there has been a surge in new sales, although not as much as the report suggests. “We have experienced a significant surge in the number of property sales to foreign buyers, particularly from Asia and the Middle East. Whilst we expect these figures to continue rising, there is some concern regarding domestic buyers. There has been a slight drop in sales to Spanish citizens this year, and this can be attributed in part to the continued rise in unemployment and the seemingly never ending recession”

Wilkinson believes that there is still reason to be optimistic however, “Experts keep saying that a turnaround is close, and it would be foolish to disregard their advice. At the end of the day, the fall in prices is slowing, and the number of buyers and investors is rising. If those aren’t positive signs, I don’t know what is. Hopefully things will begin to pick up speed towards the end of the year and we will be able to get back to the healthy market that many in Spain were used to before the crash”.

About the author: Bradley Shore is an experienced travel and property investment blogger who writes for a number of clients. He has been travelling an writing ever since leaving university, he would one day like to run his own blog but until then is sticking to freelance writing.

Image license: Tomas Fano; CC BY-SA 2.0