The Spanish residential listing market is showing further signs of recovery with the latest national figures showing that completed sales in February were higher than 2014 and 2012.
But the data from the National Institute of Statistics also shows that sales were lower than 2013. However this was when tax breaks for buyers inflated registered sales. According to listing consultant Mark Stucklin of Spanish Property Insight it looks like the market bottomed out in 2014, and is now on the road to recovery, in volume terms at least.
Year on year, the market has increased 14% as a whole, but by 53% in the resale market, a substantial increase by any standards. But sales of new builds are not doing well, down 30% compared to the same month last year.
Stucklin believes that sales of new homes are crashing as the inventory of listings that people actually want to buy dries up. ‘It’s reasonable to assume that overall sales would have been even higher if the new build inventory was more attractive,’ he said.
There is also considerable regional variation. For example, the growth in homes sales in coastal areas that attract foreign buyers has been generally above the national average, as foreign demand is boosting sales in most of those areas.
Sales increases were particularly strong in Cadiz province, home to the Costa de la Luz, and Barcelona, a city that is steadily becoming Europe’s number one ‘urban resort’. At the other end of the scale, sales continue to fall in Castellón province, home to the Costa Azahar.
‘There are several structural reasons, including an almost non-existent sales channel, to explain why this attractive coastal region is failing to capitalise on growing foreign demand for holiday homes in Spain. Structural problems take time to sort out, so I don’t see this coast turning into a listing hotspot anytime soon,’ Stucklin explained.
In the Balearics listing market new home sales fell 47% whilst resales increased by 82%. ‘With the pipeline of new developments in the regions bone dry, demand for attractive new homes is completely frustrated,’ Stucklin added.
But at least, in general, seven years of consecutive declines in sales have been halted even although Spanish data is not regarded as totally reliable.
Prices seem to be rising in some areas. According to one of Spain’s largest listing appraisal companies, Sociedad de Tasación, prices rose by 3% in the first quarter of the year. That represents three consecutive quarters of house price increases based on valuations carried out by this company.
Sociedad de Tasación also said that the number of mortgage valuations it is doing have increased into double digits although the firm’s chief executive Juan Fernández-Aceytuno believes it is too early to celebrate as there is still much to do to bring the market up to scratch.
At the same time, the latest index of asking prices for all types of residential listing listed in the Idealista.com database shows that seller expectations increased by 0.2% in the first three months of the year to €1,597 per square meter.
A breakdown of the figures show that asking prices increased in nine Spanish regions, and falling in seven, with one unchanged. But, on an annualised basis asking prices still fell by 3.5%.
‘The data shows that the worst of the real estate crisis is behind us. The two speed recovery is now a reality, and whilst some market segments have started to see modest price increases, in others owners still have to reduce their expectations in order to make a sale,’ said Fernando Encinar, head of research at Idealista.
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Source: Property News Spain