Spanish property sales soar ahead of new year
Alicante, Costa Blanca Photo: A Montero C
New figures from the INE Show that the Spanish property market increased 20 per cent in October 2014 compared to the previous year, adding to the wave of positive reports from Spain of overseas property sales rising.
The figures follow an unexpected price drop, though, as Tinsa's data shows house prices plunged 6.3 per cent year-on-year in November 2013. The dip occurs after months of stabilising property values, with prices reporting their first increase in years in September.
Low prices have not been a deterrent to buyers from overseas, who have flocked to Spain this year to snap up affordable holiday homes. The prospect of further declines, though, even as the Spanish economy enjoys remaining out of recession, could be cause for concern among buyers.
“We’ll have to wait and see what happens over the next few months to find out if this is a short-term phenomenon or if it’s a sign that the economic recovery isn’t leading to an improvement in the purchasing power of potential buyers,” says Tinsa.
Certainly, domestic buyers are struggling to afford homes, notes Tinsa, with the new types of jobs offering fewer hours and lower salaries, which is not helping to boost demand. While the market waits for both local and international demand to return, foreign buyers continue to fuel the recovery.
The capital and large cities suffered the biggest price drops, while the Balearics and Canaries shows the best performance, with year-on-year decreases of 4 per cent.
The Canaries also enjoyed strong sales, with transactions surging 51 per cent. Sales also climbed by double-digits in Madrid and Barcelona, indicating that international interest remains strong, even with the slow bottoming out and stabilisation of prices.
"These figures bode well for the property market in prime areas of Spanish cities and the Coast in 2015," adds Spanish Property Insight.
Indeed, in November 2014, demand for Spanish property hit a record high on TheMoveChannel.com, with Spain now accounting for 1 in 10 of all enquiries on the site, overtaking America to become the most popular destination in the world.