Spain is now among the world’s top 10 countries for real estate investment, according to a new report by Ernst & Young.
As the Spanish summer heatwave continues, so too does the growing optimism surrounding its real estate market.
The Real Estate, Hospitality and Construction Capital Confidence Barometer report revealed Spain climbed seven places to be ranked ninth among the top countries of greatest interest to investors looking to make an acquisition in the upcoming months – above destinations such as France and Italy.
The report is backed up by growing demand from investors. The latest figures from the National Statistics Institute (INE) show that residential property sales increased by 23.6 per cent in May this year – the highest numbers recorded since January 2013.
Marc Pritchard, Sales & Marketing Director for leading Spanish homebuilder Taylor Wimpey España, joins those who are confident in the future of Spanish real estate.
“Momentum is definitely building within the Spanish property sector and I think we can say that this season, in all terms, is looking to be one of the best in many years, if not the best ever for Spain and the Islands,” he comments.
He comments, as Taylor Wimpey Espana’s launches the sea front development, Panorama Mar, situated on Punta Prima Beach close to the beautiful town of Torrevieja.
Spanish property set for golden five years
25th July 2016
This year is the best time to buy a property in Spain, according to one expert, who predicts that the market is on the threshold of a golden five years of growth.
The country’s house prices have shown signs of increasing in the last year, following several years of declining values, in the wake of the global financial crisis. The economy is also growing again, helping to bring to stability to the real estate sector.
As a result, Gonzalo Bernardos, economics professor and director of real estate at the University of Barcelona, has predicted that we are “on the threshold of the best time to buy a home in Spain”.
Five “marvellous” years are on the cards, he wrote in the latest issue of La Vanguardia.
“2016 is a year of real estate expansion in which the trend of every asset is towards price increases,” he said.
The secret, Bernardos explained, is the country’s low interest rates, which make property an extremely attractive investment.
“The residential market is once again a refuge and the key to everything is low interest rates,” he added. Indeed, low rates have left mortgage repayments “substantially” below rental payments, which means that it is now cheaper to buy a property than rent it out – the perfect conditions to attract both homebuyers wanting to get on the housing ladder and investors looking to capitalise on long-term growth.
“After the dangerous decade (2006 – 2015) will come five marvellous years (2016-2020),” he added, saying that economic growth of 3 per cent will “finish off the hangover and carry the real estate market to a new period of growth”.
His comments arrive as Ernst & Young rank Spain the ninth best country in the world for invetors looking to make acquisitions within the real estate and construction sectors, climbing seven places in the rankings to overtake such destinations as France, Italy and Cyprus. Spain sits in the rankings behind only the USA, UK, India, China, Canada, the UAE, Germany and Sweden.
Madrid was similarly ranked the fourth best city in Europe for investment prospects in 2016 by PwC, behind only Berlin, Hamburg and Dublin. Barcelona was ranked 12th.
Bernardos’ forecast also arrive as the country’s construction industry continues to post positive improvement, albeit gradual, and as prices climb in popular hotspots, such as the sunny Costas and Barcelona.
Bernardos highlighted Barcelona in particular, forecasting 18 per cent house price growth in the city, above his anticipated national average of 12 per cent.
While domestic buyers will return in greater numbers, though, foreign investors will still be important in the city’s prime market, where he predicted they will lead activity until 2018, “with a second wave of crazed international demand pushing prices up as much as 25 per cent in Sarria Sant Gervasi, Eixample, Ciutat Vella and Les Corts”.
The report follows demand for Spanish real estate on TheMoveChannel.com rising to a 10-month high in June 2016.
“The country’s economy has been steadily growing each quarter since Q3 2015, with property prices also having bottomed out in key areas. Even with the pound weakening in the wake of the Brexit vote, the euro has weakened too, meaning that property remains good value for buyers in the UK and elsewhere, boosted by mortgage rates at their current lows,” commented Dan Johnson, Director of TheMoveChannel.com.
“In fact, Spain’s share of activity in June 2016 was its highest since July 2013, when it accounted for 30 per cent of activity on TheMoveChannel.com. Demand is below that peak, but is higher than 2015’s best months, when Spain recorded 11.99 per cent and 11.25 per cent of enquiries respectively. The country remains attractive for EU and non-EU buyers alike.”Google+