Barcelona property attracts new wave of foreign investors

on Mar 23, 2015
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The financial crisis of 2007-08 hit the world hard, but in the following years, some countries have suffered more than others in their attempts to regain stability.

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One such country is Spain. The main issue behind Spain’s crisis was its overwhelming housing bubble, which had seen Spanish property prices rise by 200 percent from 1996 to 2007. Once the world sank into recession, Spain’s housing bubble popped sending the country into a downward spiral. According to Eurostat, between June 2007 and July 2008, Spain was the European country to suffer the sharpest fall in construction, with actual sales down an average 25.3 percent.
However, the country is slowly but surely starting to blossom again.
Over the years, Spain has generally attracted buyers to its southern coast. However, this all looks set to change, as more and more people are making a beeline for the country’s large cities. One such city seeing a new influx of investors is Barcelona. Properties there saw almost 40 percent cut from their value during the recession but foreign demand now seems to be spurring a rise in both prices and transactions.
“Barcelona’s growing charm as an urban beach resort, plus attractive house prices for a city of its calibre, help explain why foreigners now make up 50 per cent or more of demand in some central districts,” claims market-analyst Mark Stücklin of Spanish Property Insight.
One of the reasons that Barcelona has become so popular with buyers could be its vast diversity. From the old world Gothic quarter, where house prices are averaging out at around €4,500 per square metre, to the modern day Diagonal Mar area, featuring luxury apartments for prices of around €7,500 per square metre, Barcelona is not short of idealistic locations to invest in property. In fact, it is the Diagonal Mar district that has become especially popular with international investors due to its American-influenced design. However, while demand for housing in Barcelona is once again on the up, supply has not improved sufficiently to meet the voracity of the market.
This is also true for properties to let in Barcelona, with interest in the area growing every year for Diagonal Mar, according to HolidayLettings.co.uk. Guifre Homedes of Amat Luxury confirmed that his company has seen huge demand for rentals with customers from Russia, Switzerland, Belgium, North Africa and Britain leading the way. However, foreign clients have their own standards. So while there may be a vast amount of properties available for rent in the Eixample area of Barcelona, the quality of the offerings often prove to be unsuitable for many potential renters. Most people wanting to buy a property in this district are looking for a place with a price tag of between €500,000 and €1 million.
Overall, house prices in Barcelona are edging their way up every quarter according to property portal Kyero.com. The average property price in the city has risen to €627,000 and with transactions increasing by nine percent last year – the first rise since the financial crisis – Barcelona looks like it’s becoming the place to be for many international investors.

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