The tide is turning for the Spanish property market
Since the economy crashed in 2008, the property market in Spain struggled but a new report suggests that it could be improving.
There was an increase in residential sales of 33% during 2015 which is a sign that things are on the up. After the turn of the century, the economy in Spain was growing and the housing market played a large part in this as many British buyers moved there in search of a new life. However, recent years has seen a change in the market as it struggled along with the rest of the economy. Excessive housebuilding, over supply and the economic downturn all played a part in the decrease in property prices.
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It is looking extremely promising at the moment as Spanish buyers are up by 86% year-on-year and this shows that the property market is making a steady recovery. During 2015, local buyers were active and this was seen in the mid-end of the market as property prices reached an eight-year low. To add to this the economy began its recovery and the banks started to lend again. For many years, the market was full of international purchasers and even though this investment still forms a large part of the sales the number of transactions involving locals is on the rise. This is expected to continue throughout 2016.
It looks as though overseas investors are now looking to purchase property for sale in Spain once again as this is partly down to the good exchange rate. This has seen transactions involving British purchasers increasing by 50% in Barcelona year-on-year.
However, the sales were not limited to just British buyers because transactions involving Spanish buyers increased in Valencia. Increases were also seen in Maresme which is a coastal area located north of Barcelona. In the Costa Brava, Spanish buyers made up 29% of home purchases while they accounted for 37% in Maresme.
During 2015, transactions were officially higher in Barcelona when compared with 2014. The average in Barcelona was 2.667 per month which is a rise of 19% from 2014.
There were price increases witnessed across all regions in Spain during 2015 when compared to 2014. Madrid increased by 4% and Barcelona increased by 6% but Ibiza excelled as the price of property rose by 23% which is double the figure for 2014.
However, these figures can be misleading because consideration has to be given to the fact that many of the official statistics are based around the actual asking prices. House prices have not increase year-on year and some sales can see prices paid that are less than the actual asking price but things are slowly changing. In many of the prime regions, the average price of property is forced upwards by the sale of new properties which can often sell for as much as 30% more than re-sale homes. This kind of demand is now rising beyond the supply.