Selection of relevant news on the real estate market in Spain – September
We are pleased to send you information about news published in different media on real estate investments in Spain. We hope you find it interesting. We’ll be glad to help you analyze how this information can generate opportunities for your next investment.
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Luxury home sales rise by 46.5%
Luxury home sales increased 46.5% in Spain during the first six months of the year 2017 compared to the same period in 2016, according to data provided by Lucas Fox, a real estate agency specialized in premium property. In alignment with this increase, the value of the transactions performed has risen by 54% and the average sale price of housing units has reached the amount of 750,000 euros.
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Mortgage conditions are changing: these ones will be applied by banks this Autumn
Spanish banks are focusing on mortgages. In a market with interest rates historically low and little margin to increase their benefits, mortgage loans have become one of the few profitable business operations for the financial sector.
Some strategy change has been produced in the recent months which must be carefully considered by anyone who needs to obtain a mortgage loan.
As explained by Juan Villén, head of Idealista hipotecas, “it is not enough to get funding in a rising market and that the client has sufficient income to afford each mortgage payment, but it is also important to be aware of the changes that are taking place on mortgages and conditions required by banks. Almost all of them have been revised”.
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The SOCIMI (REIT) of Mazabi family office gets 29 million to acquire more real estate
Silicius, the SOCIMI of Mazabi family office, has obtained 29 million euros funding to accelerate the acquisition of real property for an amount of 44 million euros before the end of the year. This socimi is aimed to go public next year with a value between 250 and 300 million euros.
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The real estate investment in Spain is already reaching out the total volume of 2016
The volume of investment in homes, offices, retail, logistics and hotels has closed the third quarter of the year at approximately 8,700 million euros, which represents a 40% increment compared to the same period of the previous year, according to data furnished by JLL consulting company. In addition, this figure already accounts for 91% of the total investment of the year 2016, which reached the amount of 9,564 million euros.
“The market is experiencing an excellent moment and there is reason to believe that all the business segments will improve their investment volume compared to 2016, allowing us to reach a historic investment record at the end of the year”, as explained by Borja Ortega, director of Capital Markets at JLL.
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Quabit gets a line of credit for up to 40 million to acquire residential land
This line of credit is aimed to purchase certain residential lands which have been recently acquired. The agreement also includes the possibility of creating a joint association with up to 25% participation by Avenue and controlled by Quabit (majority-owned), through which such acquisition of lands will be implemented. Specifically, the plots located in Málaga (Mijas), Baleares and Corredor del Henares, with a total construction capacity of 269.394 square meters to develop 1,922 housing units and worth 72.12 million euros.
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Homes go up 20.6% in Barcelona and 15.5% in Madrid in the third quarter
The Community of Madrid has recorded an inter-annual increment of 13.2% in the quarter, while Cataluña went up by 12.5%. Both regions have been the communities with the highest increase in average values during the last 12 months.
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Home values recovered 4% in the third quarter
The average price of finished homes (new and second-hand units) recorded a 4% increment during the third quarter of the year compared to the previous year, reaching 1258 euros per square meter, according to the Spanish Real Estate Market Index (IMIE) of Tinsa, a company that prepares statistics based on appraisals of units conducted by surveyors. Homes, with Madrid and Barcelona as the most active markets, emphasized their positive evolution during the third quarter, after the second quarter of the year experiencing an inter-annual 2.7% increment and 1.8% increase in the first quarter.
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The cement of the investment ”boom”
Fever is not diminishing. Spurred by ultra-frozen interest rates, the foreign investment in the real estate market was already exceeding, by midyear, all investments made in 2016.
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The Spanish real estate sector is rising from the ashes
The Spanish construction market seems to have turned the page. According to the Idealista real estate portal, home prices dropped 35.2% between 2007 and 2015 but they went up 2% last year and 3% this year. Analysts believe that this tendency will go on as long as the Spanish economy continues to grow 3% annually – one of the most solid data in the Eurozone.
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The acquisition of homes has reached peak levels since 2010
Out of all closed operations, 90.6% (128,833) involved second-hand homes; and the remaining 9.4% (12,749) were brand-new property. In both cases, there has been an increase on a year-on-year basis. The second-hand home segment recorded a 15.7% increment and brand-new homes recorded an increase of 4.9%.
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Ibosa and Green Oak Fund invest 86 million in a luxury residential tower in Madrid
Ibosa real estate group and Green Oak Fund are promoting a luxury 23-storey residential tower in the North of Madrid whose construction process will start at the beginning of 2018 and will involve an investment of 86 million euros.
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BBVA estimates a 4% increase in the price of their assets in the real estate market in 2017
The Finance Director of BBVA, Jaime Sáenz, has pointed out that during the recent years the real estate market and its prices “have been behaving properly”. Furthermore, he highlights that foreign investors are being increasingly attracted by the Spanish real estate sector, though, he said, unlike bank loans, real estate assets involve an important cost due to the administration expenses involved. On the other hand, he points out how important it is to keep the current economic growth which is enabling the creation of half a million jobs yearly.
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Signing of mortgages soared 32.9% in July
The number of loans taken on for the acquisition of homes climbed up 32.9% in July compared to the same month of the previous year. The financial institutions granted a total of 24,863 mortgage loans to afford housing units, as informed by the National Institute of Statistics (INE). Thus, the market has experienced three consecutive positive months after the decline suffered in April.
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Calculations made by buyers of luxury units to get 20% profit
Luxury housing units are at their best, just like a significant part of the national residential market. Prices have soared more than 10% in the last year and they will go up 5% annually in the next four or five years, as estimated by Knight Frank, after noting how second-hand single-storey apartments have increased 5% and 4% respectively in one year in Chambery and Justicia districts.
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Real estate investment grows 60% reaching new record figures
The acquisition of non-residential real estate soared to 7,061 million euros during the first eight months, therefore, it can be expected that the closing of 2017 will reach figures higher than those obtained in the previous fiscal year.
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The price of rented units rises 10% in August, as informed by Fotocasa
Specifically, the inter-annual variation recorded this month (10%) is the third highest one recorded in 2017, after a 10.5% increase in May and 10.2% in April. On a monthly basis, the price of rented units went down 0.1% in August, reaching 9.07 euros per square meter per month. This is the third consecutive drop recorded on a monthly basis.
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Real estate companies in the Community of Madrid increase by almost 5,000 in 2014
The signs of real estate renewed strength in the Community of Madrid is unquestionable: 41,641 housing units have been acquired so far in 2017, 17% more than last year and 30% more than two years ago, this being the highest figure obtained in the last decade; sale prices have increased 10.9% during the second quarter in 2017 compared to the previous year and rentals, which in spite of some curbs in their unstoppable rise, are 11% higher than 12 months ago, as informed by the Idealista.com, a specialized portal.
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The kings of the construction business will build thousands of homes in Spain
New real estate developers are emerging fueled by investment funds in a sector that is recovering from a crisis. The new generation developers are working hard to become leaders through the implementation of ambitious investment plans. They claim that their objective is to start building thousands of homes in the next years. “The sector is undergoing a clear transformation in terms of institutionalization and industrialization”, as expressed by Juan Velayos, representative of Neinor Homes. “We want to be seen as a factory of homes”, he adds.
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Free market housing price increases 5.6% in the second quarter, as informed by INE
Based on the type of housing involved, the average price of second-hand homes increased half a point reaching 5.8% in the second quarter, the highest rate since the first quarter of 2016. Regarding brand new housing units, price was incremented 4.4% on average in the same period, more than one point lower than the previous quarter.
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Homes sale went up by 16.8% in July
In the first seven months of the year, 274,513 houses changed their owners, very far from the 436,367 units sold in the same period in 2007.
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BBVA made 2500 homes available for sale under 50,000 euros
Anida, BBVA real estate company, launched a campaign involving 2,500 homes under 50,000 euros throughout the country, mainly in the cities of Valencia (357 units), Tarragona (227), Barcelona (214), Lérida (205) and Murcia (198). The units involved in this new campaign include all types of homes, such as units in multifamily buildings, single-family homes which can be attached and semi-detached and individual houses as well.
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Homes increase 5.6% in the second quarter due to the rise in Madrid and Cataluña
The increment in April-June period is the highest growth rate since the first quarter of 2016, when free market housing went up 6.3%. But this rise is also a consequence of the increase recorded in Madrid (10.9%) and Cataluña (9.3%), the regions where housing values get higher. The market seems to have left behind the years of two-digit decline in prices.
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Málaga records almost 25% increment in the sale of houses in 2017
In the first quarter of 2017, the province of Málaga recorded a 24.75% increment in the sale of housing units compared to the same period in the year 2016, as shown by the statistics informed by the Ministry of Public Works. Furthermore, out of the 7,676 units sold between January and March in 2017, a total of 6,175 are located in coastline districts in Costa del Sol Occidental, thus exceeding the 80% of the total of operations recorded.
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BBVA points out the “good conditions” of the real estate market in the first 6-month period
Based on information provided by the General Council of Notaries, during the first 6 months of the year, almost 265,000 homes were sold, accounting for an inter-annual increment of 15.5% “thanks to a good development of the economy and low financing costs”. Thus, a “positive” six-month period is closed which consolidates the growth tendency; and progress has been made in alignment with estimates of 500,000 homes sold in the entire year, as informed by the Observatorio Inmobiliario in Spain, prepared by BBVA Research.
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The sale of second-hand homes gets back to conditions prior to bubble burst
In the second quarter of 2017, a number of 119,408 apartments and property changed owners. Out of such total number, 99,343 were used homes. Used property has thus reached its peak level in almost ten years and by the end of June, the sale of second-hand property gets back to the same level that had been reached in 2007, before the real estate bubble burst.
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The average price of luxury homes in Spain climbs up 7% until June
The average price of luxury homes in Spain climbs up 7% until June. The average price of luxury homes in Spain increased 7% on a year-on-year basis during the first semester of the year reaching 6,500 euros per square meter, according to a report prepared by Barnes, a French group involved in the sales and rental of property. In cities such as Barcelona and Madrid, as well as in Catalan Costa Brava, Costa del Sol in Andalucía, Valencian Coast and Baleares Islands, the increase in the price of luxury housing units was higher than 10% on a year-on-year basis until June.
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A skyline littered with cranes in Madrid, a sign of real estate recovery
The construction sector in Spain is still recovering after 96% decline suffered by homes under construction process, from maximum values in 2006 to their minimum levels in 2013, as a consequence of the real estate burst and bank crisis. All in all, the sector will grow about 4% annually until 2020, according to estimations made by the Government. “It shows a positive trend and it means that the finished projects are quickly replaced by new ones and, therefore, the activity is sustained”, as explained by Lola Martínez, Director of CBRE research. “We are making up for lost time”.
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Madrid ranks seventh in the list of cities worldwide where luxury homes are more expensive
The price of “prime” homes in Madrid went up 10.7% in the last year (July 2016-June 2017) thus turning the Spanish capital city into the seventh city worldwide with the highest prices, according to some research conducted by Knight Frank consulting Company. Madrid and Berlin, which ranks eighth, are the only European cities within the first ten positions.
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The revival of real estate in Madrid in figures: 242 ongoing projects and 244 cranes
The real estate recovery is a fact in Madrid. It is shown by statistics on paper – increase of sales, authorizations, mortgages and prices – but it is also palpable on lands. Only in the capital city there are 244 active cranes and 242 ongoing projects of all types of construction, homes, offices, hotels, shopping malls, etc.
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“The sky is the limit”: Spain sets a historic record in real estate investments
The appetite for investment in Spanish real estate has no ceiling yet and our country is getting ready for a new historic record. So far, the first half of the year has achieved record figures after reaching a volume of investment of 6,100 million euros by the end of June, 38% higher than the same period in the previous year, according to data provided by CBRE.
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Madrid, Barcelona and Costa del Sol run out of new homes supply
Real estate experts indicate that the sale of property on an off-plan basis is soaring due to lack of supply.
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