Spanish property bargains becoming scarce
Photo: Dmytrok
The era of Spanish property bargain hunters is coming to an end, according to new figures, as the number of coastal resorts with rising prices continues to climb.
A new report from valuations firm Tinsa highlights the widening spread of rising prices in Spain. Indeed, 35 resorts have seen values increase year-on-year in Q1 2015. A year ago, only four saw prices increase.
In Javea, on the Costa Blanca, prices have surged 11.2 per cent, notes El Pais, which published the Tinsa report. The average sales price there is now 1,658 euros per square metre.
"All is not lost," reassures Tinsa. "There are 29 locations spread across the Spanish coastline whose homes have lowered their prices by more than 10 per cent in the first three months of the year."
Indeed, Pallafruguell in Girona saw prices fall 16.9 per cent in the year to Q1 2015. Data from the General Council of Notaires also shows that prices fell 1.9 per cent in April nationally.
Nonetheless, the market is changing. Sales rose 2 per cent in April, according to the Notaires.
In Marbella, Carlos Smerdou, managing director at Foro Consultores, notes that stock is now running out, with new projects beginning to pop up - and even developers keen to complete previously halted developments.
The end of the property crisis has also been confirmed recently by the Bank of Spain and the government has stated that the country's economy is growing at its fastest rate since 2008 - close to 4 per cent in the first six months of 2015 compared with the same period last year. The Bank of Spain has predicted growth of 2.7 per cent in 2016.
Estate agency Lucas Fox has released a report to mark its 10-year anniversary, illustrating the changes in the market since 2005. Prices are now steadily beginning to rise, says the report, after falling from their 2007 peak and stabilising in 2014.
"Since mid-2013 the number of sales transactions has steadily increased in all Lucas Fox regions, indicating greater confidence in the market and more recognition amongst buyers that prices are at their best level," comments Lucas Fox co-founder Alexander Vaughan. "But there is some way to go before sales trading reaches anywhere near 2007 levels, in part due to the lack of quality stock available,"
Vaughan also highlights the new developments coming onto the market.
"The new breed of developers are a combination of the better national developers who have survived the last eight years and also international developers. Both often have institutional money behind them and are not reliant on bank finance," he explains.
The other Change has occurred from the buyer side of the market, as Lucas Fox credits the market recovery to the rise of "lifestyle investors".
"They want to make a wise property investment but choose Spain because of the quality of life it offers. This is a key trend in the recovering market today, which we believe offers 'once in a decade' conditions," says Vaughan.
Nonetheless, while buyers may be rushing to make the most of coastal bargains while they last, Lucas Fox welcomes the new wave of supply.
"New developments appeal to everyone, local and international buyers, basically anyone who wants to own a brand new modern home," Vaughan comments.