Recently, we reported that Engel & Völkers Mallorca experienced a 25% increase in sales in the 12 months to the end of November 2015, reaching a total of €300m. Read more: https://insuremyvilla.com/blog/2015/12/sales-rise-by-a-quarter-in-mallorca-in-past-year/
Now, Lucas Fox International Properties says that the amount of transactions by British buyers has risen by 26% across all key regions during the past year.
The Barcelona-based estate agent reports that Barcelona, Ibiza and the Costa Brava are the most in demand areas.
Data shows that the average purchase price by Britons dropped from €998,000 in November 2014 to €847,000 in November this year. Over this period, property prices started stabilising.
British buyers are looking out for new properties or high quality refurbished homes, with new developments in prime areas selling off-plan almost immediately, and in most cases, close to the asking price.
Local demand is also growing. Sales at Lucas Fox to national buyers increased by 50% from November last year to November 2015. The firm’s latest market reports also found that prices in Spain’s three key cities – Madrid, Barcelona and Valencia – are now slowly beginning to rise.
A founding partner of Lucas Fox, Alexander Vaughan, says: “In all of these locations, the improving market conditions are being driven by increasing levels of confidence amongst national buyers, something that is crucial for the market’s long-term recovery.
“In almost all our markets, this renewed confidence, a strong economy and the Spanish banks’ willingness to offer competitive mortgages has brought new investors into the market and we are now seeing international buyers competing against local buyers to secure the best properties in the most desirable locations.”
Figures for the third quarter (Q3) from the Spanish Property Registrars also show an increase in sales to national buyers, up by 16% to more than 80,000, compared with the same period last year.
Sales to foreign buyers were also up by 20% to 12,535 during the quarter. UK purchasers led the way, with the number of British buyers rising by more than half (53%) in Q3 2015.
Vaughan continues: “The last time the pound was above €1.40 was in 2007 and it has been consistently so during 2015. Spanish property prices in prime locations are still hugely competitive, especially if you compare them to the likes of other key European property investment hubs. An improving local economy is another major factor – growing at 3.4% from July to September, the fastest annual rate since 2008.”1
Additionally, mortgages are increasingly competitive, which has not been seen for several years.
Mortgage Direct’s Kevin Monger, a leading Spanish broker, comments: “I think that we are in for a prolonged period of low rates in the Eurozone. The economic climate is still very poor in many of the countries that make up the zone.
“I believe we may see small increments in the rate, once rates increase in other countries, such as the UK and the USA, but the circumstances are very different here and even in the UK and USA, they are talking about prolonged periods of low rates, so it will be no different here in the Eurozone.”1
Data from the Spanish Property Registrars also shows that prices across Spain rose by 6.6% annually in Q3 and 2.2% compared to the previous quarter.