The sale of housing in Spain will continue to grow at a good pace next year. A very different perspective from the British real estate market. Especially if we compare the parks of London, Madrid and Barcelona.
After a historic year for the residential market, an even better year can come. In 2018, housing will experience a growth higher than that registered in 2017.
The data correspond to the report ‘Residential market in Spain. 2nd Quarter 2017 ‘, prepared by Servihabitat Trends.
Specifically, it is expected that in 2018 the sale of homes will increase by 18%. Overcoming the 550,000 annual operations. Against the 16.9% increase and the more than 472,000 operations planned for 2017.
Taking the example of three representative cities such as London, Madrid and Barcelona, ??the opportunities of the Spanish real estate market are even better appreciated. Without forgetting that cities like Madrid and Barcelona are a priority objective for all types of investors.
Prospects for the real estate market in Spain
The increase in demand, access to mortgage loans, the interest of investors and the recovery of the new construction promotion are key factors in the scenario foreseen for 2018.
As in 2017, the Autonomous Regions with the highest sales volume will be Andalusia, Madrid and Catalonia. Keeping in the background the operations on new housing in front of the used housing, which continues assuming three out of four transactions.
On average, the demand for housing maintains a more or less defined profile. With a final price lower than 150,000 euros, in 70% of cases. And dimensions that do not exceed 90 m2 in one of every three operations. being the property with the most demand of three rooms (usual residence) or four bedrooms (holiday residence).
For 2017, up to 76,800 homes are planned. Amount that will increase to 93,600 in 2018 (+ 22%). A parallel trend to new construction visas: 117,800 permits in 2017 compared to 140,000 in 2018 (+ 18.8%). And even more clarifying if we take into account the finished homes, with a forecast of 61,300 properties in 2018 (+ 20%).
Housing overcomes the crisis in Madrid and Barcelona
According to the data of Servihabitat, certain neighborhoods and districts of Madrid and Barcelona will recover in 2018 the levels before the crisis.
In fact, the increases in the price of housing will continue to occur in the coming quarters. Both in the capitals and in their corresponding areas of influence. 7.5% more in the Community of Madrid and 7% in Catalonia.
While the increase of the sale will be even greater in the next year. Moving from selling 472,000 homes per year in 2017 (+ 17% year-on-year) to projecting more than 550,000 sales in 2018 (+ 18%).
A rebound that will occur more homogeneously than in previous years. Although Madrid, Barcelona and the main holiday destinations will continue to set the pace.
On the one hand, thanks to the demand for residential rental in the capital and the city of Barcelona. Large cities in which both business investment and entrepreneurial initiative and the arrival of tourists impact.
But also having Spain as the favorite destination of many foreigners interested in real estate investment or in the acquisition of a second home. Details that leads to concentrate more than 87% of the purchases of non-residents in seven Spanish provinces: Alicante, Balearic Islands, Murcia, Almeria, Malaga, Tenerife and Las Palmas.
London will continue to ‘moderate’ throughout 2018
The other scenario for the future real estate market is in the United Kingdom. And is that, after increasing 20% ??(2014) the price of housing in London, the British capital is immersed in a process of correction to the downside that could be maintained in 2018.
According to Rightmove data, the London residential market will depreciate 2% in 2018 after an expected fall of 1.8% at the end of 2017. A phenomenon that will translate nationally into a price drop of 1% next year. Unpublished since 2011.
The effects of Brexit have had an important impact on economic forecasts. Both the United Kingdom and the London city. Putting a brake on five years of increases in the real estate market in London.
In large part, due to the decrease in demand and the new taxes on the purchase of housing among the foreign upper classes. And also by the loss of economic capacity among the British to face the purchase of housing. In addition to the strict criteria for the granting of mortgages.
The segment most affected by this situation will be high-end housing. Shading the investment prospects. Faced with the recovery of the middle classes interested in the purchase of a habitual residence.
In 2018, ‘the UK residential market will continue in line with 2017’. That is, ‘subject to different price pressures both upwards and downwards, resulting in another year of slowdown in the price increase’, foresee from Rightmove.
