One of the dangers of the real estate market is precisely the real estate not inherited from the last bubble. The increase in demand and the scarce availability of resources are already driving up the price of new construction.
In 2006, the real estate boom led to the construction of 127,000 new homes in Catalonia. While three years later, in 2013, just started 3.036.
From that moment, when the construction activity hit bottom, the recovery has been slow and gradual. Returning to normalization, although far from the volume of ‘the boom years’.
And precisely now, that the number of homes around the 25,000 annual visas, a new obstacle breaks in the sector.
According to the promoters and builders, grouped in the Association of Developers and Builders of Spain (APCE), the process to get work permits expands in time.
“It is unthinkable that the term to obtain a license is less than six months in municipalities with high demand, and we have even seen delays of over a year”, laments Lluís Marsà. In a complaint that affects not only the technical resources of the town halls, but also the lack of personnel in the works.
These delays have a direct impact on the final price of the property, as they have ratified the latest data from APCE in Catalonia. Increasing by 18.5% the average price of housing in the Catalan community. And shooting the construction activity of housing by 36%.
The price of new construction continues to rise
At the end of 2017, the average price of new housing in Catalonia stood at 245,923 euros (2,545 € / m2 useful), according to APCE. This supposes an increase of 18.5% during the last year.
The increase in the price of housing has occurred in most properties, from lofts to four-bedroom homes. Although the properties with 5 or more rooms have reduced their price. Reducing also its average surface.
Despite this, the number of promotions has fallen year on year. 291 fewer projects were completed than in 2016. As well as the number of homes for sale, which has been reduced by 2,013 units. In fact, the offered housing compared to the total existing in Catalonia represents 29.4%. Falling 0.6% compared to 2016.
In total, 1,286 new developments have been registered with 19,902 homes in Catalonia during 2017. And, of these, 5,844 units are still for sale.
Barcelona and Girona shoot their prices
The areas that have most noticed the rebound in the price of new construction have been the areas of Barcelona (+ 18.5%) and Girona (+ 87.1%). Especially the Costa Brava. While the province of Tarragona has only rebounded by 5.4%.
And Lleida has fallen by 7.4%. In the city of Barcelona, ??the imbalance between supply and demand of new construction has been very pronounced. Reaching the average price of new housing 495,054 euros.
‘The lack of finalist soil, the brake on urban promotion and the shortage of officials for the approval of licenses are aspects that stop the reactivation of the sector’, says Lluis Marsà. Neither the building nor the rehabilitation have just taken off.
In 2017, we have reached 11,000 new homes. Far away from an ideal scenario in which we would move around the 25,000. While the rehabilitation does not exceed 3.6% of visas.
Double speed of the territorial market
Of the total of 948 municipalities located in Catalonia, 40.9% have active promotions. These are places that account for 92% of the entire Catalan population. What supposes a proportion of 1.279 inhabitants by each offered housing.
Even so, there is a lack of territorial balance. Both at the province and county level. Barcelona has 54.4% of promotions underway. Well above Girona (19.5%), Tarragona (14.6%) and Lleida (11.5%).
In addition, the province of Barcelona has the highest average price per useful square meter. Specifically, € 3,335 / m2. Against the average of Catalonia, located at € 2,545 / m2.
Rehabilitation is a pending subject
As mentioned, compared to the price of the new construction, the residential reforms do not grow at the expected pace either.
96.4% of the new construction corresponds to new construction housing. While only 3.6% belongs to comprehensive rehabilitation projects. Renovation works that are concentrated in the area closest to Barcelona capital (Barcelonès). Where are 33 of the 53 active promotions in Catalonia. And 154 of the total of 208 registered homes.
Construction and rehabilitation of housing are still in full recovery. Although concentrating on a part of the territory and suffering directly from the lack of human and technical resources.
