Number of sales for Spanish real estate rose in January 2012

Posted on May 2nd, 2012 in Real Estate in Spain by editor

Seen year-on-year the volume of Spanish sales transactions may still be down by 18.6% compared to the same period in 2011, but the number of completed sales rose in January in comparison to the previous month.

The latest data from the Spanish National Statistics Institute (INE) confirmed that the number of transactions for real estate rose by 42.3% in January of this year compared to the final month of 2011.

Interestingly, the INE’s report stated that only 13.8% of all transactions were registered for rural properties, showing that urban properties are what attract buyers these days.

They also seem to be in favour of new versus old, with 54.1% of sales transactions being for new build homes.

In the holiday lettings segment of the market Spain is also showing some improvement, said INE’s report. The number of holidaymakers opting for the self-catering property type rose by 4.7% in January this year, compared to the same period last year.

Buyers looking for an investment opportunity should take advantage of the low Spanish property prices now, especially with rising number of tourists expected to visit Spain this year.

SOURCE: www.propertyshowrooms.com

Murcia increasingly of interest to property buyers

Posted on May 2nd, 2012 in Real Estate in Spain by editor

One property market expert said more enquiries about Murcia real estate were being received than for other property markets such as Portugal or the United Kingdom.

Jon Ainge, director of International Property Success, commented how the proposed theme park Paramount Studio were building was beginning to work its magic, especially now since construction on the site is to start in May 2012. “We expect demand for property to increase as a result,” Jon Ainge added. While Murcia is undoubtedly a great location for investment, he cautioned buyers to look for the best locations for their investment, such as 5-star resorts, rather than be swayed by apparent bargains.

The theme park has potential to cover about one million square meter area of land, which the developers have so far purchased and what will be a major tourist attraction in Murcia is scheduled to open its doors to the public early in 2015. The Paramount theme park is to have more than 30 attractions and 2 on-site hotels with a business and leisure complex being planned to be constructed on an adjacent site.

SOURCE: www.propertyshowrooms.com

Spanish property market will see an upturn this year

Posted on April 19th, 2012 in Real Estate in Spain by editor

Commenting on the real estate trends of 2012, CBRE’s president Mr Eduardo Fernandez-Cuesta expressed his organisation’s views that transactions for the property market this year will show an increase compared to 2011, but warned that home values would continue to undergo a downward price adjustment.

The CBRE president made his predictions during a presentation on trends in Spain’s real estate market and said that the most sales transactions currently being registered were those for properties with price tags of between €100,000 and €120,000, where 100% finance packages were offered as part of the deal.

Basing his comments on his company’s survey of 200 industry professionals, Mr Fernandez-Cuesta added that 90% of those questioned predicted sales prices for residential properties would decline further, however, the same experts stated that Madrid and Barcelona had pretty much reached their bottom level in the current price adjustment.

Discussing the individual segments of the residential sector, the survey showed that new housing developments would continue to suffer, while refurbished existing homes and the rent-to-buy sectors would fare much better this year.

CBRE’s president highlighted the need for a recovery of the property market to take place soon, as banks and other financial institutions needed to tidy their balance sheets and rid themselves of unsold assets.

He added that public spending cuts in the light of the Government’s austerity measures would have an impact on the management of civic property assets used for administrative purposes. Adolfo Ramirez-Escudero, CEO and consultant of the company, explained this point further. Of the 200 industry professionals questioned, 95 % stated that such municipal bodies are not making the most of their real estate assets.

The survey showed that 91.8% of property experts estimate financial institutions are also not making the most of the property assets in their possession, while 60% of experts believe that banks will add to their real estate portfolios this year rather than divest of housing stock.

Seen on a business by business sector basis, experts believe that the office market will attract more investment than the retail sector, closely matched by the residential and industrial real estate sectors.

Looking more closely at the subject of investment, the study suggests that 53% of experts questioned believe the opportunistic funds market will be looking to invest more on a higher returns basis, with the remainder coming from private investors (20%) and institutional investors (13%).

The survey also revealed that the predictions for real estate organisations outside of Spain included an upturn for hotels with the fastest growth predictions and the office market as the most likely to be of increased interest to overseas investors.

El Economista reported that the survey further revealed an upturn of the real estate market would go hand in glove with a reduction of unsold real estate currently on the market. Some 50% of experts questioned believe that this year far more properties will be sold than last year, predicting that this would affect all sectors with the exception of the logistics real estate market.

SOURCE: http://news.kyero.com

Overnight stays in Spanish hotels rose by 3.5% at the start of the year

Posted on April 19th, 2012 in Real Estate in Spain by editor

January 2012 figures published by the National Statistics Institute show that 12.6 million visitors opted for overnight stays in Spanish hotels during the first month of the year, which represents a 3.5% rise in a year-on-year comparison.

While the overnight stays for residents fell slightly by 0.2%, the number of overnight stays for non-residents rose by a significant 6.1% with the average length of stay going up by 1% at the same time compared to the same month in 2011. The average length of stay recorded now stands at 3.1 nights per person.

Another study, the Hotel Price Index (HPI) showed an increase of 0.3% for January 2012. Turning to the overall profitability of the hotel sector and the average room rate achieved, the HPI study shows that while invoiced overnight stays per night were on average €68.30, the actual profit made per room was €28.90.

Occupancy rates of available rooms stood at 37.4% for January this year, which represents a 3.3% rise on the same period in 2011. At weekends the occupancy rate rose to 40%, which represents a 2.2% rise when compared to the same month a year ago.

Overseas Visitors’ Overnight Stays

A breakdown by country shows that in January 2012 a greater number of German guests stayed overnight than British visitors. The overnight stays for German guests were recorded at 27.3% and for British visitors overnight stays stood at just 21.1%, which means the German market segment rose by 3.7% on the same month a year ago, while the British holidaymakers only represented a 0.8% rise.

Overnight stays from guests coming from Italy (down 5.5%), France (up 10.2%) and Sweden (up 25.7%) were also an indicator of the respective economies in those countries, which influences tourists’ decisions on holiday budgets.

Favourite Holiday Spots

As in previous years the most popular holiday destination for tourists from other countries are Andalusia and the Canary Islands. Overnight stays by foreign guests holidaying in the Canary Islands went up by 7.7% compared to the same month a year ago. In second place is Cataluña with a 1.1% increase and Andalusia is in first place with a 14.7% rise.

With regard to Spanish residents holidaying in their own country, they favoured Andalusia, Cataluña and the Communidad de Madrid for overnight stays. Here the year-on-year comparison shows a downturn for Andalusia (5.4%), but an upturn for Madrid (0.3%) and Cataluña (3.7%).

The Canary Islands, seen on a year-on-year comparison for highest occupancy rates by room, were the winner with 71.3%, with the Communidad de Madrid in second place (41.0%) and Communidad Valenciana in third with 35.3% occupancy rates per room.

Occupancy and overnight stay rates were best for the island locations as well as coastal regions and the resorts located in the Pyrenees. In this category Gran Canaria was the clear winner with an occupancy rate by room recorded at 78.0% and a weekend occupancy rate by room at 78.7%.

Holiday Island Tenerife had a record 2 million overnight stays just for January 2012, while Madrid, San Bartolomé de Tirajana and Adeje recorded the greatest number of overnight stays. Popular tourist destination Arona achieved the highest occupancy rate by room with 83.3%, while Puerto de la Cruz boasted a weekend occupancy rate of 83.8% per room.

Considering a year-on-year comparison of January’s results, the HPI reached 0.3% this January, a 1.6 point increase from December 2011 and a 1.2 point rise from those recorded for the same month in 2010.

SOURCE: http://news.kyero.com

Newly built homes’ values to fall further this year

Posted on April 19th, 2012 in Real Estate in Spain by editor

Cincodias.com reported that the Spanish government predicts the asking prices for newly built homes will fall further in 2012, bearing in mind that nearly 65% of all housing surplus is located at the Spanish costas. The lack of available credit and stagnant labour market has made it more difficult to reduce the number of empty new homes on the market.

The most dramatic price adjustment will be reserved for the 800,000 purpose built holiday and second homes, which are mainly located at the Mediterranean coast.

A recently published study conducted by Cataluña Caixa suggests that two thirds of unsold, and seemingly unwanted housing stock were constructed in coastal areas, ore more precisely, some 65% of such homes were built in Andalusia, the Balearic Islands, Catalonia,  Murcia and Valencia.

The latter is the worst affected region with nearly 210,000 unsold homes still on the market at the end of September 2011, which reflects 25.6% of the total unsold housing stock. Seen in combination with 137,000 unsold homes in Murcia and 107,000 unsold properties in Catalonia, this represents a 55.4% share of the overall unsold surplus.

Worrying still, while the overall availability of new housing stock may have reduced down over the past couple of years, in the Basque Country, Catalonia and Valencia more newly built homes have come onto the market.

Seen on a province by province basis, Castellón is showing a volume of almost 114,000 empty homes, whereas Alicante and Barcelona recorded 57,000 unsold newly build homes respectively. Murcia recorded another 52,000 unsold properties and Valencia registered some 40,000 newly build, unsold properties.

SOURCE: http://news.kyero.com

Office market in Spain will remain stagnant until 2013

Posted on March 31st, 2012 in Real Estate in Spain by editor

Commercial real estate experts Savills believe the office market in Madrid won’t show an improvement until 2013, although the beginning of 2012 has been encouraging.

Savills believe that investment in Spain’s commercial real estate sector will be hampered by a lack of demand for office space and a distinct shortage of trust in Spain’s economy picking up any time soon.

Gema de la Fuente of Savills’ Research noted that growth in Spain was likely to remain “muted until 2013”, adding that, as overseas investors were concentrating on  retail, the domestic market would be more likely to control the office market in 2012.

Among the few highlights in Spain’s commercial property market was the sale of Torre Picasso in Madrid. With 43 storeys Torre Picasso ranks as one of Madrid’s tallest skyscrapers, using most of the space as offices. The office development changed hands for €400 million / £338 million at the beginning of this year and Savills confirmed that this particular deal accounted for 10% of the total volume of transactions brought to completion by the end of 2011.

The buyers are Pontegadea Inmobiliaria SL, an investment company founded by Zara’s Amancio Ortega. The intention to sell was announced at the very end of last year, when construction company Fomento de Construcciones y Contratas made the deal public.

SOURCE: www.propertyshowrooms.com

Getting a foothold on the Spanish property ladder with distressed properties

Posted on March 31st, 2012 in Real Estate in Spain by editor

Not every investor has access to large funds to start their property portfolio. Distressed properties in Spain present would-be investors with an ideal opportunity to get in on the buy-to-let or holiday-let market.

Jon Ainge, director of International Property Success, pointed out that, while banks have introduced far stricter lending criteria, which have made funding a property problematic for some investors, they are willing to advance mortgages on Spain’s distressed properties. Recently introduced legislation forces Spanish banks to shed the glut of properties on their books in order to reduce their exposure to under-performing assets.

Jon Ainge explained: “If banks currently finance a development they are keen to deleverage themselves of the current risk they hold – this is where you will find that most loans are not being issued in countries such as Spain.”

The recently published Global Distressed Property Monitor by the Royal Institution of Chartered Surveyors revealed that increased demand for distressed properties had occurred in the last three months of 2011, far more than in the previous quarter.

Industry experts forecast roughly the same number of distressed Spanish properties would enter the housing market in the first quarter of 2012 than there had been listed in the previous quarter.

SOURCE: www.propertyshowrooms.com

A Retirement nest egg with Spanish property?

Posted on March 31st, 2012 in Real Estate in Spain by editor

With the latest budget having been announced in the UK many people are looking at different options to boost their retirement funds – how about making Spanish property part of the retirement fund?

Jon Ainge, the director of International Property Success, believes that using Spanish property with capital growth and holiday rental income potential to boost retirement portfolios is not a bad idea.

“I believe the returns from overseas property, particularly in locations like the Caribbean, the Algarve and Spanish coast can help fund retirement and should be part of a pension portfolio,” Jon Ainge explained.

The idea of buying real estate in Spain has of late interested far more British people than before. Liz Rowlinson, the editor of A Place in the Sun magazine, observed that falling house prices have made Spanish homes more affordable, while at the same the traditional factors of great amenities, warm sunny climate and beachside holidays are still as appealing as ever.

SOURCE: www.propertyshowrooms.com

Spanish property prices continue the downward spiral

Posted on March 14th, 2012 in Real Estate in Spain by editor

January’s house prices saw the worst depreciation since 2008 and, while this news was greeted cheerfully by potential foreign buyers, the Spanish press has expressed fears over a deepening of the crisis.

Spain’s new government, headed by the People’s Party, appreciated the “good” news, as lower prices mean greater affordability. Government officials are currently putting pressure on banks to cut prices for residential properties by launching higher capital requirements and making far greater provisions for bad debts and “undesirable” properties on their books, namely those properties that are unlikely to be sold.

Idealista.com, a Spanish online property expert, commented on January’s sales results as being “the worst month since the Spanish housing crisis started four years ago” and underpinned their statement with statistics that revealed a 9.4% decrease in a year-on-year comparison with 2011.

Traditionally, December and January are the worst months for selling property anyway, which means the average month on month decrease of 1.9% has to be seen in context. The average price per sq. meter is static at €2,000, meaning a typical 2-bedroomed holiday apartment still sells for just €130,000.

This is potentially good news, as low prices at desirable locations such as the costas have already caught the attention of international investors. Large numbers of self-catering tourists coming to Spain for their holidays have the potential to increase yields on rental income and Spain’s revenue from tourism was at a record high in 2011.

It is estimated that at least 36% of all bank-owned housing stock is in seaside locations. Such developments received generous funding during the housing boom years, when developers speculated on rising prices. Now such key-ready housing stock bargains are luring potential buyers from the Benelux countries, the UK, Germany and Scandinavia to Spain once more.

Propertyinspain.net, a specialist in bank-owned housing stock, described the whole debacle best by saying “crisis, what crisis? Price reductions are good news for both international and Spanish buyers.”

Is Spain’s government right after all? Affordability can be measured in two ways: who can afford to buy in Spain at what price? Domestic buyers have far less money to spend on properties located at the costas than international investors, but this has prompted Spanish buyers to look for property bargains in cities and towns, leaving the seaside housing stock largely to foreign buyers.

The Bank of Spain has told off the country’s banking sector, suspecting that prime properties are being held back until better market conditions are starting to surface. Housing stock that nobody else wanted has instead been offered at rock bottom prices to bank employees, their families and friends, even to long standing customers. Despite such tactics, some 600,000 housing units remain unsold to-date, representing a year’s worth of housing stock during 2007 peak times.

Spain’s banks will come under increasing pressure to release quality properties in prime locations at the costas onto the market to achieve more sales. They will also be called upon by the government and the Bank of Spain to come up with better incentives, so that international buyers can take advantage of lower prices and improved finance options.

SOURCE: www.propertyinspain.net

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Spain’s leading developers urge government to introduce mortgage interest tax relief on holiday homes

Posted on March 2nd, 2012 in Real Estate in Spain by editor

An introduction of mortgage interest tax relief on holiday homes could stimulate demand and cut the oversupply of unsold holiday homes at the costas, says the G-14 association of Spain’s leading property developers.

They are urging the government to adopt new measures to deal with the crisis in the holiday homes market. The Spanish government has reintroduced mortgage interest tax relief on main homes, even though experts warn that homeowners occupying their properties will be better off, while tenants renting a home will suffer, a measure that makes it far more difficult to get the rental market moving into the right direction again.

Quoted in the Spanish press recently, Antonio Carroza of rental company Alquiler Seguro said this request is nothing short of “irresponsible”, since public money would be used to effectively subsidise large-scale developers to finally shift second homes that should never have been constructed in the first place. Such mortgage interest tax relief should only be extended to resident Spaniards, not foreign investors who purchase holiday homes in Spain.

The G-14 association also urged the Spanish government to cut ITP sales tax on resale properties, a move that would help private vendors.

SOURCE: www.spanishpropertyinsight.com

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