House Prices Keep Rising, Approaching 5.1%

1 September 2015 – Expansión

The real estate market continues its slow but steady recovery. In the second quarter of the year house prices increased by 5.1% compared with last year, placing this rate exactly in the pre-crisis level, as indicated today by the data of Property Registrars Association (Colegio de Registradores de la Propiedad).

This price rise, 2.8% in the second quarter as opposed to the first, was accompanied by an increase in the number of sales operations, which also grew by solid 11% YoY. Thus, between April and June, property records registered 87,187 home sales operations, representing the second highest quarterly result in the last two years. However, only in the second quarter the number of transactions fell by 3.7%, due to an exceptional increase in these registrations between January and March, explain registrars.

These experts believe that the year growth of housing prices “strengthens and intensifies the turnaround begun in 2014”. That said, they add that “the high growth rates (of house prices) are not foreseeable for the next quarters,” as the recovery in demand has been very progressive.

Moreover, they say it is “desirable that this housing market recovery, especially of housing prices,” occurs with moderate growth rates. This, in their opinion, will help to consolidate high levels of demand, thus depleting the new housing stock pending for sale, allowing also to absorb the newly built stock.

Andalusia (with 17,751 sales), followed by Catalonia (13,228) and Valencia (12,760) were the communities with the highest number of such operations in the second quarter. Demand for housing by foreigners also continued recovering. Home purchases registered by non-residents rose from 12.2% of the total between January and March to 12.8% in the second quarter.

Similarly, another indicator of the stabilization of real estate market has been the reduction of  the number of foreclosures (distraints mostly) for non-payments,which decreased by 4.8% compared to the previous quarter and 11.1% compared to last year.

Original story: Expansión

Translation: Lee La