10 December 2015 – El Economista
Second-hand house prices are going to close 2015 with a YoY decrease of between 1% and 2%, according to pisos.com, which forecasts that they will grow again in 2016.
And next year will be a strong year not only for second-hand homes, but also for new builds, despite the tax advantages of the former compared with the latter.
“The evolution of prices highlights the improved pace of activity in the real estate sector, which has now left behind the large drops and promises to make a definitive comeback in 2016”, says the Director of Research at the real estate portfolio to which the CEO, Miguel Angel Alemany, adds that 2016 will be a “fantastic” year for developments to overturn the market.
“There is a significant amount of demand eyeing up the upcoming residential developments, something that supports sales off-plan, a phenomena that practically disappeared during the crisis”, adds Alemany, who predicts that “next year, the gap between these two types of operations will become narrower, thanks to the deliveries that will be formalised.
All of this is due to the fact that, in the background, there is a greater understanding between some very competitive financial institutions and a well-informed demand.
This understanding is expressed in the purchase and sale of homes that, according to the real estate portfolio, will continue along the same lines as in recent months, to finish the year with around 41,000 more operations than in 2014, which represents an increase of 11%, according to the registers held by the National Institute for Statistics (INE).
In the same way, mortgage lending will end the year with growth of 22%, i.e. around 46,000 more loans, according to the forecasts set out by pisos.com.
Change of buyer, change of market
Thus, the buyers and the financial institutions have changed and they are showing different attitudes as we emerge from the crisis. The former are leaving behind opportunistic purchases, based on pure investment criteria, with the value in use of homes gaining weight.
“Buyers are no longer looking for bargains that allow them to live off the rental income, but rather they are looking for homes according to their own needs”, says Alemany, who immediately adds that owners “have come to their senses” and now “wise clients are those who wait to build up their savings and avoid the requirement for guarantors”. Meanwhile, the banks now appreciate customers who come to their branches with their accounts already prepared.
Cautiously looking ahead to the future
Thus, at the real estate portal, they consider that “sustainable growth in the residential sector doesn’t seem so difficult to achieve any more”. Nevertheless, they urge buyers to be “cautious” given that long-term volatility in variable interest rates may lead to nasty surprises in the future for those individuals who are now taking our mortgages now whilst Euribor is at historical lows.
Moreover, pisos.com points out that “any political decisions that are taken after the general election affecting the housing market must be coherent, considered and responsible”.
Original story: El Economista
Translation: Carmel Drake