26/11/2014 – El Pais
According to its latest update, the Spanish economy improvement may be beyond that growth, however mortgage lending for home purchase keeps on the downward track. From January to August, 134.082 loans were granted, hitting the lowest since the recession began.
In spite of that, the combination of rock-bottom prices and prospects of their rise over the next years seem to have an impact on sales to foreigners who already account for 16% of all purchases in Spain.
It is expected that in 2015 housing prices will average at €158.979 per unit, with biggest gains to be observed in Ceuta (4%), the Canaries (2%) and Aragon (2%).
During the years 2016-2016, the values are said to be slightly declining fueled by growth in the population number, its purchasing power and cost and access to financing.
Still, the real estate market has to digest available housing stock currently amounting to more than 560.000 dwellings, or even 740.000 if the REO assets in balances of banks and Sareb added up.
In such a context, no advance in lending is expected either. With a present record-low level of the Euribor rate (0.33%), in mid-term Spanish families would have to face an increased cost of their mortgages.
After three years of continuous cheapening, homes will start to get more expensive in 2019 or 2020. The turn in trend will be driven by a better balance between supply and demand once considerable part of the unsold stock absorbed and lending solidly reactivated, concludes Kelisto.es in its report.
Original article: El País (by Paula Cossío)
Translation: AURA REE