13/02/2014 – Cinco Dias
The doomest scenarios came true and the year 2013 was the sixth consecutive annus horribilis for the Spanish real estate market. (…).
According to the information gathered by INE (the National Statistics Institute), six years after the bubble burst hardly 40.000 dwellings are being started per year while during the boom around 865.000 permissions were being issued for new construction startup. What is more, houses suffer 40% to 50% depreciation, for example in 2007, 775.300 dwellings were sold whereas the last year registered only 311.414 transactions.
This means that instead od average 2.5 house sold that time, now only one changes its owner and a mere 4.6% of the construction volume in 2007 is being built. Also, record low number of mortgage granting is being noted down. Thus, no wonder than Spain lost 6% in its GDP and about 18% in the emploment rate.
As INE pointed out, 46.6% of overall housing sales last year corresponded to the new construction, whereas remaining 53.4% to second-hand houses. In case of the first, 145.241 transactions were carried out that is 6.8% less than the new flat sales in 2012.
However, last year 166.173 pre-owned houses sold, that is 2.2% more than a year before. The fact could be considered a rebound point (…).
Why the sales of new houses continue to fall while the second-hand´s climb up? Firstly, the supply of pre-owned dwellings is much larger and varied than the one of new houses. Most of the volume of the latter is focused on the unmarketable, unfinished developments in less attractive areas and on the second residencial houses along the coast or in touristic areas.
On the contrary, the supply of pre-owned houses is much more diverse and found all over the country, so a purchaser has got a lot of choice to pick cherries from. (…).
Obviously, prices and demand have got an influence on sales, too. In the first case, the lower, the better, of course. However, the demand persist linguishing due to small transaction volume but the optimistic predictions re-convince inverstors to look at Spanish houses again.
Original article: Cinco Días (Raquel Díaz Guijarro)
Translation: AURA REE