RR de Acuña: Spain’s Housing Market Recovery Will Be Asymmetrical

17 September 2015 – Expansión

Real estate trends / RR de Acuña’s “Real Estate Yearbook” confirms the “stabilisation” of the upward trend in the market.

The recovery in the housing market is going to be long and asymmetrical. On the one hand, progress will be mild but steady in large cities and consolidated areas on the coast. On the other hand, provinces with a lot of stock are in for a long, idling journey. Finally, in the prime areas – districts in the centre of the regional capitals, exclusive urbanisations and luxury developments – growth will be much more marked. What does the photo look like on aggregate? The sector will continue to stabilise, without bubbles or depressions.

Those are the main findings to be drawn from the Spanish Real Estate Market’s Statistical Yearbook for 2015, prepared by RR de Acuña y Asociados. The forecasts made by the real estate consultancy firm are promising, but prudent.

After seven consecutive years of declining house purchases, 2014 marked “a turning point in the property cycle” and 2015 and 2016 are expected to close with figures that are clearly positive. Firstly, the trend in house prices is expected to normalise. In other words, the cost of buying will increase but “not excessively”, said Fernando Rodríguez de Acuña, Project Director at the company, yesterday, during the presentation of the report.

It is true that house prices will increase “significantly” in the most consolidated areas and in those regions that have smaller stocks of unsold property. In these areas – above all, Madrid, Barcelona, Valencia, Málaga and Alicante – homes will become between 3% and 5% more expensive during 2015 and 2016.

But, residential property prices will increase by even more in certain very important – the real estate sector is a market that must be divided into submarkets – . “In prime areas, prices will rise by more than 5%”, said Rodríguez de Acuña. In other words, “in the best neighbourhoods of the central districts of Madrid and Barcelona, and in the VIP areas of Marbella and Palma de Mallorca, amongst other areas”.

More sales of second hand homes

Moreover, sales will increase in Spain by more than 10.5% in 2016, and 2015 is expected to close with fewer transactions involving new homes and less self-promotion, but with a net recovery of 9.6% in the market for second hand properties. (…).

Other data also points to a considerable amount of realistic optimism. Mortgage lending will soar “clearly” by more than 20%, assures Rodríguez de Acuña, on the basis of another report from his firm that has not yet been published. (…).

Unsellable homes

The stock of unsold homes will decrease by 117,000 over the next two years. But here, two important observations are required: firstly, mortgage financing still barely accounts for one fifth of its previous levels and the total stock of homes still exceeds 1.5 million units. (…).


The Real Estate Yearbook for 2015, which is dedicated to its creator, Fernando Rodríguez y Rodríguez de Acuña, who died recently, devotes an entire section to one indicator, which is key to defining the different speeds of the recovery: the time required to sell all of the stock (‘el tiempo de disolución del stock’ or the TDS). In other words, the number of years it will take for demand to absorb the excess supply of homes for sale. Only Madrid and Navarra have a TDS of less than 3.5 years.

Meanwhile, Barcelona, Sevilla, Alicante, Málaga, Granada, Huelva, Vizcaya and Guipúzcoa all have TDSs that range between 3.5 and 5.5 years. At the negative end of the spectrum, some provinces have TDSs that exceed 10 years. Their stock is almost unsellable. In any case, the surplus is gradually decreasing, in general terms, and the cranes are returning, albeit very slowly. (…).

In summary, “the forecast restoration of the balance and subsequent growth in the real estate sector” will be two “slow” processes and there will be “different speeds in the recovery of the real estate sector, which will vary by geographical area”.

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake