6/01/2014 – Cinco Dias
Average new dwelling in Spain cheapened by 2,2% throughout 2014, thereby cutting in its 2013 value loss of 7.8% by five points, appraiser Sociedad de Tasacion reports. In its latest update, the firm remarks that over the last six months the prices dropped by only 0.4%, compared with the 1.8% registered in the first half.
Precisely, average price per square meter in provincial capitals showed 1.994 euros, meaning a cost of 179.400 euros for a 90-sqm home. New housing has suffered a 40.2% value loss since its hights.
In 2014, new property prices fell in all the Spanish regions, above all in La Rioja (down 3.7%), Aragon (3.5%), Asturias (3.1%) and Extremadura (3%). On the other hand, the smallest depression was observed in Navarre (down 1.2%), Castille and Leon (1.7%), the Canaries (1.7%), Galicia (1.8%), the Basque Country and Andalusia (down 2% in both).
When it comes to the most expensive capital city, San Sebastian once more tops the ranking with a price of 3.336 euros per square meter, followed by Barcelona (3.129 euros) and Madrid (2.663 euros).
In turn, the most economic new homes are found in Badajoz, Caceres, Ciudad Real and Murcia as they are asking for less than 1.200 euros for a square meter.
According to Sociedad de Tasacion, home-price slump has cooled down due to easier access to financing and better economic outlook for the industry.
Moreover, there has been a significant rise in bulk asset purchases by foreign investment group. Apparently, among the demand for under-5-year-old properties reverberates interest of private buyers.
What Should We Expect in 2015?
In the ‘2015 forecasts’ section, Sociedad de Tasacion predicts there will be a correction in housing supply started at end-2008 to align with the demand. ‘The weak recovery traces seen a year ago now become clearer and clearer’, the company assures.
As a result of a decrease in Spanish household wealth which will not be compensated by a 0% inflation, combined with the uncertainty lingering over the labor market, new home sales will be crippled.
On the other hand, Sociedad de Tasacion believes that new housing supply will remain considerable throughout 2015, in spite of slow production pace, whereas the demand will start to rise in line with an increase in number of quality jobs and financing.
“The trend of switching from selling to renting will continue to grow, both in case of lease-to-buy or just lease properties”, portends the appraisal firm.
Original story: Cinco Días (after EP)
Translation: AURA REE