4 February 2016 – El Mundo
The price of existing homes in Spain recorded, in the second half of 2015, an increase of 5.76%, representing the highest growth rate since 2006, according to XXII Market Report from Tecnocasa Group and the Pompeu Fabra University (UPF) in Barcelona. With this slight increase, the price per square meter has averaged in Spain the 1,560 euros.
As explained by the Head of Department of Reports Analysis (DAII) of Tecnocasa Group, Lázaro Cubero, after a cumulative decline of 55.29% from the peak of the historical series (late 2006 – early 2007), the data the second half of 2015 shows that the market “is in a phase of slight growth.”
Seville is the only city that has not experienced a rise in the price (stays stable), while the highest increase was registered in Barcelona, where house prices rose by 8.2% and now stands at 2,217 euros per square meter. It is closely followed by Madrid with an increase of 6.13% and 1,697 euros per square meter, and Zaragoza, where the price has risen by 4.29% and stands at 1,046 euros per square meter.
The average mortgage amount also grows
The average mortgage amount has also recorded a slight growth of 3.1%, following the change in trend that began in the first half of 2015 and now stands at 91,992 euros. Despite this increase, the monthly mortgage payment remains stable at 358 euros per month, due to the fall in the mortgages cost.
CEO of Tecnocasa Group, Paolo Boarini, has stated that credit entities begin to show more confidence and a trend towards more normal parameters as to granting mortgages, as drawn from the risk indicator analysis. For instance, from 2009 a tendency to grant shorter mortgages was observed, but in the second half of 2015 there has been a slight increase in the longest mortgages (mortgages to 35 years have gone from 2.3% to nearly 4% and 40-year mortgages from 1.4% to almost 3%).
Investment Buying remains steady
According to the DAI a 75.35% of buyers purchase housing to live in it, compared to 24.65% who buy it as an investment, a proportion that has remained stable for the past three years. The possibility of investing in housing “is still interesting due to the profitability offered by the market,” said Cubero, who added that the rent price “is rising in the big cities.”
José García-Montalvo, Professor of Economics at UPF and coordinator of the report, pointed out that the first-home buyer “has gained weight in the market thanks to the opening in the funding,” whereas investors in the current economic situation, have been found in housing “the only asset that provides positive returns.”
As for the first-time buyer, the majority (58.39%) uses a mortgage to pay off the property. The average profile of first-time buyer with a mortgage is that of a man (in 51.46% of cases) between 25 and 44 years (76.86%), Spanish nationality (76.42%) and with an undefined contract (78.20%).
The report has been performed with the data of intermediated operations by Tecnocasa Group, in particular with the purchases transacted through Tecnocasa and intermediated loans by Kiron, the intermediation financial network of Tecnocasa Group.
Original story: El Mundo
Translation: Aura Ree