Tag: appraisal company

Approval Granted for Socimi Arrienda Rental’s Debut on the MAB

21 December 2018 – La Vanguardia

The Coordination and Incorporations Committee of the Alternative Investment Market (MAB) has issued a favourable report ahead of the stock market debut of Arrienda Rental Properties Socimi, with a reference value of €2.74 per share, after the company was valued at €56.4 million.

The MAB has reported that the stock trading code for Arrienda Rental will be YARP and that it will be governed by the fixing system, with prices being fixed twice in each session, at 12 noon and 16h.

Arrienda Rental is a real estate company that has adopted the Socimi framework and which is dedicated to the acquisition and development of urban properties for their rental.

The Socimi owns 239 assets, all of which are located in the Community of Madrid: 2 hotels (Clement Barajas and Täch), 3 plots of land, 4 offices, 18 retail premises, 40 homes and 172 garages.

Before its stock market debut, the Socimi had 51 shareholders, including Francisco García Rubio, who owns 21% of the capital.

Arrienda Rental has 4 managing directors who are also owners, namely: José García Sánchez, Luis Miguel Gutiérrez Abella, Víctor García Rodríguez and Juan Francisco García Muñoz.

Arrienda’s valuation has been performed by the appraisal company Gesvalt.

Original story: La Vanguardia

Translation: Carmel Drake

AEV: Spain’s Appraisal Companies Invoiced €283.8M in 2017, Up By 17% YoY

18 April 2018 – Eje Prime

Appraisal companies are thriving in Spain. According to the latest data from the Spanish Association of Value Analysis (AEV), the turnover of the 23 associated appraisal companies during 2017 amounted to €283.8 million,  up by 17.1% compared to the previous year. This upward trend is experiencing an acceleration that almost doubles the turnover growth rate recorded between 2015 and 2016 (9.2%).

Moreover, this ascending inertia is observed in the great majority of the data analysed. The number of real estate appraisals performed increased by 18% to reach 1.25 million appraisals, corresponding to a total appraised value of €389.5 billion. The 650,000 appraisals that were issued for the purpose of mortgage guarantees stand out, in particular, since they represent 24% more than the number carried out during the previous year, according to data from the association.

The number of appraisals conducted without visiting the interior of the property grew substantially, by 67% to be precise, as did the number of appraisals performed online, although at a more moderate rate (by 15%).

In terms of the regional distribution of house appraisals by autonomous community, Murcia recorded the highest growth with respect to 2016, up by 38%. It was followed by Valencia (36%), Cantabria (31%), the Balearic Islands (25%) and Cataluña (25%).

Original story: Eje Prime

Translation: Carmel Drake

Spain’s Most Expensive Homes are Located on c/Serrano & Paseo de Gràcia

1 March 2018 – Expansión

Two realities in the housing market / The recovery in prices with respect to 2008 is leaving disparate scenes. The gap between the most expensive area of Madrid, on Calle Serrano, and the most affordable district, San Cristóbal, amounts to 61 percentage points.

In the heart of Madrid, on Calle Serrano, a 90 m2 apartment costs around €857,700 (€9,530/m2) on average, 5% less than in 2008. Meanwhile, 16 kilometres south of the Golden Mile, in San Cristóbal, those same 90 m2 cost around €78,300 (€870/m2), 66% cheaper than during the years of the real estate boom. This situation is repeated right across the country, where, in many cases, the housing market is experiencing two realities in the same city. “The current housing market in Spain is certifying the recovery of house sales and reflects that there is still scope to acquire homes at much lower prices than 10 years ago”, said José María Basañez, President of TecniTasa.

Despite the high degree of activity in the sector at the moment, with increases of around 5%, it is not uncommon for people to buy a home now for less than it would have cost in 2008. In 2017, house prices were 35% below the peaks of the real estate boom, according to a Report about housing Maximums and Minimums prepared by the appraisal company TecniTasa. The situation changes as you approach the hot spots of the main capitals. The difference between the most expensive and most affordable areas of Madrid is 61 percentage points, of Barcelona is 38 points and of Sevilla is 54 points. The most affordable homes in the Andalucían capital are found in the areas of Amate/ Pino Montano/Macarena Norte and Bellavista (€990/m2), nevertheless, it is one of the few areas where prices are higher than they were a decade ago (up by 24%). It is followed by La Rambla de Pedro Lezcano in Telde (Las Palmas) where prices have risen by 9.7%; the centre of Orense (5.7%); Las Gándaras (Lugo), where prices have risen by 4.4%, and the historic centre of Toledo (1%).

The fact that the most luxurious homes are still 30% cheaper than they were in 2008, on average – on c/Serrano and Paseo de Gràcia, they exceed €9,000/m2 – and the most affordable homes are still 40% lower – in El Pilar de la Estación (Toledo) and Barrio Guinea (Castellón), they cost around €400/m2 – “is one element to take into consideration when making a purchase decision”, explain sources at the appraisal company.

Original story: Expansión (by I. Benedito)

Translation: Carmel Drake

26 Spanish Real Estate Experts Share Their Predictions for 2018

6 January 2018 – Expansión

House prices will rise by more than 5% on average this year, with increases of more than 10% in the large cities. These gains will happen in a context of great dynamism in the market, in which house sales will grow by more than 10% to exceed 550,000 transactions. Rental prices will also continue to rise.

Those are just some of the predictions made by 26 real estate experts for Expansión.

Aguirre Newman: “House prices will grow by more than 10% in Madrid and Barcelona”.

“In our opinion, house prices are going to continue to rise in 2018, reaching average growth rates of 6%-7%”, says Juan Riestra (pictured above, top row, second from left), Director of the Residential Area at Aguirre Newman. “In Madrid, Barcelona and the coastal cities, we expect to see double-digit growth, driven by the supply of new homes that the property developers have announced, which will result in an even more intense increase in prices than seen in 2017 since new build home are typically more expensive than second-hand properties”, he adds (…).

Fotocasa: “New build homes will have a higher profile in 2018”.

“New build homes will have a higher profile in 2018, as we have already seen during the last quarter of 2017. And that, combined with the return of confidence to the housing market, will continue to push prices up if the economic context is maintained and the situation in Cataluña is resolved”, says Beatriz Toribio (pictured above, bottom row, second from left), from Fotocasa, who thinks that this effect will drive up house prices by more than 5%, but not reaching double-digits (…).

Universitat Pompreu Fabra: “Everything depends on the situation in Cataluña”.

“The upward momentum in the market will be accentuated in 2018 due to the improvement in the new build market since the homes that started to be built two years ago are now being sold”, said José García Montalvo (pictured above, top row, second from right), Professor of Economics at the Universitat Pompeu Fabra. “The major change is that new homes now account for 20% of the market, whilst before they represented 60%” (…). But “everything depends on the political uncertainty in Cataluña” (…).

Arcano: “Demand for investment in housing will continue to grow”.

“There is still a very significant imbalance in terms of demand, spurred on by the ECB’s policy and labour improvement, and a supply that is still restricted by the very low level of new house starts. Moreover, demand for housing as an investment will continue to grow. In this context, prices will rise by more than 5%”, says Ignacio de la Torre, Chief Economist at Arcano (…).

Notaries’ Centre for Statistical Information: “We expect house prices to increase by more than 5%”.

“On the basis of our analysis of the available information, we expect house prices to grow by between 5% and 10% in 2018 (…). Although we expect the housing stock to increase, due to greater investment and employment in construction in recent months, which may lead to price rises being contained, we also expect an increase in demand, given the dynamism of economic activity and the behaviour observed in the labour market”, says Milagros Avedillo, at the Notaries’ Centre for Statistical Information. In her opinion, the growth in mortgage loans will be single-digit.

Asprima: “Very few new homes will be built”.

“I don’t think that the volume of transactions will increase by more than 10% and the forecast for price growth will be below 5%”, says Carolina Roca, Vice-President of Asprima. “The most important macro-factor is income”, she laments. Therefore, prices cannot rise by much, in her opinion, although they will increase in certain areas. “New builds will recover in 2018, but not by much (…)”.

Tinsa: “The reduction in the unemployment rate will boost the market”.

“The residential market will record moderate price growth in 2018 (of between 3% and 4%), similar to that seen in 2017, with different speeds, depending on the region”, says Pedro Soria (pictured above, bottom row, second from right), Commercial Director at the appraisal company Tinsa. “The recovery will expand to more areas; the large capitals will continue to be the drivers, although the rate of growth will soften”, he adds. “The reduction in the unemployment rate and continuing investor interest, due to the prolongation of the low-interest rates, will increase house sales by between 10% and 15% (…).

Sociedad de Tasación: “New house prices will rise by 5.4%”.

“Applying our predictive model to the data from the Ministry of Development, we estimate that 14.1% more house sales will be completed in 2018 than in 2017 (…)”, says Consuelo Villanueva (pictured above, top row, far left), Director of Institutions and Key Accounts at Sociedad de Tasación. “The result (…) indicates growth of 5.4% in the price of new homes under construction for the average of provincial capitals in 2018 (…)”.

Gesvalt: “Mortgage lending will rise by around 15%”.

“According to the forecasts at Gesvalt, we predict moderate growth in second-hand house prices of around 5% at the national level, although there will be notable differences between provinces”, says Sandra Daza (pictured above, bottom row, far right), Director General at Gesvalt. (…). And by how much will mortgage lending grow? “By around 15% and there will be a slight increase in the number of mortgages that exceed 80% of the total property value”.

Foundation of Real Estate Research: “The political uncertainty will weigh down on Barcelona”.

The President of the Foundation of Real Estate Research, Julio Gil, believes that house prices will rise by “between 0% and 5% in 2018. “We will move to a three-speed market”, he thinks, referring to consolidated areas, cities in recovery and provinces with a surplus supply and/or limited demand. “And I think that Barcelona will perform less well than Madrid, weighed down by the political uncertainty”, he adds (…).

Pisos.com. “Mortgage lending will rise by more than 10% for the fourth consecutive year”.

According to Ferran Font, Head of Research at Pisos.com (…) “Historically low interest rates and the decrease in unemployment mean that we expect mortgage lending to grow at double-digit rates in 2018, like it has done for the last three years”.

General Council of Real Estate Agents: “The rise in rents will lead to tension in sales prices”.

“House prices will grow by around 5% in 2018, driven more by the refuge effect of savings than by objective economic variables”, says the President of the General Council of Real Estate Agents, Diego Galiano. “Savings are not being rewards and housing is recovering a certain degree of stability and offering good prospects for investors (…)”.

TecniTasa: “Prices will grow by around 5%”.

“On average in Spain, we estimate price growth of around 5%, but we highlight that that figure represents an average of a very heterogeneous market, by area and asset class. In some regions and for certain types of high-end homes, the increase will amount to between 5% and 10%, and may even exceed 10% (for example, in the Balearic Islands). Whilst in small towns and for cheaper homes, prices are barely expected to rise at all in 2018”, says José María Basáñez, President of TecniTasa (…).

Civislend: “The mortgage war will intensify”.

“The growth that we will see in terms of mortgage lending is going to continue to reflect double-digit rates and the war in terms of granting loans by financial institutions is going to intensify”, says Manuel Gandarias, Director and Founder of the real estate crowdlending platform Civislend (…).

Acuña & Asociados: “80% of sales will be made in 400 towns”.

“Given the current situation, the expected growth in prices at the national level for 2018 will amount to around 5.5%”, forecasts Luis Rodríguez de Acuña. However, “demand for housing is not behaving in a homogenous way across the country, and transactions are only being recorded in 1,300 of Spain’s 8,125 municipalities”. In other words, in one out of every six. And 80% of transactions “are being closed in just 400 municipalities (…)”. (…).

CBRE: “The sale of new homes will continue to gain weight”.

The value of homes will increase “by around 5% YoY at the national level, with higher rises (between 7% and 10%) in certain markets such as Madrid, Valencia, Málaga and the Balearic Islands”, predicts Samuel Población (pictured above, top row, far right), National Director of Residential and Land at CBRE (…). “Sales of new build homes are going to increase their relative weight (with respect to second-hand homes) as a result of the recovery in construction output; nevertheless, the recovery will not have an immediate impact on transaction volumes given the time lag associated with new build developments”, he says.

BDO: The land market is preventing soaring construction output”.

“We are facing a very favourable macro context (GDP and employment, above all) and therefore, an upwards cycle is likely, which will have different regional rates”, explains Alberto Prieto, at BDO. (…). “The launch of new build projects by the new large players will start to be felt in 2018, and then more intensely in 2019”, he adds. “The situation in the land market makes it unfeasible for the volume of new build homes to soar for the time being”, he says.

Foro Consultores Inmobiliarios: “Fixed-rate mortgages will play an important role”.

Carlos Smerdou, CEO at Foro Consultores, believes that “new build homes will drive the market and that recent land transactions indicate that the trend in terms of prices will be upward, of between 5% and 10%” (…). In terms of fixed-rate mortgages, “they will play an important role”, despite the fact that “interest rates are forecast to remain negative”.

MAR Real Estate: “Banks are still reluctant to grant the necessary financing”.

Rosario Martín Jerónimo, representative of MAR Real Estate in Marbella, believes that house prices will grow by more than 5% in Spain this year, on average (…). Nevertheless, she does not think that sales or mortgage lending will be as high in 2018 as they were in 2017 and that the growth rates will remain below 10% in both cases. “Buyers are willing but the financial institutions are still very reluctant to grant the necessary financing”, she explains. “Many property developers are completely financing their projects using money from private investors/buyers, without any support from the bank”, she says (…).

uDA (urban Data Analytics); “Prices will rise by more than 10% in the large cities”.

“House prices will rise by around 6.9% in 2018, although the behaviour will be tremendously heterogeneous”, warns Carlos Olmos, Director of urban Data Analytics. In other words, there will be “some large cities with growth rates of more than 10% and many other capitals with small decreases” (…).

Gonzalo Bernardos, Professor of Economic: “House prices will rise by 11% and sales volumes by 23%”.

“I think that house prices will rise by 11%”, says Gonzalo Bernardos, Director of the Real Estate Masters at the Universidad de Barcelona (…). Moreover, in macroeconomic terms, it is the best scenario for the residential market: high (economic) growth (around 3%), the creation of employment, scarce new build supply (new build permits will amount to 125,000 in 2018), very low interest rates and bank willingness to grant mortgages”. “House sales will rise by around 23% and mortgage lending will increase by 17%”.

Irea: “House prices will rise by more than 7% in consolidated markets”.

Mikel Echavarren (pictured above, bottom row, far left), CEO of the real estate consultancy and advisory firm Irea, forecasts that house prices will rise by between 5% and 10% in 2018 with respect to 2017. “In consolidated markets, the increases will be closer to 7%”. (…). In the mortgage market (…), “in theory, financing conditions will continue to be very beneficial for buyers and property developers”, he adds.

College of Registrars: “Mortgage lending will grow by around 20%”.

The registrars believe that house prices will rise by less than 5%. “Taking into account our data and the slowdown that is already being seen in Cataluña, which accounts for approximately 17%-18% of the Spanish housing market (…), we think that it will be hard to exceed a growth rate of 5% in 2018”, explains Fernando Acedo Rico, Director of Institutional Relations at the College of Registrars. (…). Something similar will happen with mortgage lending, which “will continue to grow at around 20%”.

Idealista.com: “Madrid will drive the price rises”.

According to Fernando Encinar, Head of Research at the real estate portal Idealista, house prices will rise by less than 5%. (…). “There will be cities that will experience a more acute recovery, such as Málaga, Valencia, Sevilla and the islands. But I think that Madrid is going to be the real driver, with even more accelerated price growth”. Why? “The Spanish capital is gobbling up talent and investment, and demand there indicates that prices are going to continue to rise. There is minimal stock left in Madrid (…)”.

Instituto de Práctica Empresarial: “In 2018, 550,000 homes will be sold in Spain”.

According to the Director of the Real Estate Chair of the Instituto de Práctica Empresarial, house prices will rise by 6.1% in 2018 (…). In Spain, 550,374 homes will be sold, which represents 14.5% more than in 2017, despite the sluggishness that may be seen in Cataluña.

Invermax: “Tourist areas may see price rises of 10%”.

Jesús Martí, Real Estate Analyst at Invermax, thinks that “house prices will grow by another 5%, with this average varying between the large cities and the traditionally touristy coastal areas, where they may rise by 10%”. “It is still a good time to buy a home, especially for investors”, he adds (…).

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

Tinsa: House Prices Rise By 21% & 16% In Barcelona & Madrid In 1 Year

2 October 2017 – El Mundo

The housing market is continuing its gradual recovery across the country, although there are notable differences in the pace of growth depending on the area. Whilst the YoY average growth in prices is contained at the national level (4%), in the cities of Barcelona and Madrid, prices are soaring, according to provisional data from the IMIE Local Markets index published by the appraisal company Tinsa for the third quarter 2017. Specifically, house prices rose by 20.6% in the Catalan capital and by 15.5% in Madrid.

Tinsa reports that the cost of finished homes (new and second-hand) reached an average of €1,258/m2 between the months of July and September, up by 4% compared to the same period in 2016. The cumulative decrease since the pre-crisis peaks has therefore reduced to 38.6%, on average.

“The market continues to be characterised by a recovery at different speeds, with an overall positive trend, driven by the good prospects for economic growth and with the cities of Barcelona and Madrid as the main drivers of the recovery. In recent months, we have seen how other large regional capitals, such as Valencia and Sevilla, have been experiencing a positive evolution in terms of prices, whereas Zaragoza has been falling somewhat behind”, said Jorge Ripoll, Director of Research Services at Tinsa.

Ripoll said that the situation is characterised by stabilisation in most markets, given that average prices in 13 regional capitals are now lower than they were in Q3 2016. “The number of cities in that situation has decreased with respect to the previous quarter, along with the intensity of the decreases, which are becoming more moderate in general”, he said.

The same outlook at the autonomous level

The Community of Madrid, with a YoY increase of 13.2% and Cataluña (12.5%), stand out as the regions where average house prices have risen by the most over the last 12 months, way ahead of Navarra (6.6%), Cantabria (5.7%) and the Canary Islands (3.3%). At the other end of the spectrum, Extremadura (-3.3%), Castilla-La Mancha (-3.2%) and Murcia (-2.8%) are the regions that lead the price decreases in YoY terms.

If we look at the evolution of prices in 2017 alone, the Community of Madrid recorded an increase of 10.7% between January and September, compared to 8.9% in Cataluña. The region of Madrid, with an average price of €2,004/m2, strengthened its position in Q3 as the most expensive autonomous region, ahead of País Vasco (€1,931/m2), which was also outperformed in Q3 by the Balearic Islands (€1,953/m2).

The regions that record the highest difference in prices with respect to the peaks of the boom are La Rioja, where the average value is 56.1% lower than 10 years ago, followed by Castilla-La Mancha (-53.7%) and Aragón (-49.8%). The regions where average prices have been the most contained since the crisis are the Balearic Islands (-28.4%), Galicia (-32%) and Extremadura (-32.2%).

Barcelona is the most expensive city

Barcelona saw its price gap with San Sebastián widen, as prices in the Catalan capital reached €3,184/m2 compared to €2,997/m2 in the Basque capital. Both still ranked ahead of Madrid (€2,488/m2) and Bilbao (€2,204/m2) (…).

Other capital cities that recorded significant rates of YoY growth in Q3 include Tarragona (13.4%), Vitoria (10.3%), Palma de Mallorca (9.3%), Pamplona (9.1%) and Málaga (7.6%).

Original story: El Mundo

Translation: Carmel Drake

Tinsa: Residential Land Prices Rose By 4.1% In Málaga In Q2

17 July 2017 – Diario Sur

The housing sector in Málaga is continuing to grow. The price of residential land in the province rose by 4.1% during the second quarter of this year compared to the same period last year, to reach €1,399/m2, which is €154/m2 higher than the national average, according to data from the appraisal company Tinsa. It represented the highest increase in Andalucía and the sixth highest in Spain as a whole; and it consolidates the upward trend seen over the last two years, a situation that has generated concerns about the possibility that the sector is heading towards a new real estate bubble.

The Director General of the Institute of Business Practice (IPE), José Antonio Pérez, said that, for the time being, the growth is “sustainable”, although he warned that the lack of buildable land on the Costa del Sol to meet the current demand from property developers and investors will limit this trend and may lead to a disproportionate rise in prices in some enclaves. Pérez attributes the lack of supply to “restrictions” imposed by the general urban planning orders in certain municipalities and the slow pace of urban planning procedures. (…).

Tinsa’s report also reveals that the average mortgage granted to Malagan households amounts to €126,815, the seventh most expensive in the country, with a monthly instalment of €592. The percentage of household income spent on paying the first year of a mortgage is 27.6%, almost eight points above the national average (19.9%). The appraisal company highlights that this statistic makes Málaga the province where families spend the highest percentage of their income on mortgage repayments, above the Balearic Islands and Barcelona (21%).

Málaga also leads the list of provinces with the highest number of house sales closed in the last four months, with respect to the size of its housing stock: 32.1 for every 1,000 homes. It was followed by Alicante and the Balearic Islands, which also have “a clear tourist component”, said the report. The appraisal company reminds its readers that the province is home to “a large number of high-end homes” aimed primarily at foreign buyers, which put upward pressure on average house prices.

By contrast, the IPE considers that it is “a mistake” to draw conclusions at the provincial level “because you cannot compare the situation in Villanueva del Trabuco, for example, with that of Marbella”. The institute, which specialises in the real estate sector, highlighted the sea fronts and golden triangle formed by Marbella, Estepona and Benahavís as the areas where demand for residential land is highest, as well as the capital, where Limonar and Valle del Guadalhorce are positioning themselves as the new enclaves for future urban development.

House sales

The Real Estate Pulsometer compiled by IPE confirms that Málaga is seeing one of the strongest recoveries in the sector, together with Madrid, Barcelona and the Balearic Islands. Investors, savers, funds and individuals comprise current demand, which caused house sales to grow by 6% last year; and a similar rise is forecast this year. Currently, half of all purchases are paid for in cash and the other half are financed through mortgages (…).

Original story: Diario Sur (by Alberto Gómez)

Translation: Carmel Drake

ST: House Prices Will Rise By 3% In 2017

18 January 2017 – Cinco Días

House prices will grow by 3% on average this year, driven by the improvement in the economy and employment, but also by the pseudo boom that is happening in the rental sector, in particular in large cities. That is according to Sociedad de Tasación, one of the largest appraisal companies in the sector.

The year that has just started will continue to be favourable in general terms for a real estate sector that, in the words of the Director General of Sociedad de Tasación, Juan Fernández-Aceytuno, is “recovering its sense of judgement”.

Thus, the volume of transactions will continue to grow, the rate of construction will intensify and more mortgages will be signed (although that figure will always fall below the number of house sales); and all of that means that house prices will end the year 3% higher, on average. Nevertheless, Sociedad de Tasación warns against certain risks and key factors that will determine the extent of this improvement in the real estate sector.

The first is what is happening in the rental market. Fernández-Aceytuno again highlighted the large group of potential buyers, such as young people aged between 25 and 35 years old, who are unable to buy a home because of their low wages and because of the precariousness associated with the majority of the new jobs that are being created. Since those people are not buying, many are choosing to rent, which has caused demand in the rental market to soar, along with rental prices. Sociedad de Tasación believes that if no response is given to this insolvent demand, rental prices will continue to rise and that will, in turn, drive up the prices of homes up for sale.

The Director General recalled that the average yield on rental properties in large cities stands at around 6.1% at the moment, which means that the increase in real estate prices in the major cities will be higher than the 3% forecast for the country as a whole.

Moderate pace

Other decisive factors, in addition to the improvement in employment, will be everything relating to financing. The new accounting standards, which the banks must comply with this year, together with the cost of recent court rulings, such as the judgement regarding floor clauses, and the forecast increase in interest rates may have an impact on the conditions for accessing credit over the medium term, which will determine the behaviour of much of the demand.

In any case, the good news, according to Socidad de Tasación, is not only that the main indicators in the sector are going to continue to stabilise, but also that they are doing so in a much more balanced way than in the past. In this sense, the firm gave the example that house prices are growing at more moderate rates now than they did during the previous boom, with rises in line with the number of new Social Security members. Moreover, it highlighted that land prices have not soared by more than house prices, which was also common during the early 2000s.

What’s more, property developers have not started to build homes in an uncontrolled way, even despite the expectation that more new homes are going to be sold. A study compiled by the appraisal company shows that the supply of new homes in Madrid and Barcelona is actually scarce, which means that it will run out within 10 months in the capital and within 14 months in Barcelona. Finally, it describes the rate of property construction along the coast as “very reasonable”.

Original story: Cinco Días (Raquel Díaz Guijarro)

Translation: Carmel Drake

ST: New Home Prices Rose In Every Regional Capital In 2016

4 January 2017 – Expansión

According to Sociedad de Tasación, the price of new homes rose by 3.3% in 2016. It is the largest increase recorded since 2007 when, at the height of the real estate bubble, they rose by 5.1%. The price of new homes rose in every provincial capital and, for the first time since the crisis, “the rising trend was completely generalised”. Nevertheless, the price rises were moderate in almost every city. They only really stood out in Barcelona, with an increase of 6% and in Madrid, with a rise of 4.9%. Both cities continue to be the engines of growth in the sector.

The average price of new homes in Spain’s provincial capitals amounted to €2,120/m2 in December 2016 (up by 1.9% compared to the previous half year). The value of a typical 90. m2 home in the provincial capitals rose to €190,800. In other cities that are not provincial capitals, the average price of new homes amounted to €1,555/m2 in December, down by 26.6%.

“We think that 2016 was the year during which prices bottomed out, the cycle changed and the sector moved from stability to recovery, supported by price increases, transactions, the reactivation of off-plan house sales, the granting of mortgages and a decrease in the default rate. That makes us think that 2017 could be a good year for the real estate sector”, said Juan Fernández Aceytuno, Director General at Sociedad de Tasación.

Although all of the capital cities have left their losses behind, we are still seeing a two speed recovery in the residential sector. On the one hand, we have the large centres of demand and the tourist areas. On the other hand, we have the areas with the highest volumes of surplus new homes for sale, which still have several years of property digestion activity ahead of them. (…).

More confidence

The index of confidence in the evolution of the real estate sector that Sociedad de Tasación compiles stands at 54.5 points and is continuing to rise from its neutral position of 50. This means that the indicator has grown by 10 points in two years, from 44.5 at the end of 2014. La Rioja (57.9), the Balearic Islands (57.9) and Madrid (56.9) have the highest confidence indices. Castilla-La Mancha (50.9), Castilla y León (50.8) and País Vasco (49.3) have the lowest.

Meanwhile, the appraisal company’s real estate effort index amounts to 7.4 years salary for the acquisition of an average home. The Balearic Islands is once again the autonomous region where buyers need the longest time to acquire a home – 15.8 years – and La Rioja the region where buyers take the least time – 4.6 years.

Most buyers are not new households, but demand is being nourished, above all, “from investors, in particular from people looking to buy to rent or reposition themselves”, according to the Director General of the appraisal company. As such, “the challenge is to analyse in detail the demand and understand why the cohort that makes up the sociodemographic profile aged between 25 and 35 years are not buying homes at the moment”, says Fernández Aceytuno. “It may be due to job instability, wages, geographic mobility, sociodemographic changes…but really, it is more important that we analyse who are not buying homes than who is”, he added.

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

How Long Does It Take To Sell A House In Spain?

21 June 2016 – Cinco Días

The improvement in the economy, the credit recovery and the belief that discounted house prices have come to an end are all driving up house sales. In fact, several studies agree that it now takes just 10 months to sell a home, on average, when in 2013 it took more than a year. What’s more, in April, homes in good locations with reasonable prices in Madrid and Barcelona were sold within 30 days.

The three major indicators of the real estate market: price, sales and construction have been reflecting an improvement in the sector for months now, and in some cases for years. But another way of taking the pulse of this activity is to look at how long it takes to sell homes, on average. For the time being, the only figures available are provided by private companies operating in the market, such as the appraisal company Tinsa, and the real estate portals Idealista and Fotocasa.

Care should be taken because the results depend on the methodology used in each study, and given that we do not know what happened in terms of average sales periods before 2010, the reality is that all of the cases indicate the same trend: it takes less time to sell a home now than it did a year ago.

The appraisal company Tinsa has been preparing its study for just four quarters (its figures for Q2 2016 are due to be published within the next few days). It obtains its data by cross-checking the volume of supply and demand for homes in all of the provincial capitals and in the country’s five major cities: Madrid, Barcelona, Valencia, Sevilla y Zaragoza. Two conclusions stand out from its finding.

The first is that, on average, during the first quarter of this year, it took 10.5 months on average to sell a home in Spain, slightly less time than during the previous quarter (10.6 months). Although, we should keep in mind that the start of the year tends to be the quietest time for house sales, which could also affect the average sales period.

The second aspect…is the disparity in average sales periods by region. Whilst in some parts of the country, average sales periods are pretty stagnant and have barely experienced any changes in four quarters, either up or down; in other areas, there has been a clear upwards or downwards trend (homes are being sold more quickly or it is taking longer to complete sales, respectively).

In the ranking by province, for example, Madrid stands out because it now takes just seven months to sell a home there; meanwhile, in Cantabria, the autonomous region with the longest average sales period, it takes 19 months to sell a home, almost triple the period reported in Madrid. Other regions at the top end of the ranking include: the two Canary Island provinces, Badajoz and Zaragoza. Whilst, at the other end of the scale, as well as Cantabria, we have Ávila, Álava, Segovia and Ciudad Real, amongst others. The large cities that complete the appraisal company’s study all have a common denominator: they are the areas where average sales periods are decreasing the most quickly.

Meanwhile, Fotocasa’s figures are prepared based on a survey of owners with homes up for sale. Its latest figures relate to 2015 as a whole. Its findings show that it takes 10.6 months to sell a home on average…well below the maximum peak of 13.2 months reached in 2013. In addition, it breaks down the supply by tranches and concludes that last year, just 15% of the homes that were bought had been on the market for more than 24 months.

Finally, recent analysis performed by Idealista shows that in April, 20% of the homes sold in Madrid and 15% of those sold in Barcelona found a buyer within less than a month. (…).

Original story: Cinco Días (by Raquel Díaz Guijarro)

Translation: Carmel Drake

Tinsa: Holiday Home Prices Rises Spread Along The Coast

15 June 2016 – El Mundo

Holiday home price increases have spread to more than twice the number of municipalities that they were seen in last year, with the Costa del Sol, Alicante, Balearic and Canary Islands enjoying the most active markets. Meanwhile, Castellón, the Cantabrian coast, Menorca and La Palma are still seeing price decreases/stabilisation. Those are the findings of the Coastal Homes 2016 report prepared by Tinsa, which shows that prices increased in 71 of the 136 municipalities analysed along the coast during Q1 2016, compared with 35 in 2015 and 4 in 2014.

The appraisal company explained that although this trend, “which is more in line with a stabilisation phase than a clear recovery” is spreading “gradually”, the coastal market is still “very heterogeneous”, given that prices in certain locations are still decreasing at an annual rate of more than 5%. The company added that the most repeated pattern is the absence of construction as well as of transactions involving land. (…).

By municipality, the towns of Teguise and Tías, in Lanzarote, recorded the highest YoY price rises during the first quarter, with increases of 17.8% and 14%, respectively, according to provisional data from Tinsa’s appraisals. They were followed by Gavà (Barcelona) and Benicarló (Castellón), both of which saw an increase of 13.2%, and Blanes (Gerona), where prices rose by 12.8%, with respect to Q1 2015.

The largest decreases were recorded in Piélagos (Cantabria), where the average price fell by 16% over the last 12 months; Antigua (Fuerteventura), down by 12.6%; and Los Alcázares (Murcia), with a decrease of 10.6%.

Price decreases of more than 50%

Similarly, the report shows that the Spanish coast accounted for a large majority of the highest price decreases during the crisis. Of the municipalities analysed, the most intense reduction since 2007 was recorded in Mataró (Barcelona), where the average price has decreased by 59.8% since the height of the boom. (…).

Stable outlook

Tinsa’s forecast for the next few months is characterised by stabilisation. Tinsa expects prices to remain stable in just over half of the regions analysed in its report and for prices to rise in just over a third of the areas. This forecast for improving prices focuses primarily along the coast of Valencia Alicante, Málaga, Palma de Mallorca, Canary Islands and San Sebastián, as well as along some stretches of the coast in Gerona, Barcelona, Cádiz and Asturias.

In terms of the supply of holiday homes, the report notes that it mostly comprises second-hand properties. The stock generated in recent years as a result of the slowdown in financing and sales is gradually being absorbed.

Moreover, Tinsa’s technical network classifies the over-supply of holiday homes as “very abundant” in just 8 of the 55 regions. These include the northern coast of Castellón; the Manga del Mar Menor; the west of Almería; the south of Barcelona; the central stretch of the Tarragona coast; the western region of Cádiz and the eastern coast of Vizcaya.

To evaluate the degree of difficulty in terms of stock absorption, Tinsa concludes that the current stock is “manageable in the short term” in 56% of the regions. This group includes the coasts of the provinces of Girona, Valencia, Huelva, Granada and San Sebastián, as well as Ibiza, Fuerteventura and Lanzarote, and most of the provinces of Alicante, Murcia and Cádiz. (…).

Original story: El Mundo

Translation: Carmel Drake