Tag: families

Ibiza’s Real Estate Market is a “World of its Own”

11 July 2018 – Diario de Ibiza

The real estate market in Ibiza is not encouraging (for the majority): the available stock of homes “is residual”, the majority of homes bought there are rented out, the peak prices reached in 2017 have been exceeded…and all of this is being compounded by a distinct shortage of land. All in all, it is a troubling scenario for those wishing to live on the island all year round.

Tinsa’s Regional Director for the East and South of Spain, José Antonio López, warned on Wednesday that the lack of land, combined with the demand for housing “is generating a dangerous melting pot” in the Balearic Islands. As such, he is asking the administration to get involved to facilitate the availability of land for property developers.

Those were the words used by López in response to a question from participants at a Proinba-Tinsa real estate meeting held in Palma on Wednesday, where the situation of the residential real estate market was discussed, in particular, the market on the coast.

López warned that this situation may “lead to serious problems” on the islands, where “young people need primary residences” and they “need options”. “For this reason, land is required, and the administration needs to get involved”, said Tinsa’s Regional Director, before adding that the supply of urban land with building permission is “almost non-existent”.

What’s more, “the supply is going to decrease” and with the “surplus demand”, we are seeing “dangerous growth that cannot be met”. In this context, “rental is not an option because those circumstances are also being taken advantage of”. In fact, according to data from Tinsa, in areas such as Ibiza (town), many people are buying to let (…).

Based on data from Tinsa, the average monthly mortgage payment on the Balearic Islands is very high, €792, well above the average for Spain as a whole, €543/month. The financial effort being made by families on the islands is also greater, given that they spent 22% of their household income on mortgages during the first year, compared with the national average of 16.8%.

Ibiza and Formentera set a new record

Of the 12 coastal municipalities analysed on the Balearic Islands, Sóller leads the increase in prices over the last year, with price rises of 21%. Ibiza and Formentera towns came in close behind, with 17.8%, followed by Santa Margalida (17.7%), Palma (14.7%) and Llucmajor (13.8%).

Palma is one of the top five most expensive capitals in Spain, with an average price of €1,951/m2, and in the last year, its growing trend has exceeded the average for the autonomous region.

By contrast, the municipalities that have grown by the least are Sant Lluís and Mahón (3.7%), Ciutadella (4.5%) and Manacor (7.1%) (…).

Ibiza is “recovering too quickly”

According to data from Tinsa, the real estate sector on the coast in Mallorca is “clearly recovering”, whilst in Menorca, there are “signs of recovery” and in the case of Ibiza, there may even be an “excessive recovery”, in López’s opinion.

Prices have been “rising rapidly” on the white island, on a consistent basis for the last few years, and the YoY variation is well above the average. In fact, current prices have already exceeded the maximums seen in 2007.

On the basis of all of these indicators, the Regional Director at Tinsa said that Ibiza’s real estate market could be considered “a world of its own, set apart from other islands and provinces” (…).

Original story: Diario de Ibiza (by E.P.)

Translation: Carmel Drake

No Buildable Land Left in ‘Sevilla Este’ After Fund Shopping Spree

16 January 2018 – Sevilla ABC

The supply of land in Sevilla Este has almost run out. And that milestone represents more than just a symbolic fact. It is a clear sign that a new cycle of real estate expansion is underway, characterised by significant interest from property developers in neighbourhoods and towns on the outskirts of Sevilla. It also provides evidence of the shortage of buildable land that exists in the municipality of the provincial capital, which has caused the few plots of buildable land that have come onto the market to spark a great deal of interest amongst investors.

Whilst the property sector started its rebirth in certain parts of the city centre in 2015, interest in other areas of the city has been increasing significantly over the last two years to meet the new demand that is being generated by the growth of the economy. The result of this trend is that in just three months, almost all of the residential plots in the Sevilla Este area have been sold.

“With just a few exceptions, everything that was on the market has now been purchased”, along with plots that still need to be developed for public and social services, explains Juan Aguilera, Manager at Gaesco, speaking to ABC.

And this investor boom in that area of the city is due to the fact that “Sevilla is running out of buildable land for new developments, since vital infrastructures such as the SE-35 ring-road have not been built, which is the main artery that ought to be boosting all of the new areas of metropolitan expansion”, says Aguilera (…).

Q21’s investment

The most recent large land operation in Sevilla Este was carried out by Q21 Real Estate, the property developer that emerged from the merger between the US investment fund Baupost and the Spanish company Grupo Pinar (one of the most recognised firms in the former property sector). That company has acquired a plot measuring 5,400 m2 at the end of Avenida Emilio Lemos, opposite the Aleste Plaza shopping centre, where it will build around 164 homes. The company is currently processing the permits it requires to start the building work and, once it has received the green light, will complete the construction of the properties within a period of 26 months. The plot that Q21 has acquired belonged to another company in the sector that filed for bankruptcy.

That purchase operation took place at the same time as two other large investments in Sevilla Este, also made by companies that are partly owned by large investment funds. One of them was led by Vía Célere, in which Värde Partners owns a majority stake; it acquired a plot for the construction of 1,700 homes that had belonged to BBVA. And in parallel, the fund Activum purchased plots for the construction of more than 1,000 homes (…).

In Aguilera’s opinion, the interest from these investment funds in Sevilla Este has arisen because several factors have converged. “There is significant built-up demand in Sevilla from families who chose to rent during the crisis and who are now interested in buying a home, plus the years of recovery are now creating new families who can also afford to buy one of these new homes”. This demand, combined with the shortage of buildable land in Sevilla, is what has caused the interest in Sevilla Este to soar, which is exactly what already happened with Hacienda Rosario (which used to belong to Gabriel Rojas and which was acquired by Aedas Homes).

Interest in Entrenúcleos

In these circumstances, Aguilera considers that future real estate investments will not be made directly in Sevilla, but rather in the some of the population nuclei of the metropolitan area, especially in Dos Hermanos (which has made the effort to develop an area like Entrenúcleos).

Aguilera thinks that, unfortunately, time has proved him right. “If we had done our homework, we would now be enjoying a great period for the reactivation of large residential projects: demand and the economy are growing, financing is available at very reasonable prices…but none of the areas that require the SE-35, like Higuerón Norte, Buen Aire, San Nicolás Oeste and Villanueva del Pìtamo, have the infrastructure they need to capitalise on this new construction boom” (…).

Original story: Sevilla ABC (by Luis Montoto)

Translation: Carmel Drake

Aedas Homes Unveils its Plans for Hacienda del Rosario (Sevilla)

8 January 2018 – ABC Sevilla

A new neighbourhood with more than 1,000 homes for families aged between 30 and 45 at affordable prices. That is the project that is now being built in Hacienda del Rosario, right opposite the Decathlon store and next to the Parsi Industrial Estate. The aim is to develop the city’s urban planning project and recover the demographic indices last seen a decade ago.

The Aedas Homes group is going to build 1,046 two-, three- and four-bedroom homes in seven 10-storey towers over a surface area of 93,000 m2, of which 73,000 m2 will comprise green space. And the Town Hall is going to build another 218 social housing properties on an adjacent plot, owned by the Urban Planning Department, which Emvisesa has already started to process. That means that by the start of 2019, Sevilla will have a new district with more than 2,000 homes, including not only these projects but also the one in Santa Bárbara.

On Monday, the mayor, Juan Espadas, visited the site where Aedas – which is also responsible for the Cisneo Alto project and the new Ramón y Cajal urbanisations – is starting work on land that it purchased in 2016 from Gabriel Rojas in the East of the city. Specifically, the plots are located between the A-92 and the shopping centre that houses the aforementioned Decathlon store. The access roads have already been built and the Town Hall has granted the relevant licences for the construction of the residential areas, which will include a park measuring seven hectares, a social club and common areas with a swimming pool and padel courts.

For Espadas, “this project is not simply a housing development, but rather the creation of a new neighbourhood in Sevilla, which means that we are at the beginning of the post-crisis and we have left behind the black hole in the construction sector”. The area of expansion is destined for “established families who want a more comfortable environment at a good price”, explains the mayor. The regional director of Aedas, Diego Chacón, highlight that these homes will cost between €120,000 and €150,000, and will be financed by Banco Santander and constructed by San José. The first tower, which will have 142 homes, will be handed over within a year. And from then, the area will come to life continuously in search of a clear objective that the major himself has admitted: “The registration of citizens (‘empadronamiento’) in the city will be activated again”.

Original story: ABC Sevilla (by Alberto García Reyes)

Translation: Carmel Drake

Price Rises Continue To Rock Spain’s Rental Home Sector

6 June 2017 – El Mundo

The housing market is trembling and not, like in the past, because of the high degree of sale and purchase activity. The residential sector in Spain is facing an unprecedented phenomenon: a boom (not a bubble) in the rental sector. In a short space of time, this residential regime has gone from being almost residual to accounting for more than 20% of the housing market. And that figure is rising. This leap is driving up prices, significantly. Above all in Madrid and Barcelona.

According to the experts, a change in the mentality of young people and employment mobility are the main factors driving this formula for accessing a home. (…).

Not since the 1960s has the percentage of rental properties been so high in Spain, but, despite the increase, the figure is still well below the levels seen in other European countries – which reach 50% in some places – although it is moving closer to the Eurozone average – 30%. (…).

The cornerstone of this growth in rental properties has been the spectacular boom in demand, which has come up against an unprofessionalised sector, with minimal supply owned, primarily, by individuals. The real estate portal Fotocasa now registers more searches for property rentals than it does for property purchases. The result of this imbalance? An earthquake in terms of prices. How long will this earthquake last? Where are its epicentres? What intensity will it reach? What measures should be taken to soften its effects? (…).

The latest evidence of the rental earthquake has come in the form of the Fotocasa’s price statistics for April, which show that the average rent in Spain rose by 10.2% in one year, to €8.04/m2/month. That cost takes the market back to its 2011 levels but it is still well below (-20.7%) the peaks of 2007 (€10.12/m2/month). (…).

“It is a question of supply and demand”, said Economist and Director of the Masters in Real Estate Development and Management Advisory at the Universidad de Barcelona (UB), Gonzalo Bernardos. “Demand is increasing due to the recovery. There are more jobs and, therefore, more families and young people as potential tenants. By contrast, the supply is decreasing (…)”. In his opinion, this situation will change when the banks start lending again en masse to families who earn less than €2,500/month. “From then on, maybe from 2018 onwards, the rental sector will suffer, as demand will transfer to the purchase market”, he said. (…).

Fotocasa has prepared a seismic map of the rental market. It reveals the evolution of rental prices by autonomous region. Prices decreased in YoY terms in Galicia only (in April) (by -0.7%), whilst they rose in all of the other regions, with marked rises in Cataluña (17%), Madrid and the Balearic Islands (12.1% in both). Together with the Canary Islands (11.9%), these regions are undoubtedly the large epicentres of the increase in rental prices.

“The increase in rental prices is happening across the whole country, but the strong average increase is due to Cataluña and Madrid”, said Beatriz Toribio, Head of Research at Fotocasa. “According to our Real Estate Index report for 2016-2017, these two regions account for 43% of the activity relating to demand”, she said.

In absolute terms, the most expensive rental prices are also in Cataluña, where the price per m2 stands at €11.96/month. In other words, a typical apartment measuring 90 m2 costs around €1,075/month. Next in the ranking, and still in the double digits, are Madrid (€11.36/m2/month), País Vasco (€10.59/m2/month) and Baleares (€10.05/m2/month). These values are even higher in the main municipalities.

Barcelona – the great tip of the iceberg

(…). In the city of Barcelona, the average rental price amounts to €15.14/m2/month. That amount is higher than the figures registered in Sant Cugat del Vallés (€13.61/m2/month) and Castelldefels (€13.58/m2/month), the next two most expensive towns for rental properties in Spain. In Madrid and San Sebastian, rental prices stand at €12.81/m2/month and €11.96/m2/month, respectively. (…).

The analyst at Fotocasa thinks that rental prices will regulate themselves over time. “We are still well below the peaks. The market is normalising”, she concludes. Meanwhile, Bernardos predicts that the rate of growth in rental prices will gradually calm down in Barcelona and Madrid. He forecasts price rises of 12%, 9% and 5%-6% over the next three years in the capital and of 8%, 5% and 3%-4% in Barcelona. (…).

Original story: El Mundo (by Jorge Salido Cobo)

Translation: Carmel Drake

Gov’t Says RE Recovery Is More Intense Than Expected

30 May 2017 – El Mundo

The Secretary of State for Budgets and Expenditure, Alberto Nadal, has highlighted that the growth of the economy in Spain is being favoured not only by the country’s exports, but also by the recovery of the construction and real estate sectors, which is proving to be much more intense than the Government had expected.

Those were the declarations made by the Secretary of State during the presentation of Inmonext 17, an event organised by Idealista in the context of Madrid’s International Real Estate Fair (SIMA) 2017, where he noted that GDP growth this year is set to exceed the official forecast of 2.7%.

During his speech, Nadal emphasised that this increase in growth is being supported by exports, which will continue to be very strong and by the recovery of the construction and real estate sectors. “The coffers don’t lie, people don’t pay taxes if they don’t have any cash”, he added.

In this sense, he said that the real estate sector is going to play a fundamental role in the growth of Spain and he reminded his audience that the sector was oversized during the years prior to the crisis and that real demand for housing was not well founded because prices were growing and the volume of credit exceeded the borrowing capacity of families. “Economic growth was unbalanced and was heavily concentrated in the real estate sector”, he said.

In his opinion, a reasonable cruising speed would be the creation of 50,000 homes per year and he added that the recovery is reaching the real estate sector later than other markets, perhaps because it was oversized before. For this reason, he said that the logical thing would be for the sector to operate at a reasonable average, leaving behind the extremes seen before the crisis and over the last few years.

Nadal said that the data shows that there is not a bubble now and he emphasised that the outlook of the Spanish real estate sector depends on the faith that Spaniards have in the future, especially in their jobs and salaries.

Original story: El Mundo

Translation: Carmel Drake

Ministry of Development Invests €870M In Housing Plan For 2017

23 November 2016 – Expansión

Yesterday, the Minister for Development, Íñigo de la Serna, announced in the Senate that the State Plan for Housing and Refurbishment 2013-2016, which is due to expire at the end of this year, will be extended for another year. The Government is finalising a Royal Decree to avoid “the subsidies for housing being suspended from 1 January”, said De la Serna. Thanks to this extension, which the Council of Ministers will approve over the coming weeks, the number of families receiving subsidies of up to €200 to pay their rent will increase to 100,000.

The ministry was unable to provide details about how many recipients currently benefit from the Plan, but the initial objective was to cover the needs of 200,000 families. So far, it has not managed to help even half that number, but that is the aim for next year.

The commitment to subsidise rental payments instead of awarding social housing was very well received by all social agents, as well as by the opposition party. Through the State Plan, the Ministry of Development pays for between 33% and 40% of the monthly rent of households with incomes of less than €22,365 per annum who rent homes for less than €600/month.

During the Government control session in the Senate, the Minister revealed that this one-year extension will allow the Ministry of Development to allocate more than €321 million to rental and refurbishment projects in 2017. Moreover, almost €90 million will be contributed by the regional governments in the form of co-financing and €458 million will be provided through induced private investment, taking the total investment to almost €870 million.

“The extension of the term will not only help lots of families pay their rent, but also will continue to incentivise participation in the private sector and create business opportunities, which will result in the generation of employment and, therefore, also in new resources for the State”, said the Minister. In fact, next year, “35,000 homes will be refurbished or renovated”, which will create 13,000 jobs, said De la Serna.

In parallel, more than 70,000 families will continue to receive help with their mortgage payments to acquire social housing properties in 2017. Another €150 million will be allocated to that cause.

The Minister also announced that the Sectoral Housing Conference will be convened on 15 December with all of the autonomous communities, to start to prepare a State Plan for the period 2018-2021. De la Serna said that this will be “the fruit of consensus and dialogue” not only with the autonomous governments, but also with agents, associations and other players in the sector. (…).

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

Bankia & Santander Lead Decrease In Mortgage Default Rate

12 September 2016 – El Economista

The economic recovery is substantially easing the burden of provisions that the banks are making against their non-performing loans. The volume of bad debts have been decreasing gradually over the last few months, thanks to the overall improvement in the financial circumstances of families and companies.

An important part of this respite is coming from the mortgage segment. Families now hold financing to acquire homes amounting to just over €525,000 million in total. Unemployment, which wrought havoc during the crisis, had increased the default rate to more than 6%. But that trend changed at the end of 2014. Since then, the default rate of these types of loans has decreased to 4.7%, on average. In other words, the volume of mortgages with delayed repayments has decreased to €25,000 million.

Not all of the banks have managed to benefit in the same way from the improvement in Spaniards’ fortunes. Bankia and Santander are the entities that have benefitted the most over the last year. Between June 2015 and June 2016, Bankia’s default rate decreased by almost a quarter, from 6.76% to 5.02%, and by nearly a half since its historical peak in 2014. Even so, the absolute percentage of the nationalised group still exceeds the system average.

The decrease in Bankia’s default rate has come at a time when the bank is significantly reducing the volume of loans it grants to acquire homes. In the case of Bankia, the cut in the volume of financing is similar to that recorded in the sector. It has decreased by 4.3% in twelve months (…).

Since 2012, the nationalised group’s strategy has involved rebalancing its credit portfolio, with a drop in mortgages and an increase in loans to SMEs and individuals.

In the case of Santander, the default rate has decreased by 0.81 percentage points to 4.59% over the last twelve months, allowing the bank to maintain a ratio that it slightly lower than that of its rivals. In 2013, the Cantabrian entity’s default rate (6.7%) exceeded the sector average. Since then, the decrease has been gradual.

The group chaired by Ana Botín has also reduced its portfolio of doubtful debts, whilst its volume of mortgages has decreased by 3.4%. In fact, of the major entities that have published their data so far, Santander and Bankia are the ones that have reported the most significant decrease in financing.

Three banks, BBVA, CaixaBank and Ibercaja, have gone against the trend in the sector, suffering slight increases in their respective default rates. The first has been hurt by the incorporation of Catalunya Banc in April 2015, which is leading to an increase in its impairments, even through the operation to acquire the entity excluded the most harmful mortgages. They were transferred to a fund owned by Blackstone with certain government guarantees provided by the public rescue fund (Frob).

Despite the increases, CaixaBank and Ibercaja have two of the lowest default rates in the sector. In both cases, the default rate of home loans to individuals fell below 4% at the end of June this year.

For most entities, the volume of loans are falling at rate of less than 2%, as a consequence of the boost in new business and the open war to secure clients. At Unicaja, the decrease has been less than 1%.

Market share

BBVA is still the leader of this segment, with more than €89,437 million loans granted to households to buy a home, representing a market share of 17% (…). It is followed by CaixaBank, with financing lines amounting to €88,557 million (17%) and Bankia with €62,200 million (12%). Santander is ranked fourth, accounting for less than 10% of the mortgage market. (…).

The main entities have a combined balance of foreclosed homes amounting to more than €17,000 million. The bank that holds the largest portfolio of foreclosed homes is BBVA, with almost €4,500 million. CaixaBank is ranked in second place, with more than €2,762 million, whilst Bankia, in third place, has €2,700 million. (…).

Original story: El Economista (by Fernando Tadeo)

Translation: Carmel Drake

Bank Of Spain: Loans To Families Rose In H1 2016

2 August 2016 – Expansión

First increase since 2010 / The appeal of consumer loans and lower mortgage repayments is leading to a change in the decreasing loan balance trend. However, business financing decreased due to the political uncertainty.

(…) The latest figures from the Bank of Spain and the financial institutions show that the trend in terms of credit is changing, which could make 2016 the year of recovery in the credit sector.

In this sense, loans to families across the sector grew by 1.04% in June and recorded a half year increase, of 0.02%, for the first time since the start of the crisis. In addition, eight of the eleven Spanish entities that have now presented their results, reported increases in gross loans to clients during the first six months of the year.

These figures show that for the first time, the volume of new loans granted by the entities exceed the volume of repayments, thanks to the liquidity measures led by the European Central Bank (ECB) and the need for entities to grow volumes to offset their decreasing margins.

The last time that Spanish financial entities increased their total loan balance to families was during the first half of 2010, when the international financial crisis had not yet reached the Spanish sector.

In this way, families then held financial debt with Spanish banks amounting to €724,100 million, i.e. €117 million higher than the €723,993 million balance at the end of 2015.

Boost from consumption

This rise comes mainly due a boost from consumer credit in recent months, thanks to the economic recovery and the gradual reduction in unemployment. In this way, the outstanding consumer loan balance increased from €162,000 million at the end of 2015 to €171,00 million at the end of June 2016.

This €9,000 million growth offset the incessant deleveraging of households away from mortgages, which have decreased from more than €549,000 million in December last year to almost €541,000 million at the end of the first half of this year. In other words, a difference of €8,000 million, below the growth in consumption.

These figures reflect a deceleration in the decrease of the outstanding mortgage balance, which has been falling at a rate of more than €25,000 million in recent years. In 2016, repayments have slowed and the granting of new mortgages has increased, as reflected by the new credit data.

The change in the trend of loans to households has not affected financing for companies. That decreased by 1.6% during the first 6 months of the year – from €918,199 million to €903,378 million – due to the opening of other alternatives such as MARG and the issue of bonds, and the deceleration in demand caused by the political uncertainty. That was one of the main concerns expressed by Spanish bankers during the presentations of their half year results. (…).

By entity

(…)The increase in Bankinter’s loan balance (13.7%) was noteworthy, although that figure was impacted by the acquisition of Barclays Portugal, given that the entity does not segregate those numbers. It was followed by Abanca,which reported that its financing balance grew by 4.1%; CaixaBank, with a rise of 1%; and Santander España, with an increase of 0.8%. (…).

Original story: Expansión (by J. Zuloaga)

Translation: Carmel Drake

Abanca Sells €1,400M NPL Portfolio To EOS Spain

14 June 2016 – Expansión

Two years after taking ownership of Abanca, the Venezuelan company Banesco has started to sell off the bank’s toxic assets. Yesterday, the financial entity headquartered in Galicia reported its first sale of non-performing loans, amounting to €1,385 million, which represents approximately 20% of its total NPL portfolio.

All of the loans were overdue and unsecured, which makes it one of the largest operations of its kind in recent years and also, concentrated in a single buyer.

EOS Spain, a company that specialises in collections management was the winner of the competitive process. It is headquartered in A Coruña and is a subsidiary of the international group EOS. The transaction generated profits of €57.4 million for the bank, according to a statement filed with the CNMV.

The auction generated significant interest, with participation from around twenty investment funds and entities specialising in the recovery of overdue debt. For this competitive process, Abanca was advised by KPMG, the same firm that audits its accounts.

The operation (…) will open a series of future transactions as part of Abanca’s strategy to divest of its non-performing assets. In fact, it says that it is already evaluating similar operations for its non-strategic assets, with the aim of focusing the business on providing credit to families and companies and to boosting the economy.

One of the upcoming operations will involve a portfolio of non-performing loans, secured by mortgaged assets, although that will be smaller than the portfolio just sold. By contrast, the bank will hold onto the other overdue unsecured loans so that they can be managed by Abanca itself.

For EOS, the purchase “represents the strengthening of its relationship with Abanca”, according to a statement from the bank, as well as an intensification of competition and an improvement in its position in the domestic market.

Improved capitalisation

The main effect of the sale has been on the solvency of the entity, given that it had fully provisioned all of the non-performing loans that it has now sold. Abanca calculates that with this transaction, it has improved its capital coefficient by five basis points since the first quarter of the year, when it stood at 14.8%, one of the highest in the sector. Meanwhile, the doubtful asset coverage ratio amounted to 60.8% during that same period. According to the annual accounts, Abanca had decreased its doubtful debt balances by 30% last year to €2,695 million as at December 2015; furthermore, it reduced the weight of foreclosed assets on its balance sheet to just 1%.

Of the total impaired asset balance, more than half (€1,900 million) are secured and only €114 million were overdue by three months or less (as at December 2015), according to details disclosed in the consolidated annual accounts for 2015.

Beyond its consolidated balance sheet, the entity accounted for €5,376 million of financial assets that it had written off. The bank explained that it was not including them on its balance sheet because it regarded (the likelihood of) “their recovery to be remote”, although it clarified that it has not stopped trying to collect the amounts due.

Original story: Expansión (by A. Chas and J. Zuloaga)

Translation: Carmel Drake

Spaniards Keep The Same Home For 12 Years On Average

26 April 2016 – Cinco Días

Yesterday, Spain’s Association of Property Registrars published the Yearbook of Property Registry Statistics, which analyses aspects such as the use that Spaniards make of their homes, amongst other factors. This use is deduced from the average period of ownership of each home, a very valuable piece of information that is only recorded by the registrars. In 2015, that average period amounted to 12 years and seven months, whilst in 2008, the figure amounted to just seven years and 10 months.

Thus, although this conclusion is not foolproof, the Treasury has already stipulated that during the recent boom, if a home was owned for less than five years then it may indicate that the property was acquired as an investment, whereas properties owned beyond that period, are likely to be used as residences.

The numbers published yesterday show once again that, since the bubble burst and the serious problems being faced by many citizens and companies when it comes to selling their homes emerged, operations involving properties that have been owned for more than five years have gained ground.

In fact, those operations went from representing barely 43.7% of all transactions in 2007 (in other words, less than half of the homes that were bought and sold during the last year of the boom were residences) to 80.7% last year, which the experts describe as a much more balanced figure. By contrast, those operations involving properties owned for less than five years went from accounting for 56.3% of all sales and purchases in 2007 to 19.3% last year.

Another significant finding relates to who participated in the majority of sales and purchases. In 2015, 87.3% of transactions were carried out by families, which represented the second consecutive increase since 2013. Companies, by contrast, continued to lose weight, accounting for just 12.7% of operations, compared with 15.3% in 2014 and 21.9% in 2013. Nevertheless, the figures are still a long way from the minimum of 5.1% recorded in 2007.

House purchases by foreigners accounted for 13.2% of the total and that figure has now been growing for seven years. In the Balearic Islands, that percentage amounted to 35.6%. Moreover, 5.2% of all operations completed by foreigners involved properties costing more than €500,000.

Original story: Cinco Días (by Raquel Díaz Guijarro)

Translation: Carmel Drake