House Sales to Foreigners Fall Sharply in the Balearic and Canary Islands

13 May 2019 – El Confidencial

According to data from the General Council of Notaries, sales to foreigners fell by 15.3% in the Canary Islands and by 13.5% in the Balearic Islands during the second half of 2018, compared to the same period a year earlier. This is significant because overseas buyers currently account for almost 38.5% of sales in the Balearic Islands and 34% in the Canary Islands.

Several property developers have been feeling the pinch. Competition has increased a lot, above all in some local markets, and prices have risen in certain areas, due to a shortage of land and increased competition, which is deterring demand.

House purchases by foreigners have also been showing some signs of stagnation at the national level, with lower growth rates recorded in 2018. Foreigners closed 50,249 operations last year, which represented an increase of just 1.4% YoY.

The Brits are back

Despite the decreases, the most active buyers during H2 2018 were the Brits (15.3%), followed by other foreigners from outside the EU (12.1%) and then the French (8.0%), Germans (7.5%) and Romanians (7.1%). In the case of the British, it seems that the initial shock of the results of the Brexit referendum (which caused purchases by Brits to fall by 23.6% in H2 2016 and by 16.1% in H1 2017) has worn off.

Original story: El Confidencial (by E. Sanz)

Translation/Summary: Carmel Drake

Registrars: 400,000 Homes Sold During 9 Months to September 2018

16 November 2018 – Expansión

The housing market is showing a dynamism during 2018 not seen since the years before the crisis. The boost in demand in the last few months has resulted in the sale of almost 400,000 homes during the 9 months to September, the highest figure since 2008, which is driving prices up.

House sales amounted to 396,481 units between January and September, up by 12.5% compared to the same period in 2017, and the highest figure recorded since 2008, when 448,146 units were sold during the first 9 months to September, according to Real Estate Registry Statistics for the third quarter, published yesterday by the College of Registrars.

Data for the first nine months of the year also came close to the figure recorded for 2017 as a whole, bearing in mind that last year 464,223 transactions were closed in total. This year, it is likely that a record figure will be registered, which could reach half a million operations. During the third quarter, 133,295 operations were closed. “These results confirm the notable strength of the housing market (for sales)”, explained sources at the College of Registrars.

The strong dynamism responds in large part to the demand for investment. Buying a home for rent has become an alternative refuge for domestic and overseas investors alike, who find returns in the real estate market that other assets, such as deposits and public debt cannot offer. Moreover, during the last 12 months, the initial interest rate for taking out a mortgage has been at a historical low (2.27%).

The strong activity in the sector is also raising house prices, which increased by 6.7% in YoY terms in the last quarter. The recovery of the sector has allowed prices to rise to 26.5% above their minimum levels. Over the next few months, the registrars expect prices to continue to evolve in line with their current performance, albeit at single-digit rates. The rises will be greater in the main capitals.

These increases are being favoured by the heating up of the sector in certain areas. The largest increases during the third quarter were recorded in Teruel (37%), Huelva (34.8%) and Castellón (33.8%), but Madrid, Barcelona and Málaga led the activity in the market in absolute terms, with 20,048 homes sold in the case of Madrid, 14,217 in Barcelona and 9,828 in Málaga (…).

Foreigners are buying more homes than ever in Spain. According to data from the General Council of Notaries, during the first half of the year, they closed 53,359 operations, the highest absolute figure in the historical series, which began at the start of 2007.

By segment, second-hand homes continue to account for the majority of the market, with 82.4% of sales, compared with 17.57% for new homes (…).

Sources at the College of Registrars detect a possible “scenario that is running out of steam following the intense upward path that has been seen over the last few quarters”, and they warn that we “may have reached a maximum point in the current cycle in terms of the number of house sales”.

That is partly due to the increase in prices, which “is not sustainable or desirable in the current economic situation”. The intense double-digit growth in prices seen in recent months “cannot be borne by a market comprising potential buyers whose incomes cannot absorb such an intense increase in prices”.

But they clarify that it does not mean that we are going to see a correction (reduction) in prices in YoY terms, rather that we can expect more moderate increases (…).

Original story: Expansión (by I. Benedito)

Translation: Carmel Drake

Notaries: House Sales Rose by 7.6% in Q1 2018

16 July 2018 – Eje Prime

There has been a slight cooling off in terms of residential transactions. House sales rose by just 7.6% during the first quarter of 2018, representing a “small deceleration” in YoY growth with respect to previous quarters, which have been exceeding 10%, according to the General Council of Notaries.

House transactions rose in the majority of the autonomous regions, led by La Rioja, with an increase of 22.6%. It was followed by Murcia (+20.9%) and the Community of Valencia (+18.5%). At the opposite end of the spectrum were the Balearic Islands (-8.1%), the Canary Islands (-2.4%) and Extremadura (-1.2%).

As with the volume of operations, prices also showed signs of a decelerating trend, although they did rise by 1.4% on average. The national average price amounted to €1,377/m2, whilst in País Vasco, the Balearic Islands, Madrid, Cataluña and the Canary Islands, prices exceeded the average, at €2,208/m2, €2,157/m2, €2,146/m2, €1,646/m2 and €1,490/m2, respectively.

In addition, the sale of flats grew by 6.9% during the first quarter, somewhat lower than the increases of more than 10% seen in the previous eight quarters.

On the other hand, according to the General Council of Notaries, the “significant” increase in the number of mortgage loans to acquire homes, seen last year, continued at the national level (+10.9%) during the first quarter.

Original story: Eje Prime

Translation: Carmel Drake

Taylor Wimpey Enters Sotogrande & Strengthens its Presence in Ibiza

28 May 2018 – Eje Prime

Taylor Wimpey España is entering one of the most luxurious urbanisations in Spain. The Spanish subsidiary of the British real estate group is backing Sotogrande, synonymous with luxury housing, in its business plan for 2018, which also includes the launch of around twenty developments in the Balearic Islands, Costa del Sol and Costa Blanca, the three markets where it already has a presence and “in which we will continue working”, says Reyes Coll, Marketing Director at Taylor Wimpey in Spain, speaking to Eje Prime.

So far this year, the real estate company has launched eight new projects. Four of them are located on the Costa del Sol, three in Mallorca and the eighth is in Alicante. The aim of the company is to “launch between five and ten more promotions before the end of the year”, says Coll.

Taylor Wimpey’s main business in Spain is second homes for foreigners, which account for more than 90% of the company’s housing reservations.

In the Balearic Islands, where land is scarce and prices are growing rapidly, the company is finalising the requirements necessary to bring three new projects onto the market: Cala Lliteras, Cala Vinyes and Cala Gració. The latter is located in Ibiza, an island on which the real estate only has 22 homes to date, in Can Misses. The other developments in the Balearic region are located in Mallorca (…).

Almost twenty developments on the market

Without taking into account the aforementioned projects and those in the pipeline, the real estate company already has 19 developments up for sale in the country. Mallorca and the Costa del Sol are the two regions where most of its developments are located, with seven residential projects up for sale, whilst the company has five urbanisations on the market on the Costa Blanca.

Taylor Wimpey España’s business depends on foreigners interested in buying a second home in the country. This profile of buyer is growing again in line with the recovery of the economy. Indeed, the company recorded a 10% increase in its portfolio of international clients. “German, Scandinavian, British, Russian and Belgian buyers all stood out”, explains Coll. The General Council of Notaries explained recently in a report that those nationalities account for the fact that 20% of the homes purchased in Spain are acquired by foreigners. In 2017 alone, the company completed operations involving new homes with buyers from 32 different countries.

In the case of buyers from the United Kingdom, players in the Spanish residential market were fearful of the consequences that Brexit might have on sales. Nevertheless, sources at Taylor Wimpey explain that reservations from Brits have increased over the last nine months.

40% growth in post-crisis reserves

The end of the real estate crisis has also arrived for Taylor Wimpey España, whose reservations grew by 40% in 2015 and have continued to increase ever since (…).

According to its roadmap, the company is not planning any changes to the line of business that it has operated for sixty years. The property developer will continue to specialise in the construction of apartments and terraced homes in the most touristy areas of the country and will finance them solely using own funds.

Original story: Eje Prime (by J. Izquierdo)

Translation: Carmel Drake

Notaries: House Sales Rose by 10.1% in November but House Prices Fell by 0.9%

9 January 2018 – Eje Prime

The positive steps that the housing sector in Spain took in 2017 are continuing. That is according to data from the General Council of Notaries relating to November 2017, when 46,722 transactions were signed, up by 10.1% compared to the same period in 2016.

Nevertheless, the residential sector was hit by a slight decrease in value, with a decrease of 0.9% in house prices, taking the average price per square metre of properties acquired in Spain during November to €1,288/m2. According to the College of Notaries, this decrease in house prices was driven by a reduction in the price of family homes, which suffered a decrease of 1.3%, and flats, whose prices fell by 0.1%.

In terms of the different types of homes, private flats saw a YoY volume increase of 8.9%, with a notable expansion in the number of new build homes (9.5% more) and also in the number of second-hand homes (8.9% more). Despite that, the property segment that grew by the most was family homes, with an increase of 13.7% with respect to November 2016.

Meanwhile, the number of mortgages also grew during the penultimate month of 2017. Loans to buy homes increased by 0.6%, with 28,834 mortgage applications and an average mortgage loan of €169,163.

Original story: Eje Prime

Translation: Carmel Drake

Argia’s Bankruptcy Leads to Oviedo’s Largest Ever Land Auction

10 December 2017 – El Comercio

The bankruptcy of the property developer owned by the businessman Blas Herrero, Argia Inversiones Inmobiliarias, and the lack of interest in most of its assets from its banker, Liberbank, have made way for the city’s largest-ever auction of private land. In total, 159 lots worth more than €30 million will go under the hammer, ranging from buildable estates in Cerdeño, to buildable land in Prados de la Fuente, to around fifty finished homes also in Prados de la Fuente.

In reality, the investments are very recent. Herrero did not seek to obtain any returns from the land and housing sectors in Spain until 2005 when he took control of Inverural Capital and turned it into Argia Inversiones Inmobiliarias. After a few years of activity, the company stopped filing its annual accounts – in 2009 – and went off the radar.

In Oviedo, the firm had promoted one of the largest plots of land in Prados de la Fuente, under the commercial name Galana Residencial. The work on that group of buildings…did not go well…The first buyers reported problems with the finishes, as well as humidity in the garages and the poor quality of the padel court.

Eight years after the homes were handed over, 51 apartments in different parts of the development are now going on the market, with appraisal values ranging from €155,484 for a first floor 3-bedroom property to €250,000 for homes that are bigger and higher up (…).

House prices in the city of Oviedo in Q3 2017 amounted to €1,264/m2, according to the appraisal company Tinsa. In YoY terms, they rose by 1.5%, but the number of transactions was still very low and, in 2016, prices fell by 0.8% in YoY terms. Since the middle of 2008, each homeowner in Oviedo has lost 37% of his/her property value, on average (…).

Volatility and low returns are two of the factors that have ended up causing the Asturian businessman Blas Herrero to surrender his real estate ambitions just ten years after launching them and after more than five years of unremarkable activity. In 2015, Argia Inversiones Inmobiliarias filed for voluntary creditors’ bankruptcy. The liquidation plan…was approved in January.

A peaceful end is anticipated with the voluntary auction that is due to be held on 20 December. The 159 lots, which will be bid for independently, include some mortgage charges in favour of Liberbank, who has most at stake in terms of the success of these disposals (…).

Prices and lots

The data is not encouraging. In the last year – between July 2016 and June this year – 633 homes were sold across the whole of Asturias (…). The figures indicate that the crisis is still on-going. A decade ago, the General Council of Notaries recorded three times as many real estate transactions per year. Moreover, some of the lots are far from the reach of most (…). Specifically, three plots from the special plan are together worth €10.5 million (…).

Original story: El Comercio (by Gonzalo Díaz-Rubín)

Translation: Carmel Drake

Notaries: Foreigners Bought 13.4% More Homes During H1 2017

27 November 2017 – Eje Prime

International players are setting their sights on Spain for investment. The purchase of private homes by foreigners amounted to 50,087 operations during the first half of 2017, which represents an increase of 13.4% compared to the same period last year, according to data from the General Council of Notaries.

Operations completed by overseas purchasers accounted for 19.4% of the total number of sale-and-purchase operations signed during the period, compared with 20.3% during the first half of 2016, although that figure has been increasing since 2007, in line with the start of the economic crisis.

If we differentiate between resident and non-resident foreigners, 46.6% of the purchases were made by non-resident foreigners, up by 5.1% YoY, which means that operations by resident foreigners accounted for 53.4%, the highest proportion since 2011. They grew by 21.8% YoY.

All of the autonomous regions reported progress in terms of the number of homes purchased by foreigners and only five of them recorded increases below the national average, which stood at 13.4%, specifically: the Balearic Islands, with just 5.3%; Andalucía, with 5.4%; Murcia, with 5.7%; the Canary Islands, with 10.1%; and the Community of Valencia, with 12%.

Finally, the average price per square metre of the operations undertaken by overseas buyers amounted to €1,667/m2, which represents an increase of 2.9% in YoY terms. Specifically, the price paid by non-resident foreigners rose by 4.5% to €1,941/m2, whilst the price of homes purchased by residential foreigners increased by 2.8% to €1,405/m2.

Original story: Eje Prime

Translation: Carmel Drake

Notaries: House Sales Rose By 8.6% In Sept To 40,094

20 November 2017 – Eje Prime

House sales are continuing to soar. The volume of residential transactions rose by 8.6% in September with respect to the same month in 2016 (and by 12.2% in the series corrected for seasonality) to 40,094 operations, according to data from the General Council of Notaries.

By type of home, the sale of apartments registered a YoY increase of 7.7% (up by 11.3% in the series corrected for seasonality) and the volume of private home sales rose by 8.%. This increase in the number of transactions involving private homes was due, exclusively, to the expansion of second-hand home sales (10%), given that the sale of new build homes decreased by 1.9% YoY. Meanwhile, the sale of family homes rose by 12% YoY.

In terms of average prices, the cost per square metre of the homes purchased in September 2017 amounted to €1,331/m2, whereby reflecting a YoY price increase of 2.4%. According to the notaries, this increase in the price per square metre of homes was due to both an increase in the price of family homes (1.4%) and an increase in the price of apartments (3.8%). Meanwhile, the price per square metre of private homes rose by 4%.

Original story: Eje Prime

Translation: Carmel Drake

Notaries: House Sales & Prices Rose In Q2 By 14.2% & 5%, Respectively

31 October 2017 – El Mundo

House sales rose by 14.2% on average during the second quarter of 2017 with respect to the same period in 2016, to exceed 142,000 transactions, whereby moderating the YoY increase experienced in the previous quarter (20.3%) by six points, according to data from the General Council of Notaries.

By type of dwelling, flat sales recorded a YoY increase of 15.3% during the second quarter of 2017, and whereby accumulating 14 consecutive quarters on the rise. In terms of prices, the average cost of homes purchased during the second quarter was €1,387/m2, up by 5% YoY. Meanwhile, the price of flats (in general) rose by 5.6% YoY to €1,529/m2.

According to the Notaries, the sale and purchase of homes rose in every autonomous region during the second quarter of 2017, with the exception of the País Vasco, where sales fell by 0.4% YoY. The highest increases were recorded in the autonomous regions of La Rioja (25.9%), Asturias (21.6%) and Castilla-La Mancha (19.6%).

In terms of house prices, they decreased in Murcia (4.3%), Cantabria (3.7%), Aragón(0.5%) and Castilla y León (0.3%) but rose in the remaining 13 regions, in particular in Navarra (17.7%), Castilla-La Mancha (11.1%), Cataluña (9%) and the Canary Islands (8.9%).

On the other hand, the number of new mortgages granted in the second quarter of 2017 fell by 2.4% with respect to the same period in 2016, after having increased by 7.8% YoY during the first quarter.

Original story: El Mundo 

Translation: Carmel Drake

Notaries: 48,695 Homes Were Sold In March, Up By 19.5% YoY

23 May 2017 – Aquimicasa.net

According to the notaries, March was a great month for the real estate sector. Despite the scare in February, sales of flats and houses rose by 19.5% in March, to reach 48,695 operations. But, since it can’t be all good news, it is worth noting the statistics published by the General Council of Notaries last Monday, which reveal that the average price of operations decreased by 1.3%.

Our analysis of the data published by the notaries shows that by type of home, flat sales recorded a YoY rise of 20.5% and sales of private (unsubsidised) properties rose by 21.9%. But, as has been happening for years, this increase in the number of private flat transactions was due, exclusively, to an increase in sales of second-hand flats, which rose by 26%, given that sales of new build homes continued their downwards trend, decreasing by 11.5%. Meanwhile, sales of houses and chalets saw a YoY increase of 15.6%.

If we look at the prices achieved, we see that the average price per square metre of the homes purchased in March stood at €1,277, which represents a decrease of 1.3% with respect to the same month last year. According to the notaries’ statistics, the decrease in the price per square metre of homes is due to a reduction in the price per square metre of houses and chalets (-6.2%), given that the price of flats did not vary in March.

Meanwhile, there was a slight increase in the average price per square metre of private (unsubsidised) flats, which rose by 0.3%, split between an increase of 0.8% in the price of second-hand flats and a decrease of -0.6% in the price of new build homes.

The sale of other types of properties saw 11,753 operations closed, which represents an increase of 15.2% compared to the same month last year. 39.7% of those transactions corresponded to plots of land. And despite the rumours of an increase in the price of land, that trend must be happening in specific areas only, given that the average price per square metre amounted to €155, representing a decrease of 10.4% YoY.

Finally, if we look at mortgages, during the month of March, they experienced YoY growth of 5.1%, to reach 32,070 operations, for an average amount of €156,229, in other words, a decrease of 3.4%. Meanwhile, mortgage loans granted for the acquisition of a property increased by 16.8% YoY, to a total of 23,542 contracts. Other mortgages included those used to build a home or to finance business activities.

Original story: Aquimicasa.net

Translation: Carmel Drake