The Gap In House Prices By City: Falls Of 10% And Rises Of 3% In 2014

27 January 2015 – Expansión

House prices are evolving at different rates, depending on the region or city that you look at. Whilst in 2014, seven provinces and eight capitals recorded decreases of more than 10%, others experienced increases of close to 3%, according to Tinsa’s IMIE Local Market Index.

Overall, prices declined by 4.5% during the last quarter of 2014, compared with a year-on-year decrease of 4.3% in the third quarter and the fall of 8.3% from a year earlier.

“Although average house prices in Spain began to stabilise a little over a year ago and there has been progressive moderation of year-on-year decreases, the statistics show that some areas have started this stabilisation process more slowly and are still experiencing significant decreases”, says the document.

The gap that exists between cities is very noticeable. For example, whilst in Malaga, prices increased by 4.7% during the fourth quarter with respect to the previous year, house prices in the city of Ávila recorded a year-on-year decrease of 11.7%. “Another seven capitals recorded decreases of more than 10% in 2014. Namely, Huelva and Bilbao (both with a decrease of 11.1%), Almería and Badajoz (both with declines of 10.8%), Córdoba (-10.6%), Oviedo* (-10.4%) and Vitoria (-10%)”, adds the document published by the valuation company Tinsa.

By city, the most notable increases were in: Melilla (+2.3%), Palencia (+1.3%), Palma de Mallorca (+0.5%) and Barcelona (+0.2%). Meanwhile, prices stabilised in Burgos (0.0%). Three capitals recorded decreases of less than 2%: León (-0.5%), Murcia (-1%) and Vigo (-1.7%).

Looking back, Ávila is the capital that has experienced the greatest cumulative decrease in prices since 2007, at 56.1%, followed by Zaragoza and Guadalajara capital, where the decline during the crisis years reached 55.1% and 55%, respectively.

By province, the behaviour of prices in Navarra (-14.1%), Lérida (-14%) and Cuenca (-12.7%) contrasts with the increases in Palencia (+3%), Teruel (+2.8%) and Melilla (+2.3%).

In terms of the data by autonomous region, only two regions have experienced notable price increases: Melilla and the Balearic Islands (by 2.3% and 1.5%, respectively). On the other hand, decreases were recorded in Navarra (-14.1%), Asturias (-9.4%), the Canary Islands, Castilla y Leon and Valencia (all -6.8%) and Murcia (-6.5%).

*Provisional data

Original story: Expansión (by M. G. Mayo)

Translation: Carmel Drake

Housing: Rental Prices Increase By 2.6% In 2014

21 January 2015 – El País

Barcelona is the most expensive regional capital in Spain and Lugo is the most economical.

House rental prices in Spain closed the year (2014) with a slight increase of 2.6%, to reach €7 per square metre per month. During the last quarter of the year, prices continued to rise, up by 0.2%.

“The data shows a stable outlook for the rental market, which although is now recovering, is not showing any signs of a sudden increase in prices. In any case, as with the market for house sales, we have to recognise that the rental market has two speeds. Thus, the increases recorded in markets such as Madrid, Barcelona, tourist areas and specific areas of the País Vasco have sparked interest from investors towards these regions, however this has been at the detriment of other less profitable areas”, says Fernando Encinar of

By autonomous region, the greatest increase was recorded in Cataluña, where landlords are now charging 9.8% more to let their properties than a year ago. It is followed by the regions of Extremadura (3.9%) and the Balearic Islands (2.4%).

By contrast, Murcia and Galicia have experienced price reductions of around 4% and 3%, respectively.

Madrid continues to be the most expensive autonomous region, at €10.20 per square metre. It is followed closely by the País Vasco (€10.00/m2) and Cataluña (€9.20/m2).

Barcelona consolidated its position as the most expensive regional capital in Spain, with an average price increase of 11% to take it to €12.50 per square metre; it is followed by San Sebastián (€11.80/m2) and Madrid (€11.40/m2). At the opposite end of the table, we find Ourense and Lugo, as the cheapest regional capitals, with an average price of around €4.10/m2 in both cities.

Notably, Jaén was the regional capital that saw the highest increase in rental prices in 2014, which grew by 10.4%.

Original story: El País (by Paula Cossío)

Translation: Carmel Drake

Spain’s Top Cities Show Signs Of Housing Recovery

21 January 2015 – WSJ

Spain’s residential real-estate recovery is a tale of two cities: Madrid and Barcelona.

Barcelona is the only city in Spain to post an annual increase in home prices during 2014. Prices in the city rose 2.8%, with some neighborhoods gaining as much as 8%.

Madrid, too, has fared better than most. While it hasn’t enjoyed price gains, Madrid’s decline of 4.9% last year was better than the 5.7% drop for Spain overall, according to, a Spanish property website.

The price performance in Madrid and Barcelona helps explain why Spain’s construction sector is expected to make a comeback in 2015 after seven comatose years, as demand grows amid a modest economic recovery. Most of the building will take place in Spain’s two biggest cities.

“You have to look at Spain as if it were two countries,” says Fernando Rodríguez de Acuña of real-estate consulting firm R.R. de Acuña & Asociados in Madrid. “There’s the Spain that’s recovering. That’s the Spain that has the big cities and wealthy coastal areas. Then there’s the Spain where we went crazy during the housing boom, and that’s not going to recover for at least 10 years.”

New housing permits in greater Madrid were up 26.4% in the first 10 months of last year compared with the same period in 2013, according to the latest available data from Spain’s Ministry of Public Works. Most of the residential construction, investors say, is apartment buildings. Loans to build residential housing in Spain overall were up 25.6% in the third quarter of 2014 from a year earlier, according to Spain’s General Council of Notaries.

No one expects a surge in building comparable to the boom days. Nearly the same number of building permits in greater Madrid were issued in June 2006, at the height of the building frenzy, as in the first 10 months of 2014.

The construction comes as Spain tries to digest an estimated one million unsold empty houses, which can seem “counterintuitive,” says Fernando Encinar, head of research at, a Spanish property website. “In 2015, there will be a high level of housing stock at the national level, but a deficit of housing in certain markets that will allow for the construction of new homes.”

Even within Madrid and Barcelona, there are major differences. Home prices in an exclusive neighborhood of Madrid, Chamartín, fell 2.2% in 2014, while another neighborhood south of the center, Villaverde, saw declines of 14.6%, according to data from

Spaniards who didn’t lose their jobs during the country’s downturn and have been waiting for house prices to slow their decline are among the most likely buyers, analysts and investors say. Banks also have been more willing recently to issue home mortgages to buy the newly built houses.


Fernando Moliner Robredo, Chief Executive of Actívitas Inversión Inmobiliaria SL, the developer of a 105-unit apartment building in the Villaverde neighborhood of Madrid, says a postcrisis building lull created a need for housing. “In Madrid, new housing stock won’t cover demand for more than six or nine months,” he says.

Luis Martín Guirado and César Barrasa, executives at Sareb, Spain’s “bad bank,” say they also are seeing an uptick in demand for land beyond Madrid and Barcelona, including along the Mediterranean Coast and the Balearic Islands.

The expectations for construction growth in Spain break from the norm in other European cities hard hit by the financial crisis. Residential property development in Europe has generally remained sluggish.

“The standout would be Germany, which has been able to maintain robust levels of capital investment,” said Simon Rawlinson, head of strategic research at construction-consultancy Arcadis . “Most others have not.”

Before the crisis, cheap mortgage lending helped drive housing construction in markets like Spain and Ireland. Spain’s construction sector started to collapse in 2008, as the market was clogged by the building boom. The bust saddled banks with billions of euros in bad loans, forcing lawmakers to request a €41 billion bailout from the European Union to shore up confidence in the stability of the country itself.

The signs of life in Spain’s building sector come as the number of unemployed has declined and as the country’s economy—the fourth-largest in the European Union—is expected to grow more than 2% in 2015, among the strongest performers in the region.

But the country’s recovery is a modest one. Unemployment is still a staggering 23.7%, the highest in the EU after Greece.

An increase in construction now “doesn’t mean that everything is going well in the real-estate sector,” says Mr. Rodríguez de Acuña. “Construction is happening in very specific areas and at very competitive prices, which is why they are able to sell it.”

Original story: WSJ (by Jeannette Neumann in Madrid and Art Patnaude in London)

Edited by: Carmel Drake

House Sales Increase By 14% YoY But Prices Fall By 1.5%

20 January 2015 – El Economista

31,576 homes were sold in November 2014, an inter-annual increase of 14%; this figure rises to 18.5% per the seasonally adjusted series, according to the Notarial Statistics published this morning by the General Council of Notaries.

The figures reflect a clear stabilisation in monthly sales. Between January and November 2014, the average number of transactions amounted to 29,016 per month, i.e. 17.5% higher than during the same period in the previous year (24,697).

By type of property, flat sales recorded year-on-year growth of 14.4% (19.1% per the seasonally adjusted series), similar to the increase in free market flats (13.9%). This increase in the number of flat sales was due to a strong rise in the sale of existing flats (21.5%), whilst the purchase of new flats declined by 21.0% year-on-year. Meanwhile, sales of family homes increased by 12.3% year-on-year.

In terms of average prices, the cost per m2 of homes purchased in November was €1,194, reflecting a YoY decrease of 1.5%. This reduction in the m2 cost of homes was driven by a decrease in the price per m2 of flats (-3.1% YoY). The price per m2 of family homes increased by 4.1% YoY.

Within the realm of flats, the price per m2 of existing flats amounted to €1,287 (down 1.3% YoY) and the price per m2 of new flats was €1,506 (down 6.4% YoY).

Finally, 7,568 other property-related transactions were closed in November (up 3.8% YoY); 38.0% of which related to land and plots. The average price per m2 of these transactions amounted to €258 (down 12.0% YoY).

Thus, the sector’s monthly figures continue to show that the Spanish property market is stabilising.


The evolution of the mortgage market for the purchase of homes also reflects the stabilisation observed in the real estate sector, having recorded, for the sixth consecutive month, an increase in overall credit, in both absolute and seasonally adjusted terms.

The number of new mortgages taken out during the month of November amounted to 23,264, which represents a strong year-on-year increase of 10.3% (14.7% per the seasonally adjusted series). The average amount borrowed in this case was €126,525, reflecting a minimal increase of 0.1% year-on-year.

Meanwhile, the number of mortgage loans taken out to acquire a property rose by 35.1% year-on-year in November (to 13,857 loans), due mainly to the increase in lending to purchase a home (la concesión de créditos para la adquisición de una vivienda) (37.3% YoY), whilst an increase of 12.5% was recorded for other properties. The average amount borrowed for acquisition amounted to €113,093 (down 0.6% YoY). For homes, average equity was €109,022 (down 0.4% YoY) and the average loan for other properties amounted to €159,533 (up 0.7% YoY).

In turn, the number of mortgages taken out to finance construction rose by 46.8% in the year to November, to 345 new loans. The average amount borrowed amounted to €255,841, representing a year-on-year decrease of 25.7%, driven by a significant decline in the average capital of loans used to construct non-residential buildings (down 50.7%).

Similarly, the number of mortgages taken out to finance business activities increased by 0.7% year-on-year, whilst the amount borrowed decreased by 21.0%.

Finally, the percentage of homes purchased using mortgage financing amounted to 40.6%. In addition, for this type of purchase with financing, the amount borrowed represented an average of 74.9%.


Original story: El Economista

Translation: Carmel Drake

Fitch: Recovery In Housing Market, But No Rapid Rise In Prices Or Mortgages

15 January 2015 – Expansión

The ratings agency Fitch believes that the downward trend in house prices in Spain is coming to an end after seven years, but that unemployment and the real estate “stock” mean that there will not be a rapid recovery in prices.

Fitch explains that the stabilisation of house prices and of the mortgage market is a reflection of the macroeconomic recovery in Spain and the growing willingness of banks to lend to the most creditworthy customers.

However, despite the efforts made by the European Central Bank (ECB) and the “cheap money” that has been made available to Spanish banks, Fitch does not expect there to be a rapid recovery in the number of mortgages loaned, Efe reported.

According to the ratings agency, the depreciation in the value of foreclosed and sold homes has amounted to 70% in certain cases with respect to their initial valuations.

Similarly, the price range in which banks are selling foreclosed homes has also declined considerably, says Fitch.

Fitch’s analysis suggests that the discounts on forced sales are higher in the coastal regions, such as Andalucía and Cataluña, and that further price cuts are required to find buyers for foreclosed properties and those linked to mortgages signed before the financial crisis.

Nevertheless, although mortgage lending is returning, the high level of unemployment and the housing surplus mean that we should not expect to see a rapid rise in prices.

Furthermore, Fitch points out that 768,000 homes built between 2002 and 2011 remain empty, and that the real estate sector has now bottomed out in terms of prices, as indicated by data published by the National Institute of Statistics (INE), which indicate price increases of 0.8% in the second quarter of the year, the first increase since the outbreak of the crisis.

Original story: Expansión

Translation: Carmel Drake

Who Bought Homes In 2014?

15 January 2015 – Expansión

Latest official data show that house sales increased during the last few months of 2014 and that the real estate sector is showing real signs of recovery. Who is behind this recovery? What was the profile of the typical home buyer in 2014?

The real estate portal,, has conducted a survey, which reveals the main characteristics of the people that took the plunge and bought a home in 2014. Details below:

  1. Most finance their purchase with a mortgage

62% of the Spaniards who bought property in 2014 financed their purchase through a mortgage. Notably, 32% paid in cash and another 6% said that they were able to afford to buy their property thanks to other forms of financing (inheritance and gifts).

  1. Aged between 35 and 44 years old

By age group, the survey shows that the most active buyers fell into the 35 to 44 year-old age group (38%), followed by those aged between 25 and 34 years old (26%) and those aged between 45 and 54 years old (24%).

Lagging somewhat behind, 9% of purchasers were aged between 55 and 65 years old, 2% were over 65 and 1% were under 18.

  1. Bought with their partner

In terms of marital status, the survey reveals that 56% of the Spaniards who purchased a house in 2014 were married, versus 35% who were single and making the purchase by themselves, and 7% who were divorced or separated (2% did not respond to this question).

  1. Have jobs, a determining factor

In terms of employment status, 88% of Spaniards who bought a home last year are currently employed. Clearly, having a source of income that is more or less stable, is a key condition for taking the plunge into the property market.

In fact, only 6% of the people that made a purchase last year were unemployed and on benefit, and a further 6% were unemployed and not receiving any benefits.

The survey also highlights that of the 88% of Spaniards that bought a house and are employed, “15% work in the public sector, 9% work in education and training, another 9% work in IT and telecommunications, and 7% work in healthcare”.

  1. Invest €246,000 in a flat, on average

The study also reflects the average amount that Spaniards spent last year when purchasing their homes.

Overall, homeowners that bought a flat invested an average of €246,000; those who purchased an apartment paid €142,000 on average; and those opted for terrace and semi-detached houses spent an average of €333,000.

In addition, the analysis shows that there are significant differences in the amount invested according to the age of buyers. Spaniards aged between 45 and 55 invested the most in their homes in 2014, specifically €205,984 on average, followed by those aged between 35 and 44, who spent €189,609, and young people aged between 25 and 34, who last year invested €175,456 on average buying a home.

  1. Primary place of residence

In terms of the use of the houses purchased, the report by reveals that 67% of homes were purchased to be the buyers’ primary residence; followed by 16% that were bought for investment purposes, with a view to accessing the equity in the future; and 15% who bought property as a second home (2% did not specify).

Original story: Expansión (by B. Amigot)

Translation: Carmel Drake

TINSA: House Prices Fall By 3% In 2014 And May Bottom Out In 2015

 14 January 2015 – Expansión

The price of finished housing (new and used) declined by 3% year-on-year in 2014, compared with a 9.2% decrease in 2013, according to Tinsa’s General and Major Markets IMIE Index, published today. The appraisal company believes that prices could break even during the first few months of 2015.

The five areas analysed in the study show that the deterioration in prices has moderated over the last year. Specifically, the ‘Metropolitan’ area recorded a decline of only -0.2%, compared with -11.5% in 2013.

The ‘Balearic and Canary Islands’ recorded a decrease of -2%, which is not far off the -3.2% recorded in those regions in 2013; and ‘Capitals and Major Cities’ recorded a fall of -2.8%, versus a reduction of -11% in 2013.

“The most significant variations over the last twelve months were recorded in ‘Other Municipalities’ (-4.7% year-on-year) and on the ‘Mediterranean Coast’ (-4.5%)”, said Tinsa.

From the highs of 2007, the IMIE, which stood at 1,343 points in December (the same level as in July 2003) has recorded a cumulative decline of 41.2%.

The evolution of prices in 2015 will depend on the economic situation and the level of employment, which will determine demand, says Tinsa. “If growth forecasts are fulfilled, the labour market stabilises and the proposed improvements in lending are realised, then the average price of housing in Spain may break even during the first few months of the year, with a year-on-year variation of around 0%”, it concludes.

Original story: Expansión (by M. G. Mayo)

Translation: Carmel Drake

INE: House Sales Increase By A Further 14% In November

13 January 2015 – El Mundo

The housing market recorded its third consecutive monthly rise to take the cumulative annual increase to +1.1%.

Sales of existing homes monopolised the market, accounting for 69.2% of all transactions (25,200).

Purchases of existing homes soared by 41.6%, whilst purchases of new homes decreased by 20.6%.

The largest increases were in Navarra (48.2%), La Rioja (33.3%) and Asturias (30%).

The housing market appears poised for a comeback according to latest sales figures. Perhaps, the best sign yet of the real estate recovery. During the month of November, the number of house sales increased by 14%, according to the National Institute of Statistics (INE), with 25,200 transactions recorded.

This significant increase in activity is the third consecutive monthly rise. Furthermore, the increase reached double digits, in line with the previous two months (+13.7% in September and +16% in October). By contrast, in terms of the month-on-month trend, there were -4.8% fewer transactions in November than in October.

Following these recent positive year-on-year developments, the cumulative balance over the last year is generating “green numbers”. During the first 11 months of 2014, +1.1% more homes were transferred and acquired than during the same period in 2013.

The main driver behind this resurgence in sales is the market for existing homes, which accounted for 69.2% (17,433) of all transactions, representing a significant increase of 41.6%. By contrast, sales of new homes fell by 20.6% year-on-year, to reach 7,767.

On the other hand, 90% of the homes sold in November were unsubsidised (“libres”) (22,675) and 10% were subsidised (“protegidas”) (2,525). In annual terms, the number of unsubsidised homes sold increased by 11.8% and the number of subsidised homes sold rose by 38.7%.

Only Cantabria and Valencia recorded “red numbers”.

All of the autonomous communities recorded positive year-on-year variations in house sales, with the exception of Cantabria (-12.3%) and Valencia (-3.3%). The largest increases occurred in Navarra (48.2%), La Rioja (33.3%) and Asturias (30%). Other regions that recorded above average growth rates included Cataluña (+19.9%) and Madrid (+19,.2%), amongst others.

In terms of sales recorded per 100,000 inhabitants, Valencia, Andalucía and Navarra headed the ranking, with 91, 81 and 81 transactions, respectively.

Original article: El Mundo

Translation: Aura REE