Uncertainty Causes Volume of Transactions in the Housing Market to Fall by 3.1%

10 September 2019 Spain’s College of Registrars reported that 130,088 homes were sold in the second quarter of this year, a fall of 3.1% year-on-year and 2.8% q-o-q. Market sources attribute the fall to the uncertainty generated by the new Mortgage Law and the failure of the country’s political parties to form a government after elections in April.

Sales of new homes stood at 22,209 units, down 12.8% q-o-q, while those of existing housing fell by 0.5% to 107,879.

Original Story: Idealista

Adaptation/Translation: Richard D. K. Turner

Bank of Spain: Spain’s Housing Market is Not Overvalued

9 June 2019 – Eje Prime

The Bank of Spain does not think that a real estate bubble exists. The institution’s Director General of Economics and Statistics, Óscar Arce, has assured that the bank does not consider that the housing market is “overvalued in general”. Nevertheless, he is following the sector “very closely” given its history.

Arce highlighted several differences between the current climate and the previous cycle including the fact that price rises now are not uniform across all regions or cities. In fact, according to the latest data published by the Bank of Spain, average house prices rose by 6.8% YoY during Q1 2019, driven by Madrid, Barcelona, some parts of the coast and the islands.

Original story: Eje Prime 

Translation/Summary: Carmel Drake

La Generalitat Approves a Law to Limit Rental Prices in Cataluña

21 May 2019 – Eje Prime

The executive led by Quim Torra has approved a royal decree to limit residential rental prices in Cataluña so that they will not exceed 10% of the reference index in neighbourhoods and cities with an “accredited lack of affordable housing”.

That percentage increases to 20% in the case of new or completely refurbished homes for the five years following the building work. Meanwhile, for flats with exceptional views, swimming pools or gardens, the percentage may rise to 25%.

The decree considers areas with a “tense housing market” to be those municipalities where the provision of affordable rental housing is at risk. In particular, it makes reference to towns where rental prices have grown sustainably by more than average and where the increase in the demographic density is not being matched by the growth in the housing stock, amongst other factors.

Original story: Eje Prime

Translation/Summary: Carmel Drake

Bank of Spain Warns of Mismatch Between Housing Supply and Demand

11 April 2019 – El Confidencial

According to the Bank of Spain, there is a mismatch between the homes that buyers are demanding and those that are available for sale. Indeed, that is one of the main conclusions of the latest report published by the supervisory body entitled the “Recent evolution of the housing market in Spain”.

According to the report, one of the key characteristics of the Spanish property market is its high degree of heterogeneity by region, type of home (new and second-hand) and buyer nationality. “The characteristics of the homes demanded do not necessarily match with the available supply, in certain places, and may differ in terms of size, quality and location”.

In addition, the Bank of Spain warns about the difficulties that young people are facing when it comes to affording a home, as a result of their precarious working conditions. Their situation is further compounded by changes made in recent years regarding tax breaks (the removal of them) for buying a home and the growth of the rental sector.

The Bank’s analysis focuses on Madrid and Barcelona, which are both very close to the peaks of the boom in terms of rental prices. Meanwhile, house prices are currently around their 2006 levels.

Nevertheless, according to the report, it does now seem easier to obtain a mortgage or at least one with more favourable terms for the borrower. Interest rates have decreased and lending periods (mortgage terms) have increased. Approval criteria and general financing conditions have also been relaxed.

Original story: El Confidencial (by E.S.)

Translation/Summary: Carmel Drake

Pisos.com: House Sales will Amount to 520,000 in 2018

29 November 2018 – Expansión

The housing market is going to break a record in terms of sales in 2018, by exceeding the 500,000 threshold for the first time since 2008. The strength in demand and the pull of the large capitals is going to translate into 520,000 house sales this year, up by 13% compared to 2017, according to forecasts from the portal Pisos.com.

On the other hand, the dynamism of the market and the shortage of available supply in the areas where demand is greatest will continue to cause prices to increase. They could close this year with a rise of 6%, with a price per square metre of €1,700/m2, and in 2019, flats will cost between €1,750/m2 and €1,800/m2 on average.

In terms of forecast house sales in 2019, the Head of Research at Pisos.com, Ferran Font, explained that “these figures will be maintained, given that the upwards trajectory is close to reaching its reasonable ceiling”. “Over the next few years, we expect the sector to close between 500,000 and 600,000 sales per year. If that figure were to increase to 800,000, it would be a bad sign for the sector”, added Font.

The arrival of investors into the real estate market explains part of the upwards performance of the sector. 25% of house sales were made without the need for financing, “which shows that property is serving as a good refuge for investment during the period of low interest rates”.

Andalucía, Cataluña and Madrid are the autonomous regions where most house sales are taking place. Nevertheless, the entry of the Community of Valencia into the leading regions is worth noting. According to Font, it is a growing market, where there is a lot of activity. As a result, the Community of Valencia is where there are the most sales for every 1,000 inhabitants. Meanwhile, Madrid will close the year with 78,000 house sales, up by 13% YoY to account for 15% of the national total.

In Barcelona, by contrast, “there is a change in the trend”, warns Font. The increase in house prices that the Catalan capital experienced at such high rates during 2016 and 2017 has reached its peak in 2018.

As a result, demand is moving to other towns. “Initially, it was moving towards the outskirts, but now it is moving towards adjoining municipalities” noted Font.

The maximums reached in the Catalan capital and the reorientation of demand are having an effect on the number of sales registered in Barcelona. At the beginning of 2017, Barcelona was growing at double-digit rates. But by the end of last year, sales had started to moderate, and during the first quarter of 2018, they started to register YoY decreases of 17% (…).

Original story: Expansión (by I. Benedito)

Translation: 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

Servihabitat: Spain’s Housing Market Continues on its Positive Trajectory

24 July 2018 – Eje Prime

The housing market in Spain is going to continue with positive figures across all areas in 2018. That is according to a report from Servihabitat, which indicates that prices are going to continue to rise this year, up by 5.4%; operations are going to soar, with a leap of 24%; and new build starts are going to rise by 16.6% (all figures compared to last year).

According to the report, these increases respond to a residential market that “is progressing with clear signs of consolidation”, which is explained by factors such as an improvement in consumer confidence, the containment of unemployment and the positive evolution of companies’ turnover.

These elements “are encouraging the start of housing projects and configuring an expansive cycle”. With a special focus on the largest populations in Spain, such as Madrid, Barcelona, Málaga, Valencia and Sevilla, in the case of homes for regular use, and on regions such as Galicia, La Rioja, the Community of Valencia and the Canary Islands, the number of new home starts will rise by 16.6% this year to 93,895 units.

Meanwhile, the number of finished homes will rise by 15.5% during the course of this year, according to Servihabitat’s forecasts, with a total of 63,744 homes delivered. Despite that, the pull of demand will reduce the new build stock by 4% to 454,939 homes, with a greater reserve in the communities of Cataluña, the Community of Valencia and Andalucía (the three account for 49% of the total stock).

The second major increase will be seen in the number of transactions, in other words, the sale of homes signed at the notaries’ offices. According to the report, the year will close with a total of 669,739 transactions subscribed, up by 24.3% compared to 2017.

Macroeconomic conditions, together with opening up of the financial sector to the granting of mortgages and demand for property investment (thanks to the returns that the rental market is offering) are the three main drivers of demand, which have reduced the average sales period for a normal home to 6.6 months.

Finally, the evolution of supply and demand will lead to a rise in house prices once again this year, up by 5.4%, compared with an increase of 6.2% with respect to the previous year.

Prices are expected to grow by the most in the Community of Madrid, with a forecast increase of 11.5%; followed by Cataluña, 9.6%; the Balearic Islands, 8%; and País Vasco, with an expected increase of 5.2%. By contrast, prices are forecast to rise by less than 1% in the autonomous regions of Extremadura and Castilla-La Mancha in 2018.

The report also reflects the opinions of the real estate agents who form part of Servihabitat’s own network of branches and its collaborating agents. In particular, 64.2% of that sample believes that the price of regular homes (primary residences) will remain stable in 2018, compared with 33.2% who think that they will rise and just 2.6% who consider that prices will fall. In the case of holiday homes, the dispersion is somewhat greater: 34% forecast that prices will rise this year; 62.6% think they will remain stable and 3.4% believe that they will fall.

Original story: Eje Prime (by C. de Angelis)

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

Citibox Seduces the RE Market & Signs Agreements with Merlin, Colonial & Aedas Homes

22 November 2017 – Eje Prime

With just 48 hours to go until Black Friday, Citibox is busy working on a multiple-pronged strategy. The real estate proptech firm is getting ready for the big e-commerce day of the year, when Spanish consumers are expected to spend more than €1.4 billion online. On 24 November alone, many online businesses generate between 10% and 30% of their annual sales.

This fact directly affects Citibox, a Spanish company that in just two years has signed agreements with the kings of the Socimis, Merlin and Colonial, as well as with property developers such as Vía Célere. And all thanks to its intelligent lockers (or boxes, as they call them), storage spaces “that enable us to ensure that anyone can receive the package they are waiting for without having to be there in person”, says Félix Navarro, Director of Citibox, speaking to EjePrime. The firm has already installed 2,500 boxes in Madrid and Barcelona, the two cities where they currently have a presence.

Created in Valencia in May 2015, the proptech firm has a system whereby each one of its boxes is permanently connected to its own app. As a result, the parcel service is able to deliver a package to the user in the box that he/she chooses in advance and “once there, a password allows the delivery person to place the package in the corresponding space”. Once the package has been delivered, the recipient receives a message on his/her mobile device informing him/her that the package is ready to be picked up”, explains Navarro. “This satisfies the user and also the delivery companies, given that it saves them money and time by ensuring in advance that the delivery of its parcels will be successful”, says the Citibox executive.

According to research, 84% of people want to receive their parcels at home, and with the e-commerce boom, “online buyers have become more demanding”, says Navarro. A report from Cushman & Wakefield indicates that the rate of growth of the Spanish digital market is 19%, faster than any other country in Europe. Citibox wants to build on this – it already has a presence in the residential sector and in offices, through a series of models.

In the case of the housing market, the proptech firm offers communities of neighbours the opportunity to install its boxes. The only condition is that the block has at least 50 residents. Nevertheless, where the company really comes into its own is in the new urbanisations that currently being built, given that it has been reaching agreements with the most important Spanish property developers. In the Community of Madrid, it is already working with Vía Célere, in Villaverde, and with Grupo Roca in Getafe, in two residential complexes that are about to be handed over to their new owners. Moreover, the company has framework agreements in place with other companies in the sector such as Aedas Homes, Corp and Acciona. (…).

In this sense, one of the points that the company highlights is that “the investment is made by the user upfront: no payment is required for the services, regardless of the number or frequency of deliveries”, says the company’s Marketing Director.

Merlin and Colonial 

In the office sector, Citibox operates for the two largest players in the real estate sector. Merlin has boxes in its Muntadas I and I buildings, whilst Colonial has an agreement with the company for its Sant Cugat Nord asset. Moreover, the proptech is present in the headquarters of Mutua Madrileña, Catalana Occidente, P&G, Saint Gobain and Just Eat, amongst others (…).

Citibox was created with five employees, including its CEO, David Bernabéu, and in just two years, its workforce has grown to include 50 people, and “we are still growing”, says Navarro.

Boosted by this growth, the company is now thinking about its expansion overseas. In 2018, Navarro is confident that “we can be present in the main European markets, such as in France, Germany and the UK”. (…).

Original story: Eje Prime (by Jabier Izquierdo)

Translation: Carmel Drake