Moroccans and Romanians Among the Biggest Foreign Buyers of Homes in Spain

20 August 2019

The profile of foreign home buyers in Spain is changing as traditional European countries are now accounting for a diminishing percentage, according to a report by the Spanish College of Registrars.

Between January and March, foreign buyers acquired more than 16,000 homes in Spain, approximately 12% of all operations. The British accounted for 13.79% of the total, down from a high of from 37% in 2008. The French also fell from 10% in 2014 to 7.5% in the first quarter of this year. Germans fell to 6.89%, and the Italians dropped to 4.91% from 5.77% in 2017.

Moroccans are now the fourth most active buyers (6.14%), while Romanians are the fifth (6.12%), followed by the Belgians (5.41%), Italians (4.91%) and the Chinese (4.49%).

Original Story: Idealista – Ana P. Alarcos

Adaptation/Translation: Richard D. K. Turner

International Buyers Now Account for Just 20% of Luxury Home Sales in Barcelona

20 August 2019

Luxury homes in Barcelona are attracting fewer foreign buyers than just a few years ago. At that time, they accounted for 50% of all transactions, while now that has fallen to one in five.

Several factors have combined to lead to the decline. According to Barnes, a real estate agency, Spanish buyers have become more prevalent, while foreign buyers have increasingly turned their attention to other places like the Balearic Islands, Greece, and Portugal. Geopolitical factors such as the independence movement in Catalonia have also taken a toll.

Original Story: Idealista

Adaptation/Translation: Richard D. K. Turner

INE: House Sales Rose by 3.7% YoY in Q1 2019

14 May 2019 – Idealista

According to data from INE, 133,989 homes were sold in Spain between January and March 2019, which represents a YoY increase of 3.7%. It also represents the best quarterly sales figure since the spring of 2008.

Nevertheless, it is worth noting that the volume of monthly sales actually decreased during the quarter from 47,000 in January, to 43,700 in February and 42,700 in March. Second-hand properties accounted for most house sales during the period, specifically 81.1% in March, although the volume of new build transactions did grow by 14.4% during the quarter.

By autonomous region

Andalucía, Cataluña and Madrid continued to lead the ranking in terms of the regions with the most transactions signed, with 8,915, 6,904 and 6,233 units sold, respectively.

Despite the strong results, Fernando Encinar, Head of Research at Idealista urges caution in light of the new Royal Decrees published in recent months. They are generating uncertainty in the market and so are slowing down growth – families and investors alike are deciding not to use their savings to buy a home and rent it out, in the short term at least, and that trend may become more widespread over the coming months.

Original story: Idealista

Translation/Summary: Carmel Drake

Traffic Restrictions in ‘Madrid Central’ Drive up Parking Space Prices

16 March 2019 – El País

The Town Hall of Madrid, led by Manuela Carmena, introduced new traffic restrictions in the city centre (Madrid Central) in November last year on a provisional basis. As of Saturday 16 March, fines are now being levied on vehicles that enter the area illegally.

Only those vehicles owned by people who own or lease a parking space within the designated area may access the area, regardless of the environmental label assigned to their vehicles, if they are not residents. As such, parking spaces are in demand and so their prices have soared in the last 4 months.

In fact, prices have risen by between 20% and 30% following the imposition of the traffic restrictions. For a parking space that used to cost €20,000, vendors are now asking €25,000, and for a space costing €40,000 previously, vendors are now asking between €45,000 and €48,000, according to Daniel Lucía, founder of the company ParkingYa!, created twenty years ago and which sells more than 250 parking spaces per year.

According to Pisos.com, the average price of a parking space in the Centro district is now €52,100. In the Spanish capital in general, the average price amounts to €21,300. Moreover, even though the prices of parking spaces rose by between 10% and 20% across Spain in 2018, they are still 30% cheaper than in the years before the real estate bubble, when parking spaces in Centro and Salamanca were sold for €90,000 or €100,000.

These assets generated stable returns of 6.2% across Spain in 2018, compared with 5.5% in 2017, according to Idealista. In Madrid, the yield was 3.4%, although that figure varied by district. Location is key, as that typically determines the ease with which a space can be leased. Parking spaces in the city centre are always less profitable (generating less than 4%) than those on the outskirts but they are safer investments as are rarely unoccupied.

Original story: El País (by Sandra López Letón)

Translation/Summary: Carmel Drake

Ministry of Development: 100,733 New Build Permits were Granted in 2018

28 February 2019 – Idealista

In 2018, 100,722 building permits were granted to construct new homes, 25% more than a year earlier; a figure not seen since 2009, when 110,849 permits were granted, according to data from the Ministry of Development. Of the total figure, 79,453 were granted to build blocks of flats and 21,254 to build houses.

In this way, building permits have now recorded five consecutive years of increases. In 2013, they hit a historical low (34,288 units), a figure that represented a decline of 96% from the peak year of 2006 when 865,561 permits were granted.

Despite the good results in 2018, the construction sector considers that a healthy market is one that is capable of generating around 150,000 new work permits per year.

Why is it so hard to build 150,000 homes per year?

Daniel Cuervo, Director at Asprima, points to several factors:

– Building permits take a long time to be granted (…). In general, Town Halls take 14 months to grant a licence, on average (…).

– Financing has returned to the real estate sector, but it is not immediate (…).

– Urban planning in Spain is paralysed due to the high level of legal uncertainty (…).

Meanwhile, Daniel del Pozo, Director at Idealista/News, provides some additional explanations:

– Lack of awareness about how the market works and of the real demand by the Public Administration (…).

– The main land portfolios are owned by the banks, Sareb and the funds (…) which are all waiting for prices to rise before releasing the most sought-after plots.

– The political uncertainty, the threats of interventionalism and/or changes in regulation in the real estate market also play their role (…).

Original story: Idealista 

Translation: Carmel Drake

Stoneweg Buys Plot to Build Luxury Apartments for €130M

13 December 2018 – Idealista

The real estate market has broken a new record in Madrid: the Spanish-Swiss fund Stoneweg has purchased a residential plot from Dragados for €130 million, the most expensive operation in the history of the capital, according to Idealista News. The plot, located on Paseo de la Dirección, 246, spans 40,000 m2 and two luxury residential towers are going to be built on the site, which will be sold for €6,000/m2.

The project, which is going to be constructed by Dragados, comprises two towers that will have 700 homes in total, and which will go on sale for around €6,000/m2. The land will also be home to two tertiary-use towers, destined for offices, which do not have an operator yet. The operation has been advised by the firm Colliers.

According to sources consulted by Idealista News, these two towers will change the skyline of Madrid and will open the door to a change in the physiognomy of the Tetuán district. The property developer is whereby continuing to take advantage of the real estate cycle and, specifically, of the good times that the luxury residential business is experiencing, which is attracting attention from local and international buyers alike.

Over the coming weeks, Stoneweg is going to open a selection process to choose a company to take care of the sale of the 700 luxury homes. Candidates are expected to include CBRE, Savills-Aguirre Newman, BNP and Colliers (…).

Original story: Idealista (by Custodio Pareja, P. Martínez-Almeida & Ana P. Alarcos)

Translation: Carmel Drake

Idealista: House Prices Soar by 18%+ in Madrid, Málaga and Las Palmas

3 November 2018 – Expansión

In October, the residential market recorded its largest increase in 2018. House prices rose by 10.5% on average across Spain in year on year terms, after recording an average cumulative increase of 7.7% during the first nine months of the year, according to the latest data published by the real estate portal Idealista.

But although the growth is generalised across Spain, it is the large capitals that are driving the sector. “Prices are continuing to rise in a general way, but they are doing so at two speeds. Whilst in half of the markets, the YoY growth rates are in the single digits, it is the major capitals that are responsible for the YoY growth of more than 10% that is being seen across Spain as a whole”, said Fernando Encinar, Head of Research at Idealista.

House prices are rising at double-digit rates in 15 Spanish capitals. More specifically, Las Palmas de Gran Canaria, Madrid and Málaga are leading the charge. House prices in Las Palmas de Gran Canaria soared by 21.2%, the largest increase across the whole country, taking the average price there to €1,929/m2.

They were followed by Madrid, where, despite the overheating of the market (the average price of €3,827/m2 is only exceeded by Barcelona and San Sebastián), house prices rose by 19.2%. In third position, Málaga saw an increase of 18.8%, to €2,229/m2.

The residential sector in Málaga, which bottomed out in 2013, has been experiencing an increase in its recovery, boosted by its tourist appeal. “In addition to Barcelona and Madrid, certain other capitals, such as Málaga and Palma de Mallorca, are joining the previous two (…) with more acute increases than the rest, above 5% in all of them”, explain sources at Sociedad de Tasación.

Currently, the Málagan capital is one of those that makes up the second wave of cities that are leading the house price increases. “Despite these increases, none of the capitals has reached the peaks of 2007, with the exception of Palma”, added Encinar.

Finally, at the bottom of the pile are those inland provincial capitals, where depopulation and less economic dynamism are hampering the evolution of the sector.

Specifically, prices in Ávila fell by 2.4%, in Jaén by 1.6%, and in Teruel by 1.2%. Meanwhile, prices recorded moderate decreases in A Coruña, Oviedo and Ourense of 0.6%, 0.5% and 0.2%, respectively.

Nevertheless, the greatest correction in prices was experienced in Tarragona, with a decrease of 2.8%, in line with the deceleration of the market in Barcelona, where house prices rose by only 1.1%.

Original story: Expansión (by Inma Benedito)

Translation: Carmel Drake

PDeCat Sells its HQ in Barcelona to An Asian-Catalan Fund for €8M

1 October 2018 – Idealista

The Catalan European Democratic Party (PDeCat) has hung the “sold” sign up over what is currently its headquarters, after a series of negotiations with several funds. The Catalan political party has completed the sale of the building to an Asian-Catalan fund led by the businessman Joaquim Zamacois, according to sources close to the operation speaking to Idealista News. In the end, the consideration paid amounted to €8 million.

The office building has a surface area of more than 2,100 m2 and was put on the market for an initial asking price of €7.4 million. The asset, owned by the Catalan political party until now, is located at number 339 Calle Provenza. The PDeCat, which put the property on the market because it is “too large for its needs”, will move to another building and leave this property vacant for a new operator.

The asset is registered in the name of the (now dormant) political party ‘Convergència Democràtica de Catalunya’ (CDC), although it has been used by its PDeCat heirs. This is not the first real estate transaction that the party has closed: three years ago, CDC sold its previous headquarters on Calle Córcega to the Hong Kong-based fund Inversión Platinum, which subsequently converted that building into high-end homes.

The decision to put the headquarters on the market was taken in the summer of 2017, although it was not advertised until December after the Catalan elections had been held. To fire the starting gun, PDeCat placed an advert in local newspapers announcing the sale.

The building, which as well as being used for offices could also be converted into homes, has housed a number of tenants over the years. In the past, the property was leased to the Trade and Energy Departments of the Generalitat de Cataluña.

Sale in the middle of the ‘procés’

The sale of the building came on the first anniversary of the illegal referendum held on 1 October 2017. Over the last year, although the political instability has not had a significant impact on the real estate sector in Cataluña, it did cause investor interest to suffer during the final quarter of last year.

According to data from the real estate consultancy CBRE, real estate investment in Cataluña amounted to €2.093 billion in 2017, down by 17% compared to the previous year, although experts in the sector indicate that one of the problems was a lack of supply, rather than a lack of demand.

Nevertheless, the professionals in the sector agree that the data for the last two quarters has been improving in Cataluña, with operations such as the sale of PDeCat’s headquarters serving by way of example. Moreover, the outlook is positive: “For example, if we focus on the office investment market, data for the third quarter of 2018 is better than for the same period in 2017”, explain sources at the real estate consultancy Cushman&Wakefield.

Original story: Idealista (by Custodio Pareja)

Translation: Carmel Drake

Spain’s New Gov’t to Promote Construction of 20,000 Affordable Homes for Rent

12 July 2018 – El País

The Ministry of Development is preparing an ambitious range of measures to increase the supply of rental homes, put a stop to escalating prices and facilitate access to housing for young people and low-income families. Its proposals include a plan to build 20,000 rental homes, which will be allocated at controlled prices in cities where prices have soared, according to sources speaking to El País. Moreover, the Ministry wants to extend the duration of rental contracts from three to five years, limit damage deposits and stimulate the supply of rental housing with tax incentives and the moderation of rents.

More funding, regulatory changes and a tax reform are the three components of a broad plan through which the Ministry of Development says it wants to give a social twist to the housing policies and whose main lines will be announced in Congress today by their owner, José Luis Ábalos. The objective is to avoid a new housing price bubble from destabilising the economy once again, according to government sources, and, in particular,  to help families with limited resources and young people.

The package includes urgent measures aimed at alleviating the increase in rental prices, which have soared by up to 50% in large cities over the last four years due to the emergence of tourist apartments and the reactivation of the real estate market. The Government is going to launch an inter-ministerial working group tasked with developing a set of urgent policies for housing and rent.

Amongst the initiatives that the Ministry of Development is going to implement is a plan to build 20,000 affordable rental homes over the next four to six years. The State will promote the construction of these 20,000, mostly public, homes (although this has not been finalised and all of the possible formulae are going to be considered because the most important thing is for the homes to be built quickly). The homes will be destined for rent or transfer of use, for an indefinite period, with a limited rent or price, in cities with accredited demand and where rental prices are higher.

Palma de Mallorca, Las Palmas, Barcelona, Valencia, Madrid, Málaga, San Sebastián and Sevilla are the cities that have experienced the largest increases in rental prices over the last four years, which have risen by up to 50% on the islands, according to data from Idealista.

Last year in Spain, work was completed on 48,853 private homes and 4,938 social housing properties, according to data from the Ministry of Development. At the height of the real estate bubble, in 2007, almost 650,000 homes were being constructed per year.

The plan will be carried out in collaboration with autonomous communities and town halls, which will be asked to identify and facilitate the most appropriate plots of land on which these housing developments can be built. The State will involve SEPES, the public land entity, in this program and will contribute its own momentum and financial support. The ICO will also play a role in the design of the policies (…).

Original story: El País (by Elsa García de Blas)

Translation: Carmel Drake

Bankia Puts Branch in Barcelona’s Plaza Cataluña Up For Sale for €28M

5 July 2018 – Idealista News

Bankia is replicating in Barcelona what it has already done in Madrid with c/Alcalá 1. The bank has put up for sale the commercial premises in the building that it owns at number 9 Plaza Cataluña, in the centre of Barcelona, for €28 million.

The entity opened the bidding last week and will start to receive offers for the premises, which have a surface area of 1,000 m2, from Friday 6 July onwards. The asset, located between the Apple and Desigual flagship stores, has already attracted several suitors, including retail operators and international investment funds, according to Idealista.

The premises, which Bankia debating whether to put up for sale or lease, was the object of desire of the Japanese fashion giant Uniqlo for its arrival plan in Barcelona. In the end, that firm opened its flagship store close to Plaza Cataluña, at the intersection of Gran Vía and Paseo de Gracia.

This operation follows the deal that Bankia already initiated in March involving c/Alcalá 1 in Madrid, as revealed by Eje Prime. For that central property in the Spanish capital, two real estate funds, Renta Corporación and Arcano, are still the favourites to acquire the asset, which, nevertheless, has not yet been sold for its minimum asking price of €20 million.

Original story: Idealista News

Translation: Carmel Drake