Tag: idealista

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

Spain’s Banks Are Queueing Up to Finance Rental Housing

4 July 2018 – El Economista

One of the major challenges facing Spain in the residential market is the organisation of the rental home segment in light of the fragmentation that exists and the boom that is currently underway. There is currently a great deal of demand, but there is also a distinct lack of supply, and the new Housing Plan approved by the Government is not proving sufficient to incentivise the supply with the granting of aid to property developers that build rental housing. In light of this situation, we ask ourselves whether the opportunity that currently exists in Spain to organise the rental market is being taken advantage of?

“I think that the professionals and investors who have launched portfolios thanks to the creation of Socimis are taking good advantage of the opportunity, but I believe that some important players are simply not supporting the sector, such as the Public Administrations. Both nationally and locally, but above all locally, they are failing miserably and this is generating price tensions due to a lack of supply”, explains José Luis Ruiz Bartolomé, Director General of the consultancy firm Chamberí Asset Management.

Along the same lines, José María Cervera, Corporate CEO of Renta Corporación agrees and states that the public sector has been left on the sidelines. “Private capital has taken the initiative in this new segment of the market because it has seen a business opportunity and is looking for returns. And the public sector is going to have to enter, but now the arbitrage and those who are institutionalising it are in the private sector, and so they are going to place more rental properties on the market”.

For all of these reasons, during 2018, we are observing the creation of a new industry. Given that in Spain there are 18.5 million households, according to the latest figure from the Active Population Survey (EPA), and of those, 22% are rental homes, there are 4.7 million rental homes in total. Of that portfolio, only 5% are owned by institutional companies; the remaining 95% are owned by individuals.

“The Public Administration has done something important, which is to reorganise the real estate sector and separate property promotion and development activities, by creating Socimis that operate under a special framework. That has brought us closer to a situation that is more similar to those seen in other European countries. Now, we will have to see how the different players that are emerging in this market position themselves, and in two or three years, we will see the consolidation of this sector, which means that the Public Administrations will have to continue refining their regulations so that the sector can develop and be brought into line with those of other European countries”, says Nicolás Díaz-Saldaña, CEO at Témpore (Socimi of Sareb).

Nevertheless, not all of the experts in the sector concur. David Botín, Director of Real Estate Development at the ACR Group, says that this opportunity is not being leveraged. “It is possible that we are seeing the beginnings of a new rental market, but to date, just 22% of our households are renting and that supply is being provided almost exclusively by individuals. As such, it is very hard to fathom how we will reach the percentages seen in other countries such as Germany, where rental properties account for 48.3% of the market or the United Kingdom (36.6%). It is really hard to increase the stock in Spain because there are 19 million homes, and so a 1% increase means placing 190,000 more homes on the rental market, and that would take between three and four years (…). At that rate, nothing is going to happen quickly. No market works if there is no equilibrium between supply and demand. We need a large and varied supply for this market to work effectively”, he adds.

It is true that, historically, Spain has been a country of property owners, but the cultural and socio-economic changes that have been happening in recent years are drawing some new business lines, where the rental market is taking centre stage and is starting to become institutionalised. The new players in this market are: on the one hand, the Socimis, which are listed companies that serve as investment vehicles with tax benefits. The largest of them is Testa, which will debut on the stock market soon and which is owned by Santander, BBVA, Acciona and Merlin Properties. There are also others such as Azora, Vivenio (Renta Corporación), Témpore (Sareb) and Fidere, amongst the largest. Within this market, we can also include the servicers, which although they do not own properties, manage them, such as Solvia (Sabadell), Anticipa (Blackstone), Haya (Cerberus), Altamira (Apollo and Santander). And then, there are companies owned by the banks, such as Building Center (Caixabank) and other types of companies such as Alquiler Seguro, family offices, etc.

Therefore, now that the new players required to institutionalise this market are starting to be created, the next step is to develop a portfolio of assets. “We are going to need to reach agreements with property developers to build homes for rental (…), and at Sareb, we are going to use some of the land that we have for the co-development of rental homes (…)”, says Nicolás Saldaña.

That is a formula that is starting to spark interest. According to the experts, property developers have always been reluctant to enter the rental market, because they didn’t see it as their business, but in the end, the market trend has changed and whilst the sale and purchase segment will continue to exist, so too will the rental sector and property developers will have to participate (…).

The rental segment is a market that has always existed in the hands of individuals, but now, it is being professionalised, thanks to the arrival of overseas capital. “Investors have contributed many things, besides capital. They have contributed methodologies, rigour, professionalism (…). The banks were not open to this business before, they only financed promotion, but that has changed. For six months now, everyone has been wanting a piece of the pie and now there is a queue of financial institutions wanting to finance this type of business (…)”. Says José María Cervera (…).

Investing in residential properties is profitable. The gross return from investing in rental homes has increased to 7.3% from 6.3% a year ago, due to the strength of demand for rental properties, according to the real estate portfolio Idealista (…).

Original story: El Economista (by Luzmelia Torres)

Translation: Carmel Drake

INE: The Number of Mortgage Signings Soared by 34% YoY in April

27 June 2018 – Expansión

The number of mortgages constituted over homes in Spain amounted to 28,724 in April 2018, which represents an increase of 34.2% compared to the same month in 2017.

According to data published today by Spain’s National Institute of Statistics (INE), the increase with respect to the month of March was 9%. In terms of the cumulative numbers so far this year, the increase amounts to 11.6%.

Meanwhile, the capital loaned rose by 46.5% in April 2018, compared to April last year, to €3.5 billion. Moreover, the average amount loaned in April of this year amounted to €123,256, up by 9.1% in YoY terms.

By nature of property, mortgages constituted over homes accounted for 64.7% of all the capital lent in April.

For mortgages constituted over homes, the average interest rate in April 2018 was 2.67% (16.7% lower than in April 2017) and the average term was 24 years. 60.6% of mortgages over homes were constituted at floating rates and 39.4% at fixed rates. Fixed rate mortgages experienced a 30.7% increase in YoY terms.

The average interest rate at the beginning of a mortgage term is 2.42% for floating rate mortgages over homes (a decrease of 22.3%) and 3.15% for fixed rate mortgages (6.1% lower).

Fernando Encinar, Head of Research at Idealista, considers that the “significant increase in the volume of mortgages registered in April with respect to last year should be adjusted for the effect of Easter, although even taking the sum of March and April in both years, the increase is still a healthy 12%”.

According to him, “the banks are still willing to grant mortgages, they are opening their hands slightly, but they are not the motors behind the rise in house sales. Fixed rate products are rising slightly with respect to floating rates, and so are the prices of them, undoubtedly the result of more expensive financing. Even so, more mortgages are still being repaid than registered”.

For Ferran Font, Head of Research at pisos.com, these data confirm “that in March, we were not looking at a change in trend, but rather the effect of Easter, which fell in April in 2017. That percentage strengthens the growing trend in recent months, after a month of negative YoY growth”.

By region, the autonomous regions with the highest number of mortgages constituted over homes in April was the Community of Madrid (6,018), Andalucía (5,154) and Cataluña (4,700).

Meanwhile, the highest YoY variation rates were recorded in the Balearic Islands (66.7%), the Community of Madrid (62.4%) and Castilla-La Mancha (54.2%).

The autonomous regions where the most capital has been loaned for the constitution of mortgages were the Community of Madrid (€997.9 million), Cataluña (€708.1 million) and Andalucía (€531.8 million).

In total, 40,005 mortgages over properties were signed in April, up by 36.5% with respect to a year earlier. Of the total, 1,350 corresponded to rural properties (+21.4%) and 38,655 to urban assets (+37.1%).

Original story: Expansión 

Translation: Carmel Drake

Gesvalt: House Prices Will Grow by 5%-7% in Spain in 2018

15 June 2018 – Eje Prime

Gesvalt predicts that house prices will continue to rise this year. According to Sandra Daza, the Director General of the company, the price of residential properties in Spain will grow by between 5% and 7% this year in the main cities across the country. “We are not laying the foundations for a new real estate bubble, sales are going to continue to grow and prices will maintain their upward trend”, explained the executive in the framework of Inmonext.

The surveyor explained that, in 2017, “more than half a million homes were sold, the economy grew by more than the European average, minimum interest rates continued to encourage the diversification of investment portfolios and last year, €14 billion was invested in property, up by 45% compared to a year earlier”. “We can say, without fear of being wrong, that Spain is an interesting market for investment”, she said at the event organised by Idealista.

Although she acknowledged that the lack of political stability is affecting the sector, she also argued that the appetite from investors for domestic assets is still very high.

In some sectors, such as offices, there is a lack of high-quality products, whilst in other sectors, such as shopping centres and logistics, there are opportunities. She regards the latter as “the sweetheart of the market”.

Daza, who also agrees with other industry experts on the need for the Administration to put more land on the market, also sees “clear potential” for alternative assets (student halls of residence, nursing homes), whose main features are their high profitability and support from demographic factors.

Original story: Eje Prime

Translation: Carmel Drake

Idealista: Rental Prices Rose by 13.2% in Málaga in 2017

11 June 2018 – Diario Sur

Do you live in Málaga for less than €700/month? Then, hold on tight to your home as if it were a treasure. These days, people who are coming to the end of their rental contracts or who are experiencing life changes that are forcing them to find homes in the city – whether it be a move for work, a separation or an emancipation from the family home – are coming up against a harsh reality: the high cost of rent, which has gotten worse to the extent that, today, homes coming onto the market have an average monthly rent of more than €1,000 in half of the neighbourhoods in the provincial capital. That is according to statistics based on the active adverts on the real estate portfolio Idealista, which calculates that rental prices increased by 13.2% over the last year, one of the highest rises recorded in all of Spain’s large cities. Over the last five years, the cumulative increase amounts to 38% and the price per square metre now amounts to €9.80, the highest of all of the Andalucían capitals.

The sharp rise in prices is the consequence of a significant imbalance between supply – which has decreased by 36% in three years, judging by the adverts on Idealista – and demand for rentals, which has increased by more than 120% over the same period. “What is happening in Málaga is what happened previously in Madrid and Barcelona: a genuine shortage of rental housing, especially in the Centre and Teatinos districts, which are the most sought-after areas”, says Carlos Rueda, spokesman for Idealista in the south of Spain, who knows real estate agents in those neighbourhoods who have waiting lists with more than 100 people on them.

Since Málaga has come late to this trend, its prices are now rising rapidly, whilst prices in the country’s two largest capitals are starting to enter a stabilisation phase, according to the Head of Research at Pisos.com, Ferrán Font. “In Barcelona and Madrid, there are areas where prices have stopped rising because price increases cannot be infinite in the rental market”, he added.

But in Málaga, that ceiling has not yet been reached. Inmaculada Vegas, Partner of the real estate agency specialising in rentals Rentacasa, summarises the situation as follows: “The supply has decreased significantly; almost no homes come onto the market. And those that do come on are very expensive. Many owners can’t help themselves: they see that their neighbour has let his home for €800 and so they raise their asking price to €900…the problem is that they find people to pay those prices”, she explains.

The perception of rising prices is even greater in the case of rentals governed by the old Urban Leasing Law, which are being updated now after five years. They are contracts that were signed at the height of the crisis (2013) and now they are being renewed in a radically different scenario. “In those cases, prices may rise by €300 or €400 overnight”, explains Carlos Rueda (…).

For Vegas, much of the blame for what is happening lies with tourist rentals: “Over the last two years, we have seen continuously how long-term rentals are being taken off the long-term rental market to be let by the day or by the week, above all in the Centre, but increasingly in the east of the city as well”, she says.

Rueda does not agree that the influence of holiday rentals has been that great. In his opinion, “since the crisis, Málaga has seen a huge explosion in demand for rental properties, not only from those who cannot afford to buy but also from those who want to live in rental homes” (…).

Original story: Diario Sur (by Nuria Triguero)

Translation: Carmel Drake

Silicius Acquires Offices in Madrid’s Prime Areas & Prepares Purchases Worth €500M

22 May 2018 – Eje Prime

Mazabi’s Socimi is growing its real estate portfolio. Silicius has purchased an office building in Madrid worth €20 million. The asset, located in the prime Salamanca neighbourhood, has a surface area of 2,350 m2 and has just been renovated.

The property was acquired by Mazabi in 2014 and, following the refurbishment, that same family office’s Socimi has won the auction for the building, in which several international funds and a Spanish insurance company participated, according to Idealista.

Similarly, the Spanish manager is working to undertake new investments over the next few months, ahead of its stock market debut, which is scheduled for later this year. The only question remaining is whether it will trade on the MAB or the main stock exchange. The real estate company is currently working on purchase operations amounting to almost €500 million.

Mazabi’s vehicle wants to reach an investment volume of €300 million before it rings the bell (makes its stock market debut) and opens up its share capital to new shareholders. They will boost its development in the Spanish market, where it owns a portfolio worth €120 million comprising commercial premises and offices in Madrid, as well as a hotel in Cádiz.

Original story: Eje Prime 

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

Spain’s Residential Rental Sector Continues to Thrive

6 January 2018 – Cinco Días

The current rental market in Spain has nothing or very little to do with the one that existed in the noughties (2000-2009), when being a tenant was almost equivalent to being a second-class citizen, as Gustavo Rossi, President of Alquiler Seguro, recalls. A study compiled by Idealista maintains that whilst in 2000, homes offered for rent represented just 9% of the market, by the end of 2017, Madrid was the third-placed city in the ranking of places with the most rental homes in Europe, whilst Barcelona was ranked sixth.

That increase in supply has been driven by an exponential growth in demand for rental homes and by the boom in tourist rentals. During the first few years of the crisis, demand switched to the rental market, above all due to necessity. Faced with the impossibility of buying a home due to the high prices or the closure of the credit tap by the banks, or even both factors, families had to resort to renting as their plan B.

Nevertheless, and as the economic and employment recovery has been gaining momentum, although the majority of those who rent still aspire to become homeowners, increasingly more households are opting to lease regardless of their economic capacity or solvency level. They are the new tenants by conviction. “The impact that the no-credit-generation (those who are not willing to get into debt and who prefer to pay to use a home) is having on the market is considerable”, explains Rossi.

One way or another, the percentage of households that rent their homes has gone from just 11% in 2001 to almost double that figure, more than 20% in 2017, according to figures from the sector. That progression is even more marked in the large cities since it is estimated that in Madrid and Barcelona, more than 30% of families rent their homes, which brings Spain closer to the European parameters, where the average number of rental homes exceeds that 30% threshold (…).

Sources at Fotocasa are convinced that this year (2018) there will be a lot of talk about the rental market once again. “The high returns that investors are seeking, the boom in tourist apartments and the change in mentality (towards renting) are going to continue putting upward pressure on rental prices, above all in the large cities”, says the firm’s Head of Research, Beatriz Toribio. In this sense, the table published by the Bank of Spain comparing yields on rental homes with those on the stock market (Ibex 35) and fixed income securities leaves little room for doubt. The latest data reveals a gross profit from rental properties of 4.2% p.a., which soars to 10.9% if we add the gain that can be obtained when a property is sold (capital appreciation) (…).

The experts offer two pieces of advice. Before choosing between traditional rental and tourist lets, investors should analyse all of the variables because it is not always more attractive for a property to be let for very short stays (refer to the comparative graph). And the Administrations are demanding that investors bet more on the rental segment, in the form of direct subsidies and tax reliefs, to encourage owners to put empty homes onto the market and that will allow them to reach maturity. “The rental market is here to stay”, says Eduard Mendiluce, CEO at Anticipa Real Estate.

Original story: Cinco Días (by Raquel Díaz Guijarro)

Translation: Carmel Drake

Idealista: Rental Prices Rose by 18.4% in 2017

4 January 2018 – Eje Prime

The price of rental homes is continuing to rise. The residential rental sector ended 2017 with an average price increase of 18.4%, to reach €9.7/m2/month, according to the latest report from Idealista. The fourth quarter saw a slow down in the rate of growth, given that prices only rose by 3.3%. Barcelona and Cáceres were the only cities where rental prices fell during Q4, by 2.4% and 1%, respectively.

“2017 was undoubtedly the year of the rental market in Spain. Between January and September, the sector grabbed the headlines and was a popular talking point amongst the general public. Prices rose in general across the whole of Spain, although the upward trend was curbed slightly during the final quarter of the year”, according to the research.

It is worth noting that not rental prices did not increase to the same extent in all markets: the Canary and Balearic Islands, together with the Andalucían capitals of Málaga and Sevilla, and the Catalan city of Girona led the price rises. Madrid, which together with Barcelona has traditionally spearheaded the rental market in Spain, saw its prices rise by half the national average. And Barcelona was the only Spanish capital, alongside Cáceres, to end the year with a decrease in rental prices after four years of YoY increases.

In all of the other provincial capitals, rental prices are more expensive today than they were a year ago. Santa Cruz de Tenerife is the capital where rental prices increased by the most in 2017, with a rise of 22.7% to reach €8/m2/month. The increase recorded in Las Palmas de Gran Canaria was also considerable, where rental prices rose by 22.5%, followed by Girona, with an increase of 20.5%.

Original story: Eje Prime

Translation: Carmel Drake

Idealista: Second-Hand House Prices Rose by 2.4% in 2017

27 December 2017 – El País

Despite the Catalan crisis, this year, Barcelona has managed to dislodge San Sebastián from the top of the ranking as the most expensive capital city in Spain.

During 2017, buying a second-hand home has become 2.4% more expensive. Owners have paid an average price of €1,586/m2 in 2017, compared to €1,553/m2 in 2016, according to the latest price index from the real estate portal Idealista.

Nevertheless, not all of the markets have behaved in the same way; some have grown at double-digit rates, whilst others have expanded at more moderate rates, and others have seen price continue to decrease, still not reaching rock bottom.

Thirty of the provincial capital cities have seen price rises, although the most marked increase was recorded in Palma de Mallorca, with a rise of 29.1%, taking the average second-hand house price there to €2,667/m2. It was followed by the city of Málaga, where prices have risen by 16.7% to €1,934/m2. By contrast, Soria is the capital where prices have fallen by the most (-8.3%), followed by Ávila (-6.9%) and Almería (-5.1%).

Despite the Catalan crisis, which “will affect the final result for the year”, according to Fernando Encinar, Head of Research at Idealista, this year, Barcelona has managed to dislodge San Sebastián from the top of the ranking as the most expensive Spanish capital, at €4,284/m2, compared to €4,052/m2 in the Guipuzcoan capital. Those two cities are followed by Madrid (€3,285/m2) and Bilbao (€2,871/m2).

By autonomous region, the largest increase was recorded in the Balearic Islands, where owners are now asking 25.3% more for their homes than they were a year ago. It is followed by increases in Cataluña (9.5%), the Canary Islands (8.4%), the Community of Madrid (7.1%), Aragón (2.3%), the Community of Valencia (1.9%), Andalucía (0.8%) and País Vasco (+0.5%). At the other end of the spectrum, the largest decreases were recorded in Navarra (-4.8%), Asturias (-3.2%) and Castilla La Mancha (-2.4%).

The Community of Madrid is the most expensive autonomous region, at €2,544/m2, followed by País Vasco (€2,519/m2), the Balearic Islands (€2,472/m2) and Cataluña (€2,082/m2), whilst the regions with the most affordable prices are Castilla-La Mancha (€897/m2), Extremadura (€932/m2) and Murcia (€1,019/m2). The provinces with the most expensive homes are Guipúzcoa and Vizcaya, at €2,760/m2 and €2,591/m2, respectively. They are followed by Madrid (€2,544) and Barcelona (€2,544/m2). Toledo is the most affordable province (€770/m2), followed by Avila (€801/m2) and Ciudad Real (€840/m2).

Original story: El País (by S. L. L.)

Translation: Carmel Drake