Ministry Of Development: House Prices Rise For First Time Since 2008

27 February 2015 – El Correo

House prices rose by 0.5% in the last quarter of 2014; and the average price per square metre amounted to €1,463.1.

Average house prices increased by 0.5% in the last quarter of 2014, the first quarterly increase since the beginning of 2008, the year in which the crisis began. Meanwhile, the average price per square metre amounted to €1,463.10, according to reports from the Ministry of Development.

Despite the quarterly increase, house prices closed the year (2014) with an inter-annual decrease of 0.3%; although this percentage was negative, it was more moderate than the -4.2% recorded in 2013.

In this way, house prices recorded seven consecutive years of decline, during which time the cumulative decrease from the peak prices recorded in 2008 amounts to 30.4%. In real terms, after accounting for the variation in CPI, this decrease rises to 36.9%.

Also, despite the slight quarterly increase, the average price per square metre was still at similar levels to those recorded at the beginning of 2014.

By type of property, both new builds and second-hand homes ended 2014 with price increases. Homes that were less than two years old became 1.2% more expensive, to reach €1,517 per square metre, and second-hand homes rose by 0.2% to €1,441 per square metre.

In the subsidised housing segment (vivienda protegida or VPO), the price per square metre amounted to €1,099.90 in the fourth quarter of 2014, representing a year-on-year decrease of 0.3% and an inter-quarter increase of 0.2%.

In this way, the general price index registered a rise of 0.3% between October and December last year, with respect to the previous three months and a year-on-year decrease of 0.3%. With this year-on-year decline, the general price index has now recorded 25 cumulative quarters of negative growth.

Prices decreased the most in Asturias and Navarra

By autonomous region, five regions experienced year-on-year increases in the price of (unsubsidised) homes: Cantabria (+3.6%), the Balearic Islands (+2.4%), the Canary Islands (+1%), Valencia (+0.6%) and Madrid (+0.5%).

By contrast, the largest year-on-year decreases were recorded in Asturias (-5.2%), Navarra (-4.2%), Castilla y León (-3.7%), Castilla-La Mancha (-3.1%) and Galicia (-2.8%).

In terms of towns with more than 25,000 inhabitants, the highest prices per square metre were found in San Sebastián (€3,117/m2), Getxo (€2,696.40/m2), Calvià (€2,526/m2), Alcobendas (€2,477.2/m2), Pozuelo de Alarcón (€2,471.6/m2), Barcelona (€2,416.3/m2) and Majadahonda (€2,399.7/m2).

The lowest prices in towns with more than 25,000 inhabitants were recorded in Elda (€557.3/m2), Crevillent (€597.3/m2), Tomelloso (€600.8/m2), Jumilla (€605.2/m2), Ontinyent (€606.7/m2), Villarrobledo (€609.6/m2) and Hellín (€618.5/m2).

Original story: El Correo

Translation: Carmel Drake

Housing Permits Rose Slightly In 2014 After 7 Years In Decline

27 February 2015 – Expansión

The Colleges of Technical Architects granted 34,873 permits for the construction of homes in 2014, a very small increase, of 0.003%, but still an increase and the first sign of growth after seven years of decreases, according to the most recent information published by the Ministry of Development.

Despite this increase, (the number of) housing permits remains well below the peaks recorded in 2006, during the height of the real estate sector boom, when they exceeded 865,000 in one full year. Since then, the cumulative decrease amounts to 96%.

The number of housing permits started to fall in 2007, by 24.8%, and since then have continued on a downwards trend to reach their lowest levels at the end of last year.

Since 1991, when the Ministry of Development first started to compile this data, the number of permits reached their historic monthly low in August last year, when there were only 1,585 granted. The historical (monthly) peak was recorded in September 2006, with 126,753 permits granted.

In total, the number of permits granted for new builds, renovations and extensions amounted to 58,776 (last year), which represented an increase of 0.06%, with respect to 2013.

By type of property, permits to construct housing blocks increased by 1.6%, with 23,301 licences, whilst permits to construct family homes rose by 1.4%, to 23,301.

In terms of size (surface area), the average size of family homes was 198 square metres and the average size of apartments was 112 square metres.

Original story: Expansión

Translation: Carmel Drake

BBVA And The Government Reactivate The Castellana Extension

2 February 2015 – Expansión

BBVA and San José will invest €4,800 million in the Castellana Extension / Covering an area of more than 3 million sqm in the North of Madrid, it will be the largest real estate development project in Spain. An IPO has not been ruled out.

Investment of almost €6,000 million, an area of more than 3.11 million sqm, 20 years of planning and another 20 years of development – those are some of the dizzying figures encompassed by the Castellana Norte urban development project in Madrid, also known as Operation Chamartín or the Castellana Extension.

“It is a very unique, innovative project that will result in the strengthening of the local, regional and national economy. It is the only project of its kind anywhere in the world”, said Francisco Gonzalez, the Chairman of BBVA, on Friday as he presented the plans for the regeneration of the north of Madrid, which has been paralysed for years and which will be the largest real estate development project undertaken in Spain in the last two decades.

The financial institution is the owner of 75.5% of the company Castellana Norte Madrid, the developer behind the plan. The remaining shares are held by the San José Group, whose own shares soared by 8.5% in trading on Friday.

Homes and offices

The project includes the extension of the capital’s main thoroughfare, the Paseo de la Castellana, by 3.7 km and the movement underground of the railway tracks at Chamartín station. 17,000 homes will be built on this land, of which 10% will be subsidised in some way; a financial district covering almost one million square metres will also be constructed.

The company Castellana Norte will drive the regeneration of this area, alongside Chamartín station and its adjoining railway tracks. Thus, of the total investment (€5,974 million), the company will spend €1,300 million on infrastructure and another €3,500 million on the construction of buildings. A long way off of the €11,000 million projected in the initial plans devised for the area in 2008. “The previous project was based on estimated revenues and therefore associated investment when housing was worth 40% more (than it is now)” explained Antonio Béjar, the Chairman of Castellana Norte. “The current plan addresses the shortcomings of the past and will involve a significant degree of self-financing”, he added. Sources of funding may include the entry of a new partner into the company, the use of bank financing and even the IPO of the company.

Construction of this neighbourhood, designed in four areas, will take place over 20 years and will result in the creation of 120,000 new jobs. “The project will generate economic gains of more than €3,363 million for the public administrations”, confirmed the Town Hall of Madrid on Friday.

The developers hope that the various government bodies involved in the process (the Ministry of Development, the Community of Madrid and the Town Hall of Madrid) will formally approve the project during the next few months so that work can begin on the development “at the end of this year or at the beginning of next year”.

Sustainable travel will play an important role in the new urban development, which will include three new metro stations, two train stations and 12.8km of cycle lanes. 80% of the 3.114 million square metres of land (just under the permitted buildable area) will be used for public infrastructure projects, including space for green areas equivalent to 56 football pitches.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake