Tag: neighbourhoods

Tinsa: House Prices Rose By 0.8% In Q4 2016

4 January 2017 – El Mundo

Average house prices in Spain rose by 0.8% during the fourth quarter of the year with respect to the same period in 2015, according to provisional data published in Tinsa’s IMIE Local Market Index. According to the appraisal company, the stabilisation in prices, which is in line with the YoY variation recorded during the third quarter of the year, “reflects micro-market multiples, which are evolving at different speeds”.

The index highlights that Cataluña, which saw an increase of 7.2%, the Community of Madrid (5.2%) and País Vasco (4.3%) continue to be the drivers of the housing market in Spain, followed by the Canary Islands and Andalucía, which saw price rises of 2.8% and 2%, respectively, in terms of YoY variation during Q4.

At the other end of the spectrum, the highest price decreases were recorded in the regions of Murcia (-4.8%), Castilla y León (-3.9%) and the Balearic Islands (-3.1%). Price decreases were also observed in Cantabria (-2.1%), Navarra (-1.9%), Asturias (-1.3%) and Aragón (-0.9%), which closed the year with lower prices than in Q4 2015.

According to Tinsa’s report, homes are now at least 5% more expensive than they were a year ago in up to six provinces. Barcelona (8.4%), Palencia (7.8%) and Guipúzcoa (7.4%) saw the highest price rises over the last year, followed by Málaga (with growth of 6.6%), Madrid and Almería (both of which recorded YoY rises of 5.2%).

By contrast, the provinces of Huelva and Lérida registered decreases of -6.9% and -6.5% over the last year, respectively. The provinces of Orense, León, Murcia and Valladolid are saw prices decreases of more than 4%.

Cities

By provincial capital, house prices rose significantly over the last year in San Sebastián (12.1%), Bilbao (11.6%) and Barcelona (11%), well above the increases recorded in Madrid, Málaga and Palencia, where average prices rose by 6.3%, 5.4% and 5% YoY, respectively.

This evolution contrasts with that recorded by the group of 29 capitals where average prices are lower than they were a year ago, led by León (-11.1%), Murcia (-7.3%), Valladolid (-6.6%) and Lugo (-6.2%).

Tinsa’s detailed analysis of the residential market in Spain’s five largest provincial capitals reveals significant price increases in certain districts of Barcelona, Madrid and Valencia. That was the case in the neighbourhoods of Gràcia and Eixample in Barcelona, where the average price of finished homes rose by 16.5% and 15.1% YoY, respectively.

In Madrid, the highest price rises were concentrated in the areas of Hortaleza (13.4%), Centro (11.9%) and Tetuán (11.4%). (…).

The Barcelona district of Sarriá-Sant Gervasi continued to be the most expensive neighbourhood of the five large capitals analysed, at €3,901/m2, followed by Les Corts (€3,716/m2). In the capital, the neighbourhood of Salamanca, with an average price of €3,645/m2 exceeded prices in Chamberí (€3,562/m2), which saw the highest price rises in the city last quarter.

Rate of sales

According to Tinsa, average sales periods (…) have decreased below 10 months for the first time since this indicator was first compiled in Q2 2015, to 9.9 months across Spain. (…).

Original story: El Mundo

Translation: Carmel Drake

Al Breck’s Socimi Debuts On The MAB With 300 Rental Homes

30 November 2016 – Cuatro.com

The Socimi RREF II Al Breck will debut on the MAB today (Wednesday 30 November) at a price of €5.40 per share.

The fund Al Breck will debut its new Socimi on the Alternative Investment Market (MAB) today, Wednesday 30 November. The Socimi was constituted with a stock of around 300 rental homes, located in the centre of Madrid. The fund acquired the properties from the Spanish fund Segurfondo Investion in December 2014.

The firm, known as RREF II Al Breck Socimi, will debut on the stock market at a price of €5.40 per share, which represents a company valuation of €28.8 million, according to the BME.

Specifically, the new Socimi owns a stock of 293 homes located in the centre of Madrid (in the following neighbourhoods: Centro, Salamanca, Chamberí and Chueca), as well as in La Moraleja (Alcobendas) and in towns close to Alcobendas and Torrejón de Ardoz. It also owns twelve retail premises and one office.

According to the prospectus for the IPO, the market value of this portfolio of assets, calculated by an independent firm, amounts to €110.52 million.

On the other side, the company’s debt amounts to €70.03 million, and comprises a participative loan granted by the parent fund, i.e. a liability equivalent to 63% of the value of the portfolio. In addition, all of the homes are mortgaged in favour of Banco de Sabadell, the entity that financed their acquisition.

The Socimi will debut on the stock market with a business plan that involves generating value from its portfolio, in other words, forecasts selling all of the homes within a five-year period, which will end in December 2020.

Aggressive strategy

Specifically, the plan involves investing in improvements in the homes “to increase returns and improve occupancy rates to stable levels, implementing an aggressive rental strategy that includes, where necessary, lowering rents and making concessions to tenants to improve their cash flows”.

Subsequently, “once the occupancy rates have increased, we will ensure they remain stable and start to progressively increase rental income, in accordance with the improvements made at the properties and market prices”.

Finally, the Socimi expects “to optimise the value of the portfolio by selling the assets either individually or in batches, when demand and price make such a decision worthwhile and only after the minimum holding period of three years (applicable to all Socimis) has been exceeded”, according to the prospectus.

Original story: Cuatro.com

Translation: Carmel Drake

Tinsa: House Prices Rise By Most In Madrid & Barcelona

18 July 2016 – Expansión

The Balearic and Canary Islands are featuring in the housing recovery, but Madrid and Barcelona are leading the way; there, the number of transactions has picked up pace and prices are growing strongly once again. Most of these increases are due to the economic recovery, but the savings factor is also playing a major part.

In fact, the influence of private investors is still playing a crucial role in the strengthening of the two major real estate regions, whose central districts are the most sought-after by companies and individuals, both Spanish and foreign.

It is precisely the influence of these investors that boosted property prices in both capitals in the first place, firing the starting gun for the reactivation of the sector, as they committed to the prime areas before anyone else. These central districts, which are well-connected and offer good services, used to offer a certain degree of security for investors, and a great deal of potential for appreciation, even when everyone in the market was still searching for land.

Both cities were amongst the leaders of the increase in house prices during the second quarter of the year, according to data from the appraisal company Tinsa, published recently. Nevertheless, these increases were concentrated in some of the most expensive areas, as shown by the analysis by district of the local markets. Specifically, many of the neighbourhoods where prices stand at around €3,000/sqm in Madrid and Barcelona are also those where prices have risen by the most in the last year, whereas prices in those neighbourhoods that fall below the average have grown more moderately.

For example, prices in the Madrilenian neighbourhood of Salamanca have risen by 9.8% in the last year, whilst in Chamberí they have increased by 8.9%. Meanwhile, in Barcelona, the following districts stand out: Gràcia (where prices have risen by 12.7%), El Eixample (10.9%) and Les Corts (8.1%). These statistics show that the prime areas are recovering better than the rest. They are central, well-connected areas with very solvent demand, where returns are high and there is significant retail activity, which means they have significant potential for appreciation both for those buying to invest as well as those looking to put their properties up for rent. As with everything, there are notable exceptions, such as the Retiro area in Madrid and Sarrià-Sant Gervasi in Barcelona, which are increasing by below the average.

Other areas

Nevertheless, the real estate expert José Luis Ruiz Bartolomé indicates that the real estate market has now entered a new phase, in which the recovery is spreading to more and more areas. “Before, properties were only being sold in the best districts, but now the increases have spread to the most popular areas, as supply is limited and there are increasingly more buyers looking for homes to live in, rather than to buy as investments”, he explains.

For this reason, the most popular neighbourhoods have become more attractive with the recovery of the labour market and the opening of the bank financing tap. In this way, house prices in the Madrilenian neighbourhood of San Blas have risen by 9.9%, making it the second highest price rise district in the capital; meanwhile, Sant Andreu is also boosting prices in Cataluña, with an increase of 8.2%. Similarly, prices in all of the districts of Madrid that cost less than €2,000/sqm have increased by more than the average, with the exception of Villaverde, the cheapest of all, where prices have remained stable. Something similar is happening in Barcelona where the most popular areas, such as Nou Barris and Sants-Montjuïc, also grew by more than average. (…).

Moreover, Tasaciones CBRE indicates that the profile of investments funds “has evolved rapidly from being opportunistic to value-added, choosing instead to back development, the renovation of properties and, given that they have perceived the potential for refurbishments, they will gradually start managing plots of land in urban areas, with the aim of obtaining higher returns”. With this, the increase in demand and prices will increasingly move to more remote areas. (…).

Original story: Expansión (by Pablo Cerezal)

Translation: Carmel Drake

The Socimi Hadley Will Debut On MAB ON 15 June

14 June 2016 – Expansión

The Socimi Hadley Investment will debut on the Alternative Investment Market (MAB) on Wednesday 15 June 2016, at a price of €6.15/share, which represents a market capitalisation of €30.75 million.

Hadley, the seventeenth Socimi to debut on the MAB, owns three retail premises, one in Palma de Mallorca, another in Pamplona and a third with a warehouse in Tenerife. It also holds “surface rights” (derechos de superficie) over homes in the neighbourhoods of Vallecas and Ventilla de Madrid.

In the case of the latter, the company leases the homes, which it acquired under a surface rights agreement, to Madrid’s Housing Institute (Ivima), and has recognised a receivable for the present value of the minimum payments to be received from the tenant, discounted at the project’s implicit interest rate. These surface rights are valid until 2022 and 2023, respectively.

Hadley’s sole shareholder is Stirling Adjacent Investments, a firm owned by the company TAO Finance 3, which, in turn, is held by private investment funds. The management of the Socimi’s asset portfolio is performed by Servihabitat.

The real estate firm will debut on the MAB under the ticker symbol YHLY and its shares will be traded under the fixing price system.

Original story: Expansión

Translation: Carmel Drake

Colau Proposes Veto Of New Hotel Openings In Barcelona

24 February 2016 – Expansión

The Town Hall of Barcelona will not grant any more licences to permit homes to be used for tourism purposes in the Catalan capital and will only allow new hotels to be opened in the suburbs. At least that is according to the plan that the municipal government, led by Ada Colau (pictured above), which holds a minority, presented yesterday and which it is planning to adopt albeit preliminarily on 10 March. A period of public consultation and citizen participation will open on that date.

In order to achieve a “natural decline” in (the number of) hotels, hostels and B&Bs in the most central neighbourhoods, Colau is suggesting that, when businesses close, they should not be reopened again. This limitation will affect the districts of Ciutat Vella, Eixample, Gràcia, Poble Sec , the area surrounding Park Güell and Hospital de Sant Pau, as well as Vila Olímpica. In other words, neighbourhoods that are home to more than half of the city’s supply of tourist accommodation.

By contrast, licences will be granted in a second group of neighbourhoods, such as in Sants, Sant Gervasi, Sant Martí, the south of the Sant Andreu district and El Clot. And new hotels may be opened in the neighbourhoods to the North of the city, as well as in those that are undergoing urban development, namely: la Sagrera, 22@ and La Marina de la Zona Franca.

Moreover, new hotels may not be opened in buildings destined for residential use or in streets that are less than eight metres wide.

This proposal, which comes after an annual moratorium that has prohibited the construction of hotels, will be debated tomorrow by industry players, who yesterday rejected the intentions of Ada Colau and her team. The Hoteliers’ Guild asked that continuity be given to projects that have already been approved and affected by the moratorium, and it defended that “hotel growth” be allowed in the city by consensus.

Meanwhile, the Association of Tourist Apartments in Barcelona (la ‘Asociación de Apartamentos Turísticos de Barcelona’ or Apartur) said that “the worst way to fight against the illegal supply (of tourist accommodation) is to freeze licences” and it urged Colau to change her plans.

Original story: Expansión (by David Casals)

Translation: Carmel Drake

House Prices Rise By 9% In Madrid In 1 Year

13 October 2015 – Expansión

Average house prices in Madrid amount to €2,937/m2, which represents an increase of 8.9% compared with a year before, according to a report published last week by the real estate consultancy Aguirre Newman. Despite this increase, house prices in the capital are still 37% lower than their peak in 2007 (€4,657/m2), the year the crisis started and the real estate bubble burst. The consultancy says that the current increases in house prices is being driven by growth in prime areas, given that prices have remained stable in all other areas.

The most expensive neighbourhoods for buying a house in the capital are: Almagro (Chamberí), El Viso (Chamartín), La Piovera (Hortaleza), Goya and Castellana (Salamanca) and Justicia (Centro), where property developments are currently being sold for prices of between €6,500/m2 and €7,000/m2. At the other end of the scale, the cheapest homes in Madrid are found in the districts of Villaverde, Villa de Vallecas and Carabanchel, with prices of between €1,600/m2 and €1,800/m2.

In terms of the municipalities closest to the capital, average house prices are highest in Pozuelo de Alarcón and Majadahonda, reaching up to €3,944/m2. The most economical municipalities are Móstoles and Pinto.

Average prices in Spain

By contrast, Tinsa published another study at the end of last week, which revealed that the price of (unsubsidised) homes decreased by 0.4% in September with respect to the same month last year, which confirms “the stabilising trend in terms of prices”, according to the Local Markets Index. The appraisal company indicated that this is the slowest rate of decrease since March 2008 (-0.3%), which marked the first YoY price fall in the series, which was launched in 2001. Average house prices in Spain have recorded a cumulative decrease of 41.9% since their height. By region, prices in the Balearic Islands and Canary Islands performed the best in September.

Original story: Expansión

Translation: Carmel Drake

RR de Acuña: Spain’s Housing Market Recovery Will Be Asymmetrical

17 September 2015 – Expansión

Real estate trends / RR de Acuña’s “Real Estate Yearbook” confirms the “stabilisation” of the upward trend in the market.

The recovery in the housing market is going to be long and asymmetrical. On the one hand, progress will be mild but steady in large cities and consolidated areas on the coast. On the other hand, provinces with a lot of stock are in for a long, idling journey. Finally, in the prime areas – districts in the centre of the regional capitals, exclusive urbanisations and luxury developments – growth will be much more marked. What does the photo look like on aggregate? The sector will continue to stabilise, without bubbles or depressions.

Those are the main findings to be drawn from the Spanish Real Estate Market’s Statistical Yearbook for 2015, prepared by RR de Acuña y Asociados. The forecasts made by the real estate consultancy firm are promising, but prudent.

After seven consecutive years of declining house purchases, 2014 marked “a turning point in the property cycle” and 2015 and 2016 are expected to close with figures that are clearly positive. Firstly, the trend in house prices is expected to normalise. In other words, the cost of buying will increase but “not excessively”, said Fernando Rodríguez de Acuña, Project Director at the company, yesterday, during the presentation of the report.

It is true that house prices will increase “significantly” in the most consolidated areas and in those regions that have smaller stocks of unsold property. In these areas – above all, Madrid, Barcelona, Valencia, Málaga and Alicante – homes will become between 3% and 5% more expensive during 2015 and 2016.

But, residential property prices will increase by even more in certain very important – the real estate sector is a market that must be divided into submarkets – . “In prime areas, prices will rise by more than 5%”, said Rodríguez de Acuña. In other words, “in the best neighbourhoods of the central districts of Madrid and Barcelona, and in the VIP areas of Marbella and Palma de Mallorca, amongst other areas”.

More sales of second hand homes

Moreover, sales will increase in Spain by more than 10.5% in 2016, and 2015 is expected to close with fewer transactions involving new homes and less self-promotion, but with a net recovery of 9.6% in the market for second hand properties. (…).

Other data also points to a considerable amount of realistic optimism. Mortgage lending will soar “clearly” by more than 20%, assures Rodríguez de Acuña, on the basis of another report from his firm that has not yet been published. (…).

Unsellable homes

The stock of unsold homes will decrease by 117,000 over the next two years. But here, two important observations are required: firstly, mortgage financing still barely accounts for one fifth of its previous levels and the total stock of homes still exceeds 1.5 million units. (…).

Construction

The Real Estate Yearbook for 2015, which is dedicated to its creator, Fernando Rodríguez y Rodríguez de Acuña, who died recently, devotes an entire section to one indicator, which is key to defining the different speeds of the recovery: the time required to sell all of the stock (‘el tiempo de disolución del stock’ or the TDS). In other words, the number of years it will take for demand to absorb the excess supply of homes for sale. Only Madrid and Navarra have a TDS of less than 3.5 years.

Meanwhile, Barcelona, Sevilla, Alicante, Málaga, Granada, Huelva, Vizcaya and Guipúzcoa all have TDSs that range between 3.5 and 5.5 years. At the negative end of the spectrum, some provinces have TDSs that exceed 10 years. Their stock is almost unsellable. In any case, the surplus is gradually decreasing, in general terms, and the cranes are returning, albeit very slowly. (…).

In summary, “the forecast restoration of the balance and subsequent growth in the real estate sector” will be two “slow” processes and there will be “different speeds in the recovery of the real estate sector, which will vary by geographical area”.

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

Strong Recovery In Madrid’s Market For New Homes

14 July 2015 – Cinco Días

The lack of new housing developments in Madrid in recent years means that the few blocks that have been built are being sold quickly, as the economic environment improves. So much so that the marketing company Foro Consultores has conducted the first comprehensive study of the new build segment, which not only estimates the size of the stock of new homes in the capital, it also calculates when that stock may be depleted if the current strong rate of sales continues.

The study, based on visits to all of the developments currently for sale and simulations of purchases or direct surveys at the sites, has focused on analysing the existing supply in new urban developments (Arroyo del Fresno, Montecarmelo, Las Tablas, Sanchinarro, Valdebebas, El Cañaveral, El Ensanche de Vallecas and Carabanchel), since those are the areas where the new builds are concentrated. Whole new buildings are the exception rather than the rule in the city centre and in the city’s more established neighbourhoods.

Foro Consultores begins its report by highlighting the number of new homes: currently the stock of new homes available for sale in Madrid amounts to 1,770, of which 781 are “free” and 989 are social housing (VPO) homes. That figure represents just 20% of the total number of buildings that have started to be built since 2010. Moreover, we are talking about very small numbers if we take into account that the study has analysed 102 developments in total, containing 4,001 “free” homes and 3,861 social housing homes, almost 8,000 homes, which came onto the market in recent years as turnkey properties or homes sold off-plan.

4.1 homes sold per development per month

The uptake of homes by region is not uniform. More than half of the new homes built in El Cañaveral, in the south of the city – the last development to get underway – have not yet been sold. Meanwhile, in other new neighbourhoods, such as Montecarmelo, less than 5% of the new homes or those under construction remain unsold. Furthermore, in Ensanche de Vallecas in 2007, there were almost 3,000 unsubsidised new homes for sale, but now there are just 166 left.

As well as the scarcity of supply due to the construction paralysis in recent years, one of the keys that explains the fast absorption of the stock is the acceleration in the rate of sales in recent months. Foro Consultores estimates that if no new developments come onto the market, then the excess would be depleted in just six months, at the current sales rate of 4.1 homes per development per month.

The study highlights that these 4.1 homes sold (per development per month) represents the sale of 5.3% of developments every 30 days, an average rhythm that has not been seen since 2003, and for unsubsidised housing, that figure is almost 5 homes per development per month, whereas during the crisis, it never exceeded one unit per month.

The study also shows that 79% of the developments on the market were started between 2010 and 2015, and of those 77% have already been sold.

In terms of prices, the report also highlights that in certain developments in El Cañaveral, the price of unsubsidised homes is lower than the price of VPO homes, which is not very typical in Madrid. “This shows that the social housing pricing model is out of synch with the market and that the promoters of unsubsidised homes have adapted better to the changes in conditions”, explained Foro Consultores.

In the areas analysed, the absolute prices of unsubsidised homes ranges between €77,000 and €657,000, with an average price of €273,021. Meanwhile, the prices of VPO homes range between €38,474 and €382,652, with an average price of €150,721.

Finally, the study concludes that by type of home, three-bedroom houses are in most demand. Meanwhile, the construction of studios and small flats, which were so fashionable during the boom, is now reducing.

Original story: Cinco Días (by Raquel Díaz Guijarro)

Translation: Carmel Drake