In One Month, Valencia Receives Applications for Two Hotels and One Apartment Block in the City Centre

29 March 2018

Tello is requesting that the Exarchs palaces be granted protected status, whose planned rehabilitation includes a hotel.

The Valencia City Council received two requests to open new hotels in one month, as well as two apartment block developments, at least one of which is in Ciutat Vella, Valencia’s historic centre. The requests are currently open to public discussion.

One of the apartment developments is located on three lots of land in the Velluters neighbourhood, at 27, 29 and 31 Bany Street. It is an area where other similar ventures have already opened, in a run-down area of the city centre which has seen a loss of residents in recent years.

The second proposal concerns a new four-star hotel-apartment in an existing building at 28 Corretgeria and 4 Bany Pavesos. The building is a few meters from the Micalet and was used as the headquarters of a hospitality school for years.

Another hotel at 18 Ruzafa, very close to the intersection of Santa Clara Convent Street, is also open for public discussion. In this case, the hotel’s category has not yet been specified. The fourth development is another apartment block, although its location is also as yet unspecified.

The pace of the new developments is an indicator of the sector’s strength in the city. Another hotel is to be built in the Exarch’s palaces, located in Santos Juanes and La Lonja. Yesterday, the City Council announced, through the Councillor for Culture, Glòria Tello, that it intends to request that the Ministry of Culture declare the properties as being of Cultural Interest.

Dating from the fourteenth century, the mansions are part of an urban-planning project, which also impacts some sites where archaeological excavations are being carried out. The application to build a hotel on the premises led to demands by residents and institutions such as the Consell Valencià de Cultura to request that the palaces gain protected status, along with elements such as the kitchens and chapel of San Ignacio de Loyola.

While the request for the conservation of the sites is under consideration, the Department of Urban Development will formally declare the palaces of the Exarchs as a Locally Relevant Property (BRL), a transitional regime in any construction that goes beyond conservation efforts will have to receive prior approval from the Generalitat.

Original Story: Las Provinces – P. Moreno / I. Sunday

Translation: Richard Turner


Metrovacesa Reaches Low with €39 Million in Losses and Begins Recovery

23 March 2018

In 2018, the real estate company plans to launch between 3,500 and 4,000 units, while delivering 520.

Metrovacesa, a real estate developer controlled by Santander and BBVA, announced today that it recorded losses of 39 million euros in 2017 with revenues of 28 million euros and a gross margin of 25%, in line with its reporting during its re-listing on the stock exchange.

The company, which returned to the stock exchange on February 6, obtained a negative gross operating result (Ebitda) of 7 million euros in its launch phase.

However, Metrovacesa has highlighted the group’s “solid” financial position, with zero net debt and a long-term loan to value target of less than 25%, which will allow the implementation of its business plan.

The company has highlighted that it is “firmly” moving forward with its plans to meet target deliveries of between 4,500 and 5,000 homes by 2021.

In 2017, the sales of residential units experienced “solid” growth, especially in the second semester.

The company pre-sold 512 homes in the year as a whole, closing the period with an accumulated pre-sale book of 135 million euros (equivalent to 541 units). The number of deliveries made during 2017 reached 110.

As of December 31, 2017, the company had 48 active developments (2,141 residential units), of which 21 (955 residential units) are already under construction.

Regarding its service industry business, Metrovacesa obtained 2.6 million euros last year from the sale of land and has preliminary agreements for another 30 million euros.

The firm has also highlighted the sale of a turnkey project involving an office in Madrid located in Josefa Valcárcel for 30 million euros to Axiare Patrimonio.

By 2018, Metrovacesa expects the launch of between 3,500 and 4,000 units and the delivery of 520. Regarding the progress of sales, the developer’s projects have a high level of visibility for deliveries this year, with 70% already sold.

In addition, all units that have been targeted for delivery are in the construction phase.

In 2019, the company plans to deliver 700 units, 33% of which have already been sold and 72% are in the construction phase.

Metrovacesa practices active management of the land undergoing development, which has meant that, in the last quarter of 2017, the company managed to increase its ready-to-build land portfolio by 76%, in terms of gross asset value (GAV).

With regard to the service industry business, Metrovacesa aims to launch more than 36,000 square meters in the current year.

Original Story: La Información

Photo: Wikimedia Commons

Translation: Richard Turner

Inbisa Inmobiliaria Will Build 1,100 Homes this Year, Generating Sales of €450 Million by 2020

26 March 2018

The Basque group is proposing to hand over the keys to about 400 homes in developments in Sanchinarro, Madrid and Sant Cugat, in Barcelona, in 2018.

Inbisa Inmobiliaria is building its future. The company has committed itself to the Spanish real estate market, setting ambitious short-term objectives. The first will be to deliver 400 homes in 2018 and begin construction on 1,100 more, Manuel Balcells, the group’s general director, explained to EjePrime. These projects will bring Inbisa closer to its goal of 450 million euros in sales by 2020.

“For the year 2018, Inbisa Inmobiliaria has set the goal of maintaining our current pace of activity, targeting moderate growth without artificial objectives,” said Mr Balcells, who started at the company as director of Inbisa Real Estate in Catalonia in 2001.

The group’s real estate division intends to deliver the keys to nearly 400 homes. These homes are located in the Inbisa Sanchinarro Residential developments in Madrid (169 units), Phase I of the INBISA Residential Parc Central – San Cugat in Barcelona (105 units) and Phase I of the Residencial Etxebarri Berria in Bizkaia (105).

“The successful execution of these deliveries will be a step up for the company in terms of sales, with an increase in sales of 156 units compared to 2017,” the executive stated. Inbisa Inmobiliaria plans to start construction on more than 1,100 homes throughout the country in 2018, mainly in Madrid, Barcelona, the Basque Country, Cantabria, Burgos and Malaga.

The data undergird the group’s development plans for 2017-2020, which aims to increase the company’s turnover in its residential arm to more than 350 million euros in this period alone. Additionally, the company expects to acquire new land in the coming months and launch new residential developments to for an added turnover of 100 million euros, reaching their target of 450 million euros.

Industrial business

On the other hand, the company is also looking to increase its revenues in the industrial area, although the firm has not detailed the level of growth it is targeting. “It’s a sector that is currently growing, especially in Madrid and Barcelona,” Mr Balcells said. “We are mainly interested in the logistics sector, where we had been one of the principal players in recent years and where we want to be active again,” the executive stated.

With regard to land acquisitions, Inbisa Inmobiliaria’s strategy will continue to be one of undertaking developments in those Spanish localities where the group sees that there is real demand, in every case, adapting to the buyers’ needs. “There are no circumstances in which we intend to hold on to a portfolio of idle land. That is not a part of our current strategy because we put the land to use as soon as we have the necessary permits,” the Basque firm stated.

“We believe that 2018 will see a consolidation of the real estate market’s recovery, principally in the residential sector. Madrid and Barcelona have been the focus of the return to growth, but little by little we are seeing other locations gaining dynamism,” the executive concluded.

Original Story: EjePrime – C. Pareja

Translation: Richard Turner

Kutxabank Sells 18,000-Square-Meter Plot of Land in Madrid to Top Gestión Madrid

23 March 2018 – EjePrime

The company will build a development with 154 publicly protected homes on the land, located in Alcalá de Henares.

The Basque Kutxabank is selling its real estate holdings. The bank sold the 18,173-square-meter site to Top Gestión Madrid, which has already announced that it will build a development with 154 publicly protected homes (Vppl – subsidised housing) on the land, located in Alcalá de Henares.

The plot, located in ​​Espartales Norte, belonged to the Basque savings bank Kutxa, which incorporated the land into Kutxabank when the three main Basque financial institutions merged in 2012.

The apartment blocks that were designed for the development have seven floors each with penthouses and will be built following the principles of sustainable architecture. The venture is a response to the currently elevated demand for residential assets in the Henares Corridor.

For Top Gestión Madrid, a newly created company, the operation involves “continued growth, while reinforcing the geographical diversification of our portfolio of land,” its general-director, María Emilia Alarcón stated. The company’s portfolio consists of fifteen ventures in various stages of development, including completed projects, works in progress and those about to go on sale, in Madrid and Andalusia.

Original Story: EjePrime

Translation: Richard Turner

The Owners of La Zagaleta Will Create a Luxury Development for Millennials

28 April 2017

The British firm, which owns the most luxurious resort in Europe, is working on a development in Cádiz, with homes which will cost between three and five million euros, aimed at the younger generations of extremely wealthy families.

Located in the municipality of Castellar in Cádiz, next to the exclusive developments of Sotogrande and Valderrama, the last available estate in the area is awaiting the approval of the local town council to become the site of a modern and luxurious residential resort, which will include a top-level golf course and a five-star hotel. The estate is called Valderrama II, a 220-hectare farm that was acquired last year by the company La Zagaleta Limited.

The firm, based in London and owner of another luxurious residential development called La Zagaleta, bought the Valderrama group, the company that owns the land, as well as the golf course of the same name, considered the best in Spain and one of the best in the world, in a deal valued at 40 million. “The agreement was closed in December 2015. There are a number of possibilities but we intend to convert Zagaleta Limited into a holding that integrates several luxury brands, and that is why we choose only projects that have established brands that are well-known in the real estate market. Here we have a unique opportunity to develop the land from scratch. The land has a total of 220 hectares, where we can build 200 homes, a golf course and a hotel,” Ignacio Pérez, Business Development Director of La Zagaleta, explained.

The owners of La Zagaleta’s new project, considered the most luxurious development in Europe, and located in the Malaga municipality of Benahavís, will also be for millionaires, but with some differences. “In La Zagaleta there are two lines: one with houses of between five and eight million euros and another one starting with eleven, which is the one we are promoting.” Valderrama 2 is another concept, with houses of between three and five million euros, that the buyer can easily finance,” Ignacio Pérez stated.

Also, the new venture will have a maximum of 200 homes, each with between 2,000 and 3,000 square meters of land, which will be aimed at a different public than the norm in La Zagaleta. “In this area, we could build townhouses, but that is not our thing. We will make an integrated resort, with private streets, similar to the luxury developments that exist in the United States, and where the nature of the surroundings mitigates prevailing winds found in the area,” the Director of Business Development pointed out. “The idea is to make homes without fences, like in Los Angeles or Florida, where you can see without being seen, and that incorporate the current demands of millennials,” he adds.

The objective of La Zagaleta is to pre-sell the homes so that each client can customise it during its construction. “We believe that buyers of these homes will be an international mix: people who like to play golf but we will also go after clients in Tarifa, which is very close to Valderrama 2. And don’t forget that we are 20 minutes from Gibraltar airport,” Ignacio Pérez stressed.

La Zagaleta has given itself three years to begin construction.” We will spend 2017 solving some critical steps and setting a timetable, but we want to have the development under construction by 2020 and then complete it rapidly.”

In total, the group plans to invest 200 million of its funds in developing the development over ten years. The total investment could reach over €400 million. “We will be building the homes, for example, at a rate of about 20 a year. The logical thing would be to finance them in the long term so that the buyer can easily take on the outstanding loan and buy the property with a smaller downpayment.”

Original Story: Expansión – Rocío Ruiz

Translation: Richard Turner

Neinor Invests €275 Million Up to September and Accelerates the Pace of Development

31 October 2017

The company has available land valued at 1.4 billion euros, enough to build 12,000 homes.

Neinor Homes accelerated the pace of its investments and pre-sales in the third quarter of 2017. In the first nine months of the year, the developer acquired 24 plots of land to develop more than 3,000 homes for 275 million euros, of which 103 million euros were invested just in the third quarter.

The company, which went public on March 29, finalised sales worth 169.4 million euros, in line with forecasts, and closed September with a net loss  of 6.1 million euros and a positive gross operating profit of five hundred thousand euros.

So far this year, Neinor has delivered five developments with a total of 185 homes, which has allowed it to generate revenues of 39 million euros. The rest of the proceeds came from its servicing business (21 million euros), through a contract that it has with Kutxabank for the management of the bank’s real estate assets, and especially the legacy assets, for 109 million, through the divestment of assets acquired as part of the agreement reached in 2014 with the financial entity.

The developer, led by Juan Velayos, has 71 developments in production, including some 5,500 homes, of which 2,000 units are in the construction phase, and will not reach cruising speed before 2020 when it expects to deliver between 3,500 and 4,000 homes annually.

Neinor executed pre-sales for 370 homes in the third quarter, totalling 1,080 pre-sold homes for the year, worth 368 million euros. The company’s total accumulated pre-sales reached €697 million with 2,101 homes.

Arrival in Portugal

The CEO of Neinor, Juan Velayos, explained that with the last quarter’s investments, the company had completed 100% of the purchases projected in its strategic plan for the whole of this year and 42% of its objectives for 2018. The company continues to analyse opportunities and has a pipeline worth 300 million euros.

Velayos announced that the company is studying investments in new markets such as, among others, Portugal. “The Portuguese market fits in with our strategy, the macroeconomic environment is propitious, there is limited supply and real demand, and the next step is to identify if land is available that can be bought at the prices we want, without forgetting the time factor. Licensing takes more time in Portugal than it does in Spain. ”

Taking advantage of opportunities in Catalonia

As for Catalonia, Velayos has indicated that Neinor’s exposure in the region is limited. Thus, although 16% of its total number of homes – some 30 developments and 1,900 homes – are in this area, of which, 1,500 homes are already in production, and more than 900 have been pre-sold.

In this way, only 4% of the value of its assets in Catalonia have not been taken up. “Catalonia has been a good play during these last two years even though there was already some political uncertainty; I am much more optimistic than just a few weeks ago. I think that common sense in Catalonia is going to recover,” he added.

Regarding the purchase of land in Catalonia to launch new developments, the CEO of Neinor explained that the firm is studying some operations in the region and that if they fit with their strategy, they will take advantage of them. “If windows of opportunity are opened, we are going to take advantage of them, Catalonia is an engine of the Spanish economy, and it continues to be so despite the circumstances,” he assured.

New board member

The company has altered the composition of its board of directors after the reduction in Lone Star’s participation, which sold 27% of the developer promoter in an accelerated operation, last September.

Thus, Neinor has announced the departure of proprietary director Dominique Cressot, Lone Star’s representative, and the appointment of Alberto Prieto as independent director. Thus, the number of independent directors now amounts to four out of a total of seven.

Prieto is currently Managing Director for Real Estate at BDO Spain and has extensive experience in the residential land market developed over more than 20 years at Knight Frank, of which he was CEO, and at BDO.

Original Story: Expansión – Rebeca Arroyo

Translation: Richard Turner

Nine Projects Planned in Barcelona Will Increase Tourist Capacity


24 August 2017

Developers planning four hotels, three guesthouses, a hostel and a block of apartments have requested permits in peripheral areas, the only areas allowed by the Colau plan.

While still waiting to discover what impact the terrorist attack of the 17th will have on the tourism sector, Barcelona had attracted new hotel investments. The nine projects will provide 900 beds and the developments are planned in peripheral neighbourhoods, the only areas in which the tourist accommodation plan that came into effect at the beginning of 2017 permits new accommodations.

Since then, the City Council has received nine license applications for projects in these areas, which are necessarily less attractive, being far removed from the principal tourist areas. The municipality has concluded that the projects all comply with the new municipal regulations put in place by the current mayor, Ada Colau.

The projects include four hotels, three guesthouses, a block of tourist apartments and a hostel, as the deputy mayor of urbanism, Janet Sanz, told Expansión.

The exact location of the hotels has not yet been determined. The only specific details that the municipal government provided were that the projects will be in Sants-Montjuïc, Horta-Guinardó, Sant Andreu, Sarrià-Sant Gervasi and Nou Barris, which will receive a guesthouse.

The Barcelona City Council has not provided any further details to date, although industry sources have given additional information on some of these projects.

The hotel with the greatest number of rooms, 200, will have four stars and will be in the neighbourhood of La Marina, in the district of Sants-Montjuïc, next to the fairground of Gran Via, at 40 Calle Alts Forns.

Another hotel, which will have one star and 70 rooms, will be located at 250 Meridiana, in the Sant Andreu district, near the La Sagrera interchange.

The new tourist accommodation regulations came after a moratorium that was imposed by Ada Colau in July 2015, just after being elected mayor. The measure prevented further licensing of hotels throughout the city, something that will now only be allowed in peripheral neighbourhoods. However, there were 72 projects that managed to circumvent the new regulations, because they had already previously acquired a license or certificate. Of these 72 hotels, about thirty have been opened and are managed by chains such as H10, Núñez i Navarro, Princess and Accor.

The new regulation divides Barcelona into four zones. In the first, which covers the most central and tourist areas, a policy of “de-growth” has been established: not only will new licenses not be granted, but, if one establishment closes, it cannot be replaced by another.

Zone 2, a first belt around the centre, is subject to a policy of “maintenance”: that is, no new accommodations will be created, but if an establishment closes, another would be allowed to take its place.

The growth of hotel spaces, in a “contained” way, will only be permitted in Zone 3. Projects must also meet other requirements, such as being located on wide streets and not exceeding a certain density threshold. The municipality will ascertain whether each project complies with regulations and if this is the case, it guarantees that the processing of the application will go forward. In Zone 3, regulations that are specific to the historical centres of the old municipalities that were eventually incorporated into Barcelona must also be considered.

Finally, Zone 4 includes three developing neighbourhoods that will also have their own urban regulations. They are La Marina, the future AVE station in La Sagrera and its surroundings, and the Poblenou neighbourhood, where the 22@ district was launched 15 years ago.

The effects of the plan

The tourism sector has assessed the Colau plan from different points of view. Initially, it opposed the plan, although the Barcelona Hotel Association has since softened its position because one of the effects of the regulations is that existing hotels will have much less competition.

Juan Gallardo, of Bric Consulting, predicts that, if the city maintains its attractiveness as a tourist destination, the plan could imply “a price increase”, which would be added to the price increases that occurred because of the moratorium.

The new regulation has been the subject of a total of 17 contentious-administrative appeals in the courts, although only one of them is demanding compensation from the municipality. If rulings are declared that are contrary to the Colau plan, the city council could be forced to rectify the plan and elaborate new regulations. The Barcelona Hotel Association is the author of one of the appeals because it believes that the regulatory reforms would force hotels in the centre of Barcelona that undertake renovations to reduce the number of rooms, which would condemn them to decline and eventual “decadence”, Gallardo pointed out.

Original Story: ProOrbyt Expansion – David Casals

Translation: Richard Turner

Ranking of the 20 Developers With the Largest Pipelines for Delivery over the Next Three Years


22 July 2017

The reawakening of the residential housing sector in Spain has brought with it a large group of developers that promise to build thousands of homes in the next three years. It is sometimes difficult to discover details, to find out which developer is behind each new project.

This analysis lists what the Spanish Coordinating Institute for Governance and Applied Economics, an independent research centre, has identified as the top 20 of the country’s largest real estate companies, ranked by the number of homes they will develop by 2020.

At the top of the list is Metrovacesa, a developer controlled by Santander, BBVA and Banco Popular, which in the next three years will bring 12,600 homes to the market and, considering Neinor, Aedas, Via Célere, Corp and Pryconsa, is the only company that already owns in its portfolio all the land needed to build the new homes.

In addition, the company headed by Jorge Pérez de Leza, controlled by three Spanish banking groups, is a break from the leadership of large international funds, which are behind the bulk of the companies that make up the top 20, and which are negotiating with local companies to purchase land together to meet their housing development projections.

To reach the tally of 80,000 houses in these companies’ development plans, the institute counted both current developments and those that can be developed in accordance with the available land and projected purchases of new land. The institute’s studies drew upon various sectoral sources.

Neinor Homes (Lone Star), expects to deliver 10,250 homes; Aedas Homes (Castlelake), 9,850; Via Célere (Värde), 6,200; and AELCA (Värde) forecasts 5,750 residential dwellings, complete the top five positions in a ranking where only two companies linked to the large listed construction groups appear: Acciona Real Estate with 4,500 dwellings and Realia (FCC) with 1,650.

Another company stands apart is the Catalan Corp, which is the only member of the ranking with no national presence and that focuses all its interests in its autonomous community, where it plans to develop 3,000 homes.

Among the new phenomena of the real estate development sector that stand out, in addition to the hegemony of large funds, is the family structure of many of the Spanish developers (Amenabar, Quabit, Pryconsa, Lar, Ibosa…); bank’s greater requirements for granting mortgage financing to local investors, with requirements such as down payments of more than 50%; and a focus on the customer.

An increase is expected in the number of developers that will be listed on the stock market, where in the short term there will be between eight and ten companies

“It is clear that the Spanish real estate development sector has learned from the crisis and now operates with completely different criteria. A key factor is a focus on the client, which for the first time in a long time has become an essential part of the real estate business. Developers who know how to connect with what the customer needs will be assured of survival in the market, and whoever does not will disappear, “says Jesus Sánchez Lambás, executive vice president of the Institute.

Among those that will survive, many will do so by listing on the stock market, where Neinor and Quabit can already found.  Aedas, Via Célere and Metrovacesa are expected to join them in the short term. Even more should soon join them in the near future. The institute forecasts that eight to ten companies should be listed on the stock market in the short term.

Original Story: El Confidencial – R. Ugalde

Translation: Richard Turner

Deloitte: House Prices Up By 9.5% In Madrid & 15% In BCN

1 October 2015 – Expansión

The signs of recovery in the Spanish real estate sector are strengthening. The first sign was the arrival of international funds interested in investing in real estate assets in Spain; and now the residential market is also beginning to show the first signs of recovery.

House prices in Spain increased in 2014 after six years of decreases. According to a Europe-wide study prepared by Deloitte, average house prices in Spain’s two main cities, Madrid and Barcelona, increased by 9.5% and 15%, respectively, between 2014 and 2013. “Prices in Spain are increasing at an annual rate of 10%. The Spanish market was last in the line, in terms of the recovery in Europe, but now that trend has been reversed” explains Javier García-Mateo, Partner at Deloitte.

These signs of recovery are clearer if we analyse the results for new builds in isolation. The product has been particularly badly hit in recent years due to the over-construction that took place during the boom. “The gap between new builds and second-hand homes has increased with respect to last year and this is a sign of recovery” says García-Mateo. “New build prices are beginning to rise compared with previous years when the difference with respect to second-hand homes was less as vendors had to reduce prices to find buyers”.

Despite this growth, house prices are still below the levels seen before the crisis. In this way, house prices in Spain increased by 4% between 2002 and 2014, compared with 7% in Germany and the USA, 50% in France and 52% in the UK, according to Deloitte. “It is the start of a change in the trend, but we are not going to see a return to the boom figures. We are seeing a recovery because prices decreased so significantly (during the crisis)”.


Since 2007, a record year for the sector, house prices in Spain have decreased by 39%, compared with an increase of 18% in Germany. In Europe, the most similar market is Ireland, where house prices have fallen by 41% over the last seven years. “Ireland is one or two years ahead of Spain; as such, it is possible that over the next few years, we will see similar data to that being seen in Dublin this year, where the price per m2 has risen by 34%”, say the Partners at Deloitte. (…).


The increase in house prices will have an effect on the launch of new developments, which reached minimum levels of 35,000 units in recent years. “We think that the recovery in the construction of homes will take place in 2016, starting from very low levels. Between 2006 and 2007, 7,000,000 homes were constructed in Spain, the same figure as in Germany, which has 90 million inhabitants”, says García-Mateo.

The construction of new developments will be reactivated despite the fact that Spain still has a stock of around 535,000 unsold homes. According to Deloitte, the stock of homes decreased by 3.2% last year and has recorded a cumulative decrease of 18% since 2009, when there were 649,780 unsold homes. “There are still a lot of homes to be sold because the population is not growing”.

In this sense, Spain, together with Italy and Portugal, is the country with the highest volume of stock at the European level.

Most of Spain’s provinces are now showing signs of recovery

The Spanish real estate market is very heterogeneous and that is reflected in the location of the stock of more than 500,000 unsold homes in the country.

According to the study prepared by Deloitte, the recovery of the residential sector is happening at three speeds across the country. The recovery will be seen first in Madrid, the Catalan provinces, Valencia and the majority of Castilla y León; meanwhile Almería, Huelva, Teruel and Castellón will be the last regions to recover.

Only three provinces still have a stock that is more than 10% larger than in 2009: Guipúzcoa, Teruel and La Rioja, which the supply of unsold homes has increased by 38%, 26% and 10%, respectively; meanwhile ten provinces have reduced their stock by less than 10% in the last five years.

At the other end of the spectrum the provinces of Cantabria, Cáceres, Badajoz and Navarra have pretty much reduced their unsold stock levels by 100% over the last five years.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake

Solvia: The 2 “Castillas” Are The Black Sheep Of The RE Recovery

24 September 2015 – El Confidencial

Spain’s real estate market is very heterogeneous. There is nothing new about that. Madrid, Barcelona, the Costa del Sol and the (Balearic and Canary) Islands have all been showing signs of recovery for several months now, in terms of prices and the launch of new property developments.

Nevertheless, there are other areas where the desired recovery is not happening yet and other still where it is not even expected to happen, at least in the short term. The two Castillas (Castilla-La Mancha and Castilla y León) are two of these regions. The key drivers of the recovery have not been seen there yet and prices continue to be subject to downwards pressure. Or at least, those are the findings of ‘Solvia Market View‘, the first report about the real estate market prepared by Banco Sabadell’s servicer.

“Castilla-La Mancha is a market that is not showing any signs of recovery yet, since it has a large stock and a significant number of assets for sale, which are continuing to drive prices down. A slight increase in prices is only being observed in the historical centres of certain provincial capitals, such as Toledo and Cuenca, mainly due to the shortage of supply in these locations..but that is it”, explains Javier García del Río, CEO of Solvia.

Castilla y León finds itself in a very similar situation. The first timid signs of recovery are only being seen in a handful of towns and cities, where there is a shortage of supply and demand has been withheld – buyers have been waiting for prices to bottom out or have not been able to obtain financing until now. (…). According to García del Río, the drivers of the recovery are weak in these areas (Valladolid and Salamanca) and the demographic make-up does not help the recovery in demand, therefore the volume of activity is still very limited. (…).

High expectations in the País Vasco

Despite the sluggish behaviour in the two Castillas, Solvia has identified a certain degree of expectation in other parts of the peninsula, such as in the País Vasco. In Guipúzcao, for example, constructors are starting to build small developments, although the market is still quite slow there. Meanwhile, in Vizcaya, prices are stabilising for both new and second hand homes, and sales volumes are flat, according to Solvia. However, it points out that no new developments are being started there yet, unlike in Madrid for example. (…).

The stock of homes to be absorbed in Álava is still plentiful. “The financial entities (Kutxa, Caja Laboral) are starting some new property developments, which will be sold at a reasonable rate if they are marketed at competitive prices and are supported by financing”, says Javier García del Río. Meanwhile, in La Rioja, the market is normalising, especially in the north of the region, since as well as primary residences, it also supplies second homes for people from the País Vasco.

Sales have increased in Logroño, with competitive prices and a normalisation in terms of financing, although there is still a sizeable stock of new homes there. Finally, Navarra is a market that is still relatively inactive, with few operations overall; meanwhile, there has been a significant reduction in stock in Aragón and several property developments are being started at competitive prices. (…).

Finally, in Galicia and the northwest of Spain, particularly in A Coruña, there is a limited supply and reasonable demand for homes at affordable prices. In Vigo, there has not been a real estate boom, due to the suspension of the general (housing) plan during the crisis, but there is demand for finished products, whilst in Gijón, there is demand for homes in central, well-located areas.

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake