Congress Agrees that the Banks will Pay All Mortgage Costs, Except the Appraisal

13 November 2018 – Expansión

The political parties today agreed by majority that the new Mortgage Law will establish that notary expenses linked to the signing of mortgages will be paid by the banks and that the appraisal costs will be paid by customers.

Moreover, the notaries will carry out a questionnaire with each borrower to ensure that he/she understands all of the clauses in the mortgage contract, at no additional cost.

The Mortgage Law was presented again today at the Congress’s Economy Committee after the Government approved a royal decree law which stipulates that the Documentation Registration Tax (AJD) will be paid by the banks and not by customers.

The new Mortgage Law reflects that decision and makes it clear that the financial institution will pay for the first copy of the notary deeds; the customer will cover the cost of any copies he/she requests. Meanwhile, the registry costs will also be paid for by the bank; and the borrower will pay the appraisal expenses since he/she will be able to choose the appraisal company freely.

Nevertheless, several other important issues still need to be agreed, such as those relating to early repayment fees, late payment interest and the early termination clause of mortgages and which allows the foreclosure of homes depending on the debt that has been acquired by the borrowers (…).

On the other hand, the political parties will also have to decide about the entry into force of the new standards, given that the financial sector is asking for a margin of 6 months versus the 15 days that the draft bill is proposing.

The Mortgage Law, which is a transposition of a European directive, seeks to provide greater protection for consumers and promote transparency in the granting of mortgages, which is why the political parties have agreed that appraisal companies can be independent physical persons or legal entities (…).

Original story: Expansión

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

Notaries: Foreigners Bought 13.4% More Homes During H1 2017

27 November 2017 – Eje Prime

International players are setting their sights on Spain for investment. The purchase of private homes by foreigners amounted to 50,087 operations during the first half of 2017, which represents an increase of 13.4% compared to the same period last year, according to data from the General Council of Notaries.

Operations completed by overseas purchasers accounted for 19.4% of the total number of sale-and-purchase operations signed during the period, compared with 20.3% during the first half of 2016, although that figure has been increasing since 2007, in line with the start of the economic crisis.

If we differentiate between resident and non-resident foreigners, 46.6% of the purchases were made by non-resident foreigners, up by 5.1% YoY, which means that operations by resident foreigners accounted for 53.4%, the highest proportion since 2011. They grew by 21.8% YoY.

All of the autonomous regions reported progress in terms of the number of homes purchased by foreigners and only five of them recorded increases below the national average, which stood at 13.4%, specifically: the Balearic Islands, with just 5.3%; Andalucía, with 5.4%; Murcia, with 5.7%; the Canary Islands, with 10.1%; and the Community of Valencia, with 12%.

Finally, the average price per square metre of the operations undertaken by overseas buyers amounted to €1,667/m2, which represents an increase of 2.9% in YoY terms. Specifically, the price paid by non-resident foreigners rose by 4.5% to €1,941/m2, whilst the price of homes purchased by residential foreigners increased by 2.8% to €1,405/m2.

Original story: Eje Prime

Translation: Carmel Drake

Notaries: House Sales Rose By 8.6% In Sept To 40,094

20 November 2017 – Eje Prime

House sales are continuing to soar. The volume of residential transactions rose by 8.6% in September with respect to the same month in 2016 (and by 12.2% in the series corrected for seasonality) to 40,094 operations, according to data from the General Council of Notaries.

By type of home, the sale of apartments registered a YoY increase of 7.7% (up by 11.3% in the series corrected for seasonality) and the volume of private home sales rose by 8.%. This increase in the number of transactions involving private homes was due, exclusively, to the expansion of second-hand home sales (10%), given that the sale of new build homes decreased by 1.9% YoY. Meanwhile, the sale of family homes rose by 12% YoY.

In terms of average prices, the cost per square metre of the homes purchased in September 2017 amounted to €1,331/m2, whereby reflecting a YoY price increase of 2.4%. According to the notaries, this increase in the price per square metre of homes was due to both an increase in the price of family homes (1.4%) and an increase in the price of apartments (3.8%). Meanwhile, the price per square metre of private homes rose by 4%.

Original story: Eje Prime

Translation: Carmel Drake

Notaries: 48,695 Homes Were Sold In March, Up By 19.5% YoY

23 May 2017 – Aquimicasa.net

According to the notaries, March was a great month for the real estate sector. Despite the scare in February, sales of flats and houses rose by 19.5% in March, to reach 48,695 operations. But, since it can’t be all good news, it is worth noting the statistics published by the General Council of Notaries last Monday, which reveal that the average price of operations decreased by 1.3%.

Our analysis of the data published by the notaries shows that by type of home, flat sales recorded a YoY rise of 20.5% and sales of private (unsubsidised) properties rose by 21.9%. But, as has been happening for years, this increase in the number of private flat transactions was due, exclusively, to an increase in sales of second-hand flats, which rose by 26%, given that sales of new build homes continued their downwards trend, decreasing by 11.5%. Meanwhile, sales of houses and chalets saw a YoY increase of 15.6%.

If we look at the prices achieved, we see that the average price per square metre of the homes purchased in March stood at €1,277, which represents a decrease of 1.3% with respect to the same month last year. According to the notaries’ statistics, the decrease in the price per square metre of homes is due to a reduction in the price per square metre of houses and chalets (-6.2%), given that the price of flats did not vary in March.

Meanwhile, there was a slight increase in the average price per square metre of private (unsubsidised) flats, which rose by 0.3%, split between an increase of 0.8% in the price of second-hand flats and a decrease of -0.6% in the price of new build homes.

The sale of other types of properties saw 11,753 operations closed, which represents an increase of 15.2% compared to the same month last year. 39.7% of those transactions corresponded to plots of land. And despite the rumours of an increase in the price of land, that trend must be happening in specific areas only, given that the average price per square metre amounted to €155, representing a decrease of 10.4% YoY.

Finally, if we look at mortgages, during the month of March, they experienced YoY growth of 5.1%, to reach 32,070 operations, for an average amount of €156,229, in other words, a decrease of 3.4%. Meanwhile, mortgage loans granted for the acquisition of a property increased by 16.8% YoY, to a total of 23,542 contracts. Other mortgages included those used to build a home or to finance business activities.

Original story: Aquimicasa.net

Translation: Carmel Drake

What’s In Store For The Housing Market In 2017?

28 December 2016 – Cinco Días

“The real estate market can look forward to a new smooth and long expansionary cycle”. That is the consensus of the majority of analysts who have spent the past few days preparing their end of year report and forecasts for next year. Although the forecast figures are unlikely to coincide exactly, the fact is that the trend is unanimous. Provided there are no major macroeconomic changes, in other words, provided employment continues to grow and interest rates continue to remain a minimum levels, all of the experts consulted, be they property developers, construction companies, intermediaries such as the API, notaries, registrars, appraisal companies or bankers, agree that: 2017 will be better than 2016.

This does not mean that there are no clouds on the horizon. For the consultancy firm Knight Frank, the main risk is the political context at home and, to a lesser extent, overseas. “During the months when there was a caretaker Government, many projects were frozen; now the main uncertainty is whether the new Govenrment will manage to approve the budgets”, said Ernesto Tarazona, Managing Partner of Residential and Land at Knight Frank.

In this way, provided there aren’t any new political upheavals, 2017 will be the year in which more homes are sold and constructed and at higher prices. In terms of production, experts calculate that if this year around 70,000 new homes are going to be finished, then next year that figure should increase to around 100,000. Meanwhile, in terms of transaction volumes, next year could be the first year since 2008 when we see more than half a million homes being sold once again, according to Tinsa.

On the other hand, the forecasts vary the most when it comes to house prices, with predicted increases ranging from 2% to 5%. The VI Observatory of the sector, compiled by the Spanish Association of Value Analysis (AEV), together with the Head of the Applied Economics Department at the University of Alicante, Paloma Taltavull, and a group of 21 experts states that the evolution of house prices will be contained due to two essential factors: the stock that still needs to be sold or leased, of which they calculate that 25% is owned by the banks; and the weakness in terms of demand that still persists across the majority of the country. In the opinion of these experts, prices will end this year with nominal increases of around 3.8%, and will continue to rise by around 3% in 2017. Other sources, such as Bankinter, raise that percentage to 5%, due to the booms currently happening in the real estate markets in Madrid and Barcelona, where house prices are rising at double-digit rates given the scarcity of supply of new homes.

What all of the experts seem to have rejected is that the market may generate a new bubble over the medium term, given that: house sales are growing in a sustainable way, in line with new mortgages; and they are doing so in regions with the greatest economic activity and highest levels of job creation. Moreover, the recovery in terms of the promotion of new homes will act as a buffer to prevent one-off price spikes amounting to anything more. (…).

Original story: Cinco Días (by Raquel Díaz Guijarro)

Translation: Carmel Drake

Cranes Return To Spain After Almost A Decade Away

19 December 2016 – La Vanguardia

After nine years away, since the financial crisis first started to crush the real estate bubble in 2007, cranes have returned to form part of the Spanish landscape during 2016, They are a visible sign of the recovery that the real estate sector has been enjoying since 2014.

With just a few weeks to go before the end of the year, real estate investment is on track to set a new record in 2016, of almost €14,000 million, thanks to large-scale operations such as the merger of two giants in the sector, Merlin and Metrovacesa, to create the largest real estate company in Spain, with assets worth more than €9,300 million.

This year, the growth of the economy, improvement in employment, low interest rates, return of financing and the continuous inflow of foreign capital have combined to allow the real estate sector to consolidate its recovery despite the political uncertainty that hung over Spain for most of the year.

After almost a decade of paralysis, the property developers that survived the crisis and others created more recently have set cranes up on the streets, especially in cities with the most economic and tourism activity, where the “stock” is now practically non-existent and demand for new homes a reality.

Quabit is planning to invest €470 million between now and 2020 on the purchase of urban land on which it will build more than 3,000 homes; and Neinor Homes has set itself the objective of launching around 40 new developments this year and selling more than 1,500 homes.

The newly formed company Dospuntos, controlled by the US fund Värde Partners, plans to invest €2,000 million over the next six years and complete 2,000 homes per year from 2019 onwards. Vía Célere has just bought the largest available plot of land in the centre of Madrid from Repsol and Adif, which is ready for the construction of homes.

Inveravante, owned by the business man Manuel Jové, and the real estate subsidiary of BBVA, have joined forces to promote 850 homes; the German investment fund Aquila Capital and Ónice will spend €100 million building luxury homes in La Moreleja; whilst Ibosa will invest another €30 million converting the Hotel Foxá M-30 into homes.

The recovery of the sector is undeniable. According to the notaries, house purchases grew by 10.3% in September, a percentage that rises to 13.2% according to INE, after registering eight consecutive months of increases and growth of 10% in terms of the signing of mortgages for house purchases.

The Ministry of Development calculates that prices rose by 1.6% during the third quarter, to complete 6 consecutive quarters of increases, whilst permits for the construction of new homes soared by 32% in September to reach figures not seen since 2011.

Moreover, house purchases by foreigners grew by 19.7% during the first half of the year, with Britons leading the ranking, despite the threat of “Brexit”. (…).

During 2017, the number of transactions is expected to grow by 6.5% and prices are forecast to rise by 3.5% to reach 2004 levels. Meanwhile, Tinsa estimates that prices will remain stable or will increase by between 1% and 2%, at most, during 2017, in line with forecasts for the end of this year. (…).

Original story: La Vanguardia (by Cora Serrano)

Translation: Carmel Drake

IPE: House Prices Will Rise By 7.5% In 2016

28 November 2016 – Expansión

According to the Institute of Business Practice (IPE), house prices are booming, driven by a significant increase in sales (+17%). Mortgage lending (+8.7%) and building construction (+25%) are also underpinning the recovery of the sector, which will reach cruising speed in 2017.

Prices, sales, construction permits, mortgage lending, building construction, returns from rental properties…all of the major indicators in the residential market are growing at a strong pace in 2016, the year of consolidation for the real estate recovery. The housing sector has switched gears and is progressing, steadily, towards sustainable figures.

The end of year forecasts from the Real Estate Academic Arm of the Institute of Business Practice (IPE) confirm this trend. Firstly, the forecasts show that the average sales price of homes will rise by 7.5% this year (…). By the end of the year, the average home will cost €144,973, a level not seen since the end of 2012. It is worth remembering that, according to Spain’s National Institute of Statistics (INE), average house prices rose by 4.2% in 2015, the largest increase since 2007 (5.7%). If IPE’s predictions are correct, the price rise this year will be the largest increase since the recovery of the property market.

In addition, according to the XXII Real Estate Pulsometer from the IPE, house sales are soaring, by 17.2%, to reach 414,812 transactions, the best figure since 2010,and 9% higher than in 2013, which is when the sector bottomed out.

Permits and house starts are also rising, but they are starting from a very low base. Permits have increased by 25%, from 35,945 to 44,880. This forecast represents the most abundant activity in terms of cranes since 2012, but it is light years away from the years of the boom, when more than 700,000 house starts were recorded per year. The number of urban mortgages granted – over plots of land, homes, garages, premises, etc. – is expected to grow by 8.7% and the amount loaned is forecast to increase by 14.9%, according to the study, prepared using data from MAR Real Estate’s network of real estate agents and the Network of Qualified Real Estate Advisors, which has been cross-checked with official data from INE, the Ministry of Development, the College of Registrars and the Notaries.

Two speeds

At the same time, the surplus of unsold new residential properties is expected to decrease significantly. At the end of 2015, this stock amounted to 433,583 homes. In 2016, a quarter of that volume has been drained, with 326,295 units left. That figure is less than half the stock recorded in 2014 (675,945), according to the IPE’s study.

Almost all of the unsold homes are located in areas with limited demand or are properties that fail to fit with the current needs. By contrast, in the most established and sought-after areas, such as the centre of Madrid and Barcelona and along the main areas of the Costa del Sol, homes, and even land, are scarce. In other words, the recovery is still happening at two speeds, but the difference is less acute, in the sense that, it is now widespread across almost all of Spain.

What’s more, the residential rental market is recovering strongly (by 4.4% gross per annum, or 8.3% with capital gains) (…).

With these statistics, the residential market is heading towards its cruising speed. The outlook for 2017 is encouraging, although all indicators point towards a slow down in terms of the increase in house prices. (…).

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

Notaries: House Sales Rose By 20% In H1 2016

16 August 2016 – Expansión

House sales grew by 19.6% during the first half of the year, to amount to 225,551 transactions, thanks to a boost from second hand flat sales, according to statistics published by the General Council of Notaries. In other words, there were 1,239 transactions per day during H1 2016. These results represent the highest increase since the historical series was first compiled, back in 2007.

Moreover, these figures exceed the official ones, provided by INE last week, which reported 207,116 transactions between January and June, with an increase of 16.4% with respect to 2015 levels. This discrepancy is due to the fact that the General Council of Notaries obtains its sales data from the public deeds signed by notaries, whereas INE waits until sales have been recorded in the registry, which means a delay of one or two months.

In this way, 153,631 second-hand flats were sold between January and June, which represents a 19.29% increase compared with last year; such properties accounted for a third (68.1%) of all homes sold during the period. This data contrasts with the sale of new homes, which amounted to just 15,675 units during the first half of the year, representing a decrease of 13.6% compared to a year earlier.

The rest of the market was completed by other assets, such as plots of land, whose sales volumes rose by 12.1% YoY. It is worth highlighting that sales of buildable land grew significantly (by up to 33.2% in certain months), which shows the interest from property developers in starting new projects, as they sense a significant recovery in the real estate market.

Similarly, there is another trend: second hand homes are forming an increasingly larger part of the market. Thus, during the first half of the year, the sale of second hand homes accounted for ten times the sale of new homes, according to data from the notaries. This trend was maintained in June, when overall house sales rose by 7.1%, boosted by an 11.2% increase in second-hand home sales (29,052 units), compared with a drop of 33.4% in new homes sales (2,751 homes).

Prices

Price may be a key factor behind these differences, given that many owners of second-hand homes are still being forced to make large discounts, whilst those selling new homes (banks and property developers, in many cases) are able to wait a while before selling. (…).

At the end of June, the average price of a second-hand home stood at €1,418/sqm, which represented an increase of 6.1% compared with a year ago (€1,336/sqm). Meanwhile, in the case of new homes, at the end of the first half of the year, the average price amounted to €1,886/sqm, up by 12.7% compared with June 2015 (€1,673/sqm). As such, the average variation in house prices amounted to 7.5%. (…).

Finally, according to the statistics published by the notaries, 44.7% of the homes sold in June were financed using a mortgage with an average loan of €128,480, up by 0.4% compared with last year. These figures represent an increase of 13.3% in June with respect to the same month last year, with 18,904 new loans granted during the month.

Original story: Expansión (by P. Cerezal)

Translation: Carmel Drake

Notaries: Average House Prices Fall By 5.1% In 2016

18 July 2016 – Idealista.com

According to data provided by the General Council of Notaries, house prices (measured in €/sqm) have decreased since the start of 2016. Specifically, average house prices decreased by 5.1% between January and May to reach €1,261/m2. The average price in May was the lowest recorded so far this year and represents a 1.6% decrease compared with the same month in 2015.

The market for house sales normalised in terms of the number of operations during the fifth month of the year after two months of significant increases. In May, 38,845 transactions were signed, up by 11.4% YoY, but slightly below the number of operations recorded in March and April. According to the data published by the notaries, during the five months to May, 181,056 house sales were recorded, which represents an increase of 16.1% compared with the period from January to May 2015.

Sales were led by second hand apartments, which recorded 26,880 operations, representing an increase of 16.8%; they were also driven by family homes, which rose by 9.2% YoY to 7,885 transactions. Nevertheless, the sale of new homes decreased by 22.6% with respect to the same period in 2015 with 2,495 homes sold.

“The increase in house sales in May reflects the path underlying the recovery of the real estate market” confirmed the notaries.

In terms of price per square metre, the notaries found that during the fifth month of the year, house prices decreased by 1.6% YoY to €1,261/m2. Since the start of 2016, when prices amounted to €1,330/m2 (the highest figure in the last year), prices have recorded a cumulative decrease of 5.1%.

Original story: Idealista.com (by David Marrero)

Translation: Carmel Drake