Tinsa: House Prices Rose By 5%+ In Cataluña In 2015

19 January 2016 – Expansión

With an increase of more than 5%, Cataluna was the autonomous region where house prices rose the most in 2015, which saw the first nationwide increase since 2008. Specifically, according to data published by the appraisal company Tinsa, new and second-hand house prices rose by 1% in Spain last year; with the Community of Madrid and the Balearic Islands also helping to drive that increase, with rises of 3.3% and 2.7%, respectively.

The Catalan provinces reported the greatest increases. Most notably, prices rose in Gerona by more than 10%. In addition, prices in Barcelona and Lérida increased by 5%, whilst in Tarragona, the only province in the region where prices did not rise, they dropped by -1.7%. Significant increases were also recorded in other provinces, besides those mentioned above in Madrid and the Balearic Islands – they included Albacete (4.5%), Ávila (2.4%), Orense (2.2%) and Castellón (2.1%). Similarly, prices in Cuenca, Huelva, Toledo, Cádiz, Málaga, Cantabria, Salamanca, Alicante, Granada, Las Palmas and Santa Cruz de Tenerife rose in line with the national average, all recording increases of around 1%

At the other end of the spectrum, and in contrast to the behaviour seen in the other autonomous regions, house prices in Navarra dropped significantly, by -8.5% YoY. Prices also fell sharply in Murcia, by -4.5%, whilst in Aragón and Extremadura, prices fell by -3.6% and -3.4%, respectively. Meanwhile, prices in País Vasco dropped by -2% and in Asturias, the Community of Valencia and Galicia, prices fell by more than -1%.

In this context, house prices fell by the most in the province of Teruel: specifically, by -8.7%. Moreover, the decrease in Córdoba amounted to -7.7%, whilst in Palencia prices dropped by -7.1%, in Álava by -6.5% and in Zamora by -5.9%. Notable price decreases were also recorded in Ciudad Real, Almería, Burgos, Cáceres and León, where they dropped by more than 4%.

Tinsa’s IMIE index for the fourth quarter of 2015 also includes the behaviour of prices in cities: the ranking was headed by Barcelona, where prices rose by 8.7%. The second city was Badajoz, with an increase of 5.7%, and that was followed by Ávila, where the increase reached 4.3%. Prices in the capital of Spain rose by 3.8% and price rises of more than 3% were also recorded in Cuenca and Ciudad Real. In Palma de Mallorca, prices rose by 2%, in Segovia they increased by 2% and prices in Burgos, Málaga and Cádiz all rose by more than 1%.

The provincial capitals where prices decreased the most were Pamplona and Palencia, with a decrease of more than -10% in both cases. In Zamora, prices fell by -9.2%, whilst in León, they dropped by more than -8%. Huesca, Tarragona and Castellón all recorded price decreases of -7%, and prices in Vitoria fell by almost the same amount. In Murcia and Almería, prices dropped by more than -6% and in Zaragoza, Vigo and Lérida, prices decreased by between -4% and -3.2%.

Original story: Expansión (by Daniel Viaña)

Translation: Carmel Drake

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)”.

Ireland

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. (…).

Construction

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

Ministry Of Development: Housing Stock Falls By 5% To 535,734

31 July 2015 – El Economista

According to data published by the Ministry of Development, the stock of unsold homes in Spain fell by 5% in 2014, to bring the total down to 535,734 properties, i.e. 2.10% of the total housing stock.

The statistics are compiled on the basis of the termination certificates issued by the College of Technical Architects…as a reference for the number of finished homes, and using the Ministry of Development’s own real estate statistics about house sales.

This represents the second largest decrease since 2010, when the downwards phase first started. (…).

It means that the stock of empty homes has reduced by 17.5% since its maximum level in 2009 (649,780 properties). Overall, the housing stock is still 29.5% higher than it was in 2007, when there were 413,642 empty homes.

No stock left in Cantabria or Extremadura

The housing stock decreased in all regions in 2014, with the exception of Ceuta and Melilla. In fact, in the cases of Extremadura and Cantabria, the stock of homes was completely absorbed last year.

However, in this case, the Ministry of Development explains that the ‘stock’ represents the surplus above the levels recorded on 1 January 2004, and therefore zero surpluses do not necessarily mean that there are no unsold new homes left, but rather that the number of unsold new homes has not increased since that date.

Navarra led the decreases, with a reduction of 86.5%, followed by Galicia (-8.45%), Aragón (-6.76%), Andalucía (-6.72%), the Balearic Islands (-5.97%), Murcia (-5.48%), the Canary Islands (-5.37%) and Asturias (-5.19%).

Other regions recorded decreases below the national average, including: Madrid (-4.78%), Castilla-La Mancha (-4.66%), Castilla y León (-4.24%), Comunidad Valenciana (-3.14%), Cataluña (-2.99%), La Rioja (-1.76%) and País Vasco (-0.75%). Meanwhile, the stock in Ceuta and Melilla increased by 18.1%.

Following these changes, three regions now account for 49.6% of the stock: Comunidad Valenciana (98,087 homes), Andalucía (85,081 homes) and Cataluña (82,753 homes). Meanwhile, the regions and cities with the lowest stock percentages are Ceuta and Melilla (744 homes), Navarra (184 homes) and Cantabria and Extremadura, where there is no stock left. (…).

Original story: El Economista

Translation: Carmel Drake

Ministry of Development: Housing Stock Still Exceeds 500,000

23 July 2015 – El País

Spain is still slowly digesting the volume of unsold new homes that was left over following the burst of the housing bubble.

According to the Ministry of Development, the stock of newly constructed homes decreased by 5% last year with respect to 2013, to 535,734. The remnants of the bubble are concentrated in those areas in which developers constructed the most during the boom times, in such a way that the provinces with the highest number of vacant homes are: Castellón, Almería and Toledo. The sector warns that many of these properties, especially those in poor locations, will be very difficult to sell.

The stock of newly built homes peaked in 2009, when the market came to a standstill, large companies in the sector collapsed and assets started to move onto the balance sheets of the financial institutions. That year, the country registered almost 650,000 new homes without a buyer. Since then, the volume of unsold homes has declined at an annual rate of 3.6% per year. “A decline of 5% still represents a tiny amount” says José García Montalvo, professor of Applied Economics at the University of Pompeu Fabra (UPF).

The slow rate of decline is due to two main factors. Firstly, house sales are recovering, but in a very uneven way: whilst sales involving second-hand homes have increased by 42%, according to the National Institute of Statistics (INE), sales of new homes have decreased by 37%. This means that barely 20% of sales related to new homes, whereas between 2008 and 2013, they accounted for half of all sales.

The second reason is that the market has written off some of that housing stock as unsellable. “Some of the stock will never be sold” says García-Montalvo. Moreover, Bankinter’s study service estimates that around 150,000 homes will fall into that category, above all those located in ‘ghost’ towns and neighbourhoods, and in coastal areas where there is little or no demand.

This explains why the provinces with the highest volumes of vacant new homes are located on the Mediterranean Coast and in Castilla La Mancha. In relative terms, the provinces with the most unsold stock are Castellón (6.45% of the total), Almería (5.47%), Toledo (5.39%) and Albacete (4.31%). In Madrid and Barcelona, where the cranes have now returned to start new projects, that proportion stands at 1.4% and 1.7%, respectively. And according to the Ministry of Development, the stock is non-existent in Cantabria and Extremadura. (…).

The stock of empty homes still exceeds 10,000 units in around twenty provinces. In general, the decreases amounted to around 5% on average, except in Málaga (16.4%) and A Coruña (8.3%). At the other extreme, the volume of unsold homes actually increased in Álava, Bizkaia, Ceuta and Melilla, albeit from relatively low levels. (…).

Original story: El País (by Lluís Pellicer)

Translation: Carmel Drake

Tinsa: Madrid & Barcelona Lead Housing Market Recovery

1 July 2015 – Expansión

Tinsa’s IMIE Local Markets report says that Cataluña (with an increase of 1.3%) and Madrid (+0.6%) were the only regions that recorded house price increases during the second quarter 2015 with respect to the same period in 2014.

However, the speed of recovery is very different by region. In Navarra, Cantabria, Asturias, Valencia and Extremadura, YoY declines of more than 5% have been recorded, whilst in others, prices have also increased: Galicia and Castilla-La Mancha (by +0.6%, respectively) and País Vasco (+0.3%).

These figures have left Spain’s average price index in negative territory. It recorded a decrease of 2.9%, although that represented a slow down from the decline of 4.5% that the market ended the year (2014) with.

By province

There were YoY increases in six provinces, namely: Barcelona (+3.4%), Cuenca (+1.2%), Tarragona (+0.8%), Madrid (+0.6%), León (+0.4%) and Huesca (+0.3%). “With the exception of Barcelona and Madrid, where the evolution of prices in recent quarters seems to underpin the trend, we will have to wait and see whether this trend is consolidated in the other provinces”, says Tinsa in its report.

Meanwhile, there were decreases of more than 5% in 15 provinces. “If we analyse the behaviour of prices over the last four quarters, the province of Barcelona is the market that is displaying the clearest signs of recovery”, says the report. Madrid, Vizcaya, Girona and Toledo are the next best performing provinces in this ranking.

By capital

If we analyse data by capital city, we see that increases have been recorded in seven capitals. From highest to lowest, these were: Huesca (+5.2%), Barcelona (+4.9%), Málaga (+2.6%), Madrid (+2.5%), Guadalajara (+2.4%), Palma de Mallorca (+0.9%) and León (+0.4%). Meanwhile, prices in the cities of Burgos and León remained stable.

Decreases of more than 10% were recorded in four provincial capital cities (Córdoba, Almería, Oviedo and Ávila) in YoY terms and the reductions exceeded 5% in eleven capital cities during the last year.

Effort

Another interesting finding from the report is the level of gross financial effort required for the acquisition of a home, which has reduced between buyers since 2007. Specifically, it has decreased from representing 33% of annual income to 23%.

“If instead of taking into account the payment of the average mortgage, the calculation is performed on the market value of the home, according to Tinsa’s data, then buyers that have to make the greatest effort to buy a home are those in the Balearic Islands, where a borrower needs 12.2 years on average to pay off his property, versus the Spanish average of 5.8 years”, explains the document.

Finally, another important indicator is the average time it takes to sell a home in Spain, which currently stands at 10.6 months.

Original story: Expansión (by M. G. Mayo)

Translation: Carmel Drake

Fotocasa: Second-Hand House Prices Increase In 15 CCAA

6 May 2015 – Expansión

The price of second-hand homes increased by 1.1% in April compared to March, after seven months of continuous inter-monthly decreases. The increases were widespread: they were recorded in no less than 43 provinces and 15 autonomous communities, according to statistics from Fotocasa and the IE Business School.

Moreover, house prices increased in April in 460 of the 733 municipalities analysed in this report – 63% of the total, i.e. two thirds. Meanwhile, prices remained stable in 17 municipalities and decreased in 256.

The average cost per square metre of second-hand homes amounted to €1,636 last month. In terms of the quarterly variation, the price of second-hand homes (those aged more than two years old) increased by 0.4% with respect to January 2015.

Second-hand homes got more expensive last month in 15 autonomous communities, i.e. everywhere except for the País Vasco (-0.2%) and Navarra (-0.6%). The greatest increases were recorded in the Canary Islands (up by 3% in just one month) and the Balearic Islands (+2.3%).

This index shows the stabilisation of house prices in Spain. The fact that prices are continuing to increase month after month is an indicator of a trend towards recovery.

The quarterly variation was 0.4%, something not seen since February 2010, a rate that exceeds the variation recorded 12 months ago by 1.8 percentage points.

In terms of the evolution of house prices by province, of the 43 provinces in which price rises were recorded in monthly terms, the highest growth was seen in Toledo (7.4%). Prices decreased in just three provinces: Vizcaya (-0.1%), Navarra (-0.6%) and Palencia (-0.7%). House prices did not vary in four autonomous communities.

Unsellable stock

Meanwhile, BBVA Real Estate’s Research Department said yesterday that the stock of unsold homes is going to decrease significantly, although around 300,000 homes are practically “unsellable”. Despite that, the sector’s contribution to GDP will amount to around 5% in 2015.

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

Ministry Of Development: House Sales Grew In Every Province In 2014

13 March 2015 – Expansión

More homes were sold in 2014 than in 2013. That is a fact. The question is: how much did the market grow by? The official statistics do not tally (with each other). The Institute for National Statistics (INE) recorded an increase of 2.2% (in 2014), based on data from the property registers. Yesterday, the Ministry of Development revealed an increase of no less than 21.6%, based on data from notaries, which represents the greatest increase since it began publishing these statistics (in 2004), with a total of 365,594 transactions.

This is also the highest figure since 2010, although, of course, it is still a long way from the peak years of the real estate bubble (2007, when 837,483 transactions were recorded). One of the explanations for the disparity in the Government’s statistics stems from the fact that not all transactions recorded in the public registers are included (in the data). Moreover, there is typically a time lag, of a few months, between notarial information and data in the property registers.

In any case, the trend, which is really the important indicator in the real estate market, is becoming bullish once more. Not surprisingly, according to the data from the Ministry of Development, sales of residential properties increased by 2014 in every autonomous region, something that was unheard of in the years of the crisis.

Sales increased by the most in Madrid (44.7%), followed by Navarra (31.3%), Aragón (31.1%), Asturias (30.8%), País Vasco (29.3%) and the Balearic Islands (29.2%).

But the improvement in the market did not stop there. An annual increase was recorded in every single province in 2014. The largest rises were recorded in Ceuta (57.6%), Burgos (46.8%), Salamanca (39.2%), Zaragoza (38.2%), Guadalajara (37.9%), Vizcaya (34.3%), Melilla (34.1%) y Guipúzcoa (33.0%).

Foreigner buyers

House sales to foreigners resident in Spain also experienced a year-on-year increase in the last quarter of 2014, for the fourteenth consecutive quarter, specifically, by 19.7%, with respect to the fourth quarter of 2013, a total of 16,336 sales. Similarly, purchases by non-resident foreigners increased to 1,315 during the quarter, an increase of 13.4% on the previous year.

Overall, sales to foreigners (both resident and non-resident) accounted for 15.8% of all sales. By province, the greatest increases in the number of purchases by foreign residents were recorded in Alicante (3,852), Málaga (2,226), Barcelona (1,536), Madrid (1,285) and Baleares (1,126).

Finally, it is worth noting the healthy level of activity in the housing market in the fourth quarter of 2014, when 111,921 homes were sold in Spain. Not since 2010 have more transactions been recorded during the fourth quarter (150,494). This figure represents a year-on-year increase of 19.5%.

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake