Tecnocasa: Second-Hand House Prices Rose By 8% In H1

7 September 2016 – El Mundo

The average price of second-hand housing in Spain rose by 7.99% YoY during the first half of 2016, to €1,666/sqm, according to the XIII Report about the residential market, prepared by Tecnocasa and the University of Pompeu Fabra (UPF) using sale/purchase and mortgage data from the real estate company.

Despite the significant increase, this average price is still well below the maximum values that the market reached at the end of 2006 and the beginning of 2007, when the average cost per square metre of second-hand homes amounted to more than €3,500. (…).

The city of Barcelona, which saw a price rise of 9.45%, led the increases during the first half of 2016, followed by Málaga (9.21%) and Madrid (9.03%). In this way, the cost per square metre rose to €2,443/sqm in Barcelona, to €1,044/sqm in Málaga and to €1,835 in Madrid.

In this regard, Tecnocasa notes that “we are seeing a two-speed recovery”, given that prices in cities such as Guadalajara, Sevilla, Zaragoza and Valencia increased by less than 2% (during the same period).

At a press conference held to present the report, the Director of the Department for Analysis and Reports at the Tecnocasa Group, Lázaro Cubero, explained that rental prices are also increasing, in the same proportion, and the average mortgage is also rising (€91,808), which represents an increase of 9.8%, although still represent less than half the lending figures in 2007 (€185,462). In this sense, it is worth remembering that the average monthly repayment amounts to €367.

Cubero stated that prices are still “attractive” – they are 52% lower than they were in 2006 for Spain as a whole – and financing conditions are very favourable, thanks to low interest rates, at a time when vendors are still having to apply discounts to their initial asking prices to achieve a sale.

The CEO of the Tecnocasa Group, Paolo Boarini, indicated that financial institutions are still behaving in a conservative way when it comes to granting mortgages: they are granting 73% of the appraisal value, and “it is very hard for people with temporary contracts to obtain a mortgage; self-employed people also face challenges”.

Meanwhile, for the Professor of Economics at the UPF and the coordinator of the report, José García Montalvo, the increase in the uptake of fixed-rate mortgages is “a significant change in the right direction”. He criticised Spain in this regard, stating that variable rate mortgages do not account for 95% of the total market in any other country, given that this means all of the risk in terms of interest rate fluctuations is transferred to the client. (…).

On the other hand, the Tecnocasa Group brokered 4,327 house sales in Spain during the first half of the year, up by 22% compared with the same period in 2015, as well as 1,445 mortgages, up by 28%, through its network of 465 offices (19.23%) and 2,000 sales agents. (…).

Original story: El Mundo

Translation: Carmel Drake

Idealista: Rental Prices Rose By 1.8% In Madrid In Q1

8 May 2015 – El Confidencial

The property crisis; the difficulties faced by thousands of citizens when it comes to buying a home; and the havoc wreaked by evictions have all resulted in a significant boost to the (residential) rental market in Spain. Over the last seven years, many citizens and families have been forced out of the property market and, given their need or desire to become independent or start a family, their only exit has been through the home rental market.

Thus, although owned homes still win by a landslide over rented homes – 78% to 22%, i.e. a very similar level to the one seen at the end of the 1980s – the fact is that in recent years, the balance has tipped a little less towards the property side and although, many experts consider that it is unlikely that we will reach the levels seen in other parts of Europe, where rental properties account for 50% of the residential market in some countries, it is clear that something is changing. “The rental market is here to stay and not just as a lifestyle option, but also as an investment”, says Fernando Encinar, Head of Research at idealista.com.

The rental market in the Community of Madrid is showing the first signs of recovery, as too is the sale and purchase market. Similarly, some areas are sparking greater interest than others in terms of demand, which, in turn, is starting to create a certain amount of tension in terms of prices.

The differences between neighbourhoods are clear. It does not cost the same to rent a flat in the centre of the capital or in the neighbourhoods of Chamberí and Salamanca, where the price per square metre is around €14/m2 (€1,120 for an 80m2 flat) as it does in Villaverde, Carabanchel or Puente de Vallecas, where the price per square metre barely exceeds 8€ (640€ for an 80m2 flat).

These price differences are explained, in part, by the location of the homes – clearly, it does not cost the same to live in the centre of the city as it does in the suburbs – but also due to the excess supply, in places such as Carabanchel and Vallecas, and the strong demand, in areas such as Sanchinarro and Las Tablas, where the experts detect a lot of activity due to the presence of Telefónica and the future arrival of BBVA.

(….)

The tension in terms of rental prices is palpable. Madrid ended the winter with a quarterly increase in rental prices of 1.8%, taking the average price per square metre in the capital to €11.60, however, that represents a cumulative decrease of 15.8% from its record high of €13.80/m2 in 2008.

Moreover, during the first three months of the year, the increase in rental prices was generalised, with rises in almost every district in Madrid, with the exception of Villa de Vallecas and the neighbourhood of Salamanca, according to the data from idealista.com, which also reflects significant increases in the districts of Barajas (5.8%), Retiro (4.7%) and Hortaleza (3.6%).

(….)

Original story: El Confidencial (by Elena Sanz)

Translation: Carmel Drake

Housing: Rental Prices Are On The Rise In 7 Autonomous Regions

29 January 2015 – Expansión

Trend/ The rental market is showing signs of improvement, after seven consecutive years of decline. Rental prices are increasing again in seven autonomous regions and are now stable in three.

The trend in rental prices is starting to change. After seven years of uninterrupted decreases, there were signs of stabilisation in the market in 2014. Overall, prices decreased by 1.9%, but that represented the smallest decreased since the golden years of the bubble, in 2007. Moreover, rental prices in 10 autonomous regions are no longer falling (they are increasing in seven and stable in three).

Those are the main conclusions of a report, prepared by Fotocasa.es in collaboration with the IESE Business School, about Rental Housing In 2014. “In the space of a few months, we have gone from seeing decreasing rental prices across almost the whole country, to seeing year-on-year increases in seven autonomous communities; furthermore, the scope for further downward movement is now limited in certain other areas”, says the study.

The Balearic Islands led the return to rental increases, with an annual rise of 6.7%. It was followed by Cataluña (6.5%), Pais Vasco (6.1%), the Canary Islands (1.8%), Madrid (0.6%), Extremadura (0.5%) and Valencia (0.2%).

Moreover, for the first time in seven years, none of the autonomous regions recorded rental price decreases of more than -5%. In fact, the sharpest decline was in Castilla-La Mancha (-3.4%), followed by Asturias (-3.2%), Navarra (-2.9%), Murcia (-2.3%) and La Rioja (-2.1%).

“The year-on-year variation in 2014 (-1.9%) is more than three points lower than the decline recorded at the end of 2013 (-5.2%) and it brings us back to pre-crisis levels”, said Fotocasa.

Rental prices in Spain reached their historical peak in May 2007, at €10.12 per sqm per month. Since then, they have declined by 33.1% overall, with Aragon (-42.5%) and Cantabria (-37%) being hit particularly hard.

The report identifies 86 municipalities that recorded rental price increases last year. The most notable increase was in San Sebastián, the city with the most expensive housing in Spain (12.7%), followed by Sant Pere de Ribes (11.7%) and Calvia (11.5%).

In Spain’s two largest real estate markets, the changing trend is catching on more quickly. In 2014, the rental price per sqm increased in 10 of the 21 districts in Madrid and in 9 of the 10 districts in Barcelona.

Madrid and Barcelona

The most notable increase in the capital was in the Retiro district (5.5%), followed by the Centro (5.3%), Chamberí and Salamanca (4.1% in both). And the most marked decreases were in Vicálvaro (-7%), Puente de Vallecas (-5.7%) and Villaverde (-5%).

Meanwhile, in Barcelona, the largest increase in rental prices was recorded in the district of Les Corts (12.9%), followed by Eixample (9.8%), Ciutat Vella (9.4%), San Martí (8.8%) and Sarria-Sant Gervasi (8.5%). The only district to experience a decrease was Sant Andreu (-1.2%).

The most expensive area to rent a home in Barcelona is Ciutat Vella, with a average price per sqm per month of €13.60, followed by Sarria-Sant Gervasi (€13.04). Meanwhile, the most expensive district in Madrid is Salamanca, with an average price of €13.04 per sqm per month, followed by Chamberí (€12.96).

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake