Housing Price Increases Slow Down in Madrid and Barcelona

3 January 2020 The average price per square meter for a residence in Spain reached 1,373 euros in the last quarter of 2019, an increase of 2.6% year-on-year, according to a report by Tinsa. That figure represents the lowest inter-annual growth in almost three years.

Market watchers believe that the frenetic expansion of recent times in Spain’s principal markets is reaching an end. Average prices in Madrid rose by 1.8% between October and December, while falling by 0.8% in Barcelona. Year-on-year growth stood at 3% and 2.9% respectively.

Spain’s secondary markets are now the main drivers of growth. Palma, Santa Cruz de Tenerife, Valencia, Malaga, Zaragoza and Seville all saw increases of over 7% in 2019.

El precio medio por metro cuadrado de una residencia en España alcanzó los 1.373 euros en el último trimestre de 2019, un aumento del 2,6% interanual, según un informe de Tinsa. Esa cifra representa el crecimiento interanual más bajo en casi tres años.

Los observadores del mercado creen que la frenética expansión de los últimos tiempos en los principales mercados de España está llegando a su fin. Los precios medios en Madrid aumentaron un 1,8% entre octubre y diciembre, mientras que cayeron un 0,8% en Barcelona. El crecimiento interanual se situó en el 3% y el 2,9%, respectivamente.

Los mercados secundarios de España son ahora los principales motores del crecimiento. Palma, Santa Cruz de Tenerife, Valencia, Málaga, Zaragoza y Sevilla registraron aumentos superiores al 7% en 2019.

Original Story: Eje Prime

Translation/Summary: Richard D. Turner

Euronext Access Vies With MAB for Socimis

11 December 2019 – Euronext Access is increasingly competing for listings of socimis with Spain’s Alternative Market (MAB). The stock exchange is comparable to the MAB in that it is aimed at companies with smaller capitalisations. Euronext, however, has the added benefit of lower costs and requirements.

Those benefits, together with Euronext’s pan-European reach (with a presence in Belgium, France, Ireland, the Netherlands, Portugal, Norway and the United Kingdom), are leading a growing number of socimis to opt for a listing in Paris instead of in Madrid.

Armabex, a specialist firm in placing socimis in the MAB, is currently working with ten firms looking to debut on the French stock market in 2020. The president of the firm predicts that 20 or 25 Spanish socimis will opt for a listing on Euronext next year. If that turns out to be true, it would be a major blow to the MAB.

Since 2013, ninety-one socimis have listed in Spain, and seven of those are already trading on Euronext Access.

Original Story: El Confidencial – Ruth Ugalde

Photo: Reuters

Adaptation/Translation: Richard D. K. Turner

Investments in Shopping Centres Falls Due to Concerns about E-Commerce

18 December 2019 – Investments in 2019 in shopping centres totalled €1.018 billion in the year to September, the lowest level since 2013. The volume of acquisitions in the same period was just 35% of the level in 2018, when it reached €2.9 billion. Analysts expect that total acquisitions for the year will reach between 1.500 and 2 billion euros, according to a report by CBRE.

The fall in investment in the sector is in large part due to the untrammelled growth in e-commerce even as sales in shopping centres remain robust. The revenues generated by e-commerce in Spain increased by 22.2% year-on-year in the first quarter of 2019, reaching €10.969 billion and an 8% market share.

Original Story: Eje Prime

Adaptation/Translation: Richard D. K. Turner

European Real Estate Market to Prize Stable Income Streams in 2020

17 December 2019 – According to a report by Savills Investment Management, the big players in the European real estate market will begin to focus on more conservative investments in the coming year. Investors are expected to start looking for stable, long-term rental income streams in place of opportunistic bets.

The investment cycle in European rental markets is entering a period of reduced growth and heightened uncertainty due to weakened demand and economic and geopolitical developments. Consequently, analysts foresee anaemic economic growth over the next 12-18 months.

Savills IM, however, still sees significant opportunities in the office, retail and logistics sectors at the European level. In Spain, the firm expects the real estate sector to continue to see better than average performance in 2020, vis-à-vis the rest of Europe, despite the slowdown in domestic demand and weakness in external markets.

Original Story: Idealista

Adaptation/Translation: Richard D. K. Turner

Investment in Barcelona’s Office Market Reaches 20-Year High

17 December 2019 – Barcelona’s real estate office market is amid an investment boom and is projected to end the year with record investments of 1.7 billion euros. That figure is the highest of the last twenty years, according to a study by Savills Aguirre Newman.

In the year to date, investments in offices in Barcelona have hit 1.4 billion euros. Market sources also expect that another €300-€400 million in deals will be finalised before 2020. Investors, 75% of whom are from outside Spain, have concluded acquisitions of more than sixty buildings, totalling more than 400,000 square meters of surface area, in 2019.

Original Story: Eje Prime – Marc Vidal Ordeig

Adaptation/Translation: Richard D. K. Turner

Signs of Over-Development Seen on Spain’s Costa del Sol

12 December 2019 – Development on Spain’s Costa del Sol has taken off since the country has emerged from the housing crash. A boom is underway in the area between Málaga and Estepona where there are more than 200 developments under construction. Some of the developers are finding it increasingly more difficult to maintain the pace of sales, as oversupply, increased prices, and a generalised economic slowdown are beginning to bite.

The number of approvals for construction permits on the Costa del Sol has risen dramatically in the last year, reaching a level that is 50% higher than in Costa Blanca. Also, the issuance of construction permits in 2018 for the Costa de Sol rose by 50%, while there was a 10% drop in Costa Blanca.

The shortage of developable land has caused a sharp increase in the prices for both construction materials and the homes for sale. The price of land has doubled in the last three years, while house prices have been rising at annual rates of 8% and 10%, with even higher rates on the coast.

Original Story: El Confidencial – Elena Sanz

Adaptation/Translation: Richard D. K. Turner

Rental Prices Rising Throughout Spain

11 December 2019 – Rental prices in Spain’s less well-known provinces, such as Huesca, Ávila, Jaén and Burgos, are now rising at an above-average pace, compared to the rest of the country. Some of the greatest increases are coming in areas that have been known as the ’empty Spain’ and market watchers believe that the increases will continue during 2020.

According to Fotocasa, rents rose in 38 of Spain’s 47 provinces. The most pronounced year-on-year rises were in Santa Cruz de Tenerife (13%), Alicante (11.5%), Seville (11.3%) and Ávila (8.6%).

Original Story: El Boletin – Luis Suárez

Adaptation/Translation: Richard D. K. Turner

The Pace of NPL Sales Falters in Spain

6 December 2019 – Spanish banks have reduced their pace of sales of NPLs this year, as CaixaBank, Sabadell, Bankia, Bankinter, Unicaja and Liberbank unloaded a total of just 4.9 billion euros in the first nine months of 2019. Those financial institutions wrapped up the quarter with €35.006 billion of such assets on their books, 12% less than at the beginning of the year. In contrast, Spain’s banks in sold off €90 billion in non-performing loans and REOs in 2018.

Standard & Poor’s, on the other hand, published a report in February estimating that Spain’s banks should rid themselves of €30 billion in NPLS between 2019 and 2020. That figure would have lowered their collective NPL ratio to below 4% compared to 7% at the time. Both S&P and Spain’s central bank also argued that the banks needed to increase the pace of sales to prepare for a potential slowdown in the economy.

Original Story: El Economista – Eva Díaz

Adaptation/Translation: Richard D. K. Turner

 

Unemployment to Fall to Pre-Crisis Levels in Madrid

3 December 2019 – The Community of Madrid has had a series of years of growth above the average for Spain as a whole. According to the forecasts by BBVA Research, Madrid had the highest regional growth in 2018 and will continue to do so in 2019 ad 2020. Thus, in 2020, unemployment in Madrid is expected to fall to pre-crisis levels, which, until now, had only been done in the Balearic Islands and the Canary Islands.

BBVA Research stated that GDP in the Community of Madrid is expected to grow by 2.6% this year, a significant reduction in the pace of growth compared with last year (3.7%). The regional average for the country as a whole, however, only reached 1.9%. Next year, growth in Madrid is expected to fall to 2.2%, compared to the Spanish economy at 1.6%.

Original Story: Expansión – Pablo Cerezal

Adaptation/Translation: Richard D. K. Turner

Growth of Socimis Expected to Fall by Half in 2020 from High in 2019

2 December 2019 – The director of Business Development at Gesvalt, Luis Martín Guiraldo, believes that approximately 19 new socimis will be created in 2019, up from 15 last year. That figure, however, is expected to fall by half in 2020.

The future of the investment vehicle has become somewhat less certain with the formation of a left-leaning government coalition by the PSOE and Podemos political parties. In his report, Mr Guiraldo notes how concentrated investments by socimis are in Madrid and  Barcelona, with only two listed socimis based in other cities (Valencia and Marbella). Total investments follow a similar pattern, with small groups of foreign investors behind the majority of the firms. Government regulators are now expected to take a closer look at the market, dampening the enthusiasm for the sector.

Original Story: Idealista – Carlos Lospitao

Adaptation/Translation: Richard D. K. Turner