INE: Lack of Rental Homes Boosts House Purchases in Canary Islands

12 May 2018 – Canarias 7

During the first quarter of the year, 6,373 homes were sold in the Canary Islands, up by 20% compared to the same period a year earlier, and 8 percentage points higher than the national average. Every day between January and March, 70 homes were sold, 12 more per day than in 2017. Moreover, operations involving new build homes grew by more than those involving second-hand homes for the first time.

The lack of rental homes in the Canary Islands is boosting the volume of house sales in the archipelago above the national average. And that is because buying a flat is the only way of securing a home in certain areas of the archipelago, according to warnings from real estate experts.

Data published on Friday by Spain’s National Institute of Statistics (INE) confirm the trend in the Canary Islands’ real estate market. During the first quarter of the year, 6,373 homes were sold on the islands, which represented an increase of 20% with respect to the previous year. Every day between January and March, 70 homes were sold, 12 more per day than in 2017.

During Q1 2018, 1,001 more operations were closed in the Canary Islands than during the same quarter last year, according to the Statistics for the Transmission of Property Rights published by INE. At the national level, the increase was half that figure, 12%: between January and March, 128,348 homes were sold in Spain compared to 114,965 a year earlier.

In terms of the type of homes sold in the Canary Islands, for the first time since the outbreak of the crisis, the number of new home sales grew by more than the number of second-hand home sales. Operations involving new builds are fewer in absolute terms but they are growing more rapidly. Between January and March, 1,333 new homes were sold in the Canary Islands, up by 22% compared to the same period in 2017.

Meanwhile, 5,040 second-hand homes were sold, up by 17.8% compared to a year before, according to data from INE.

Price rises

House prices are going to rise by 5% on average this year, i.e. by almost twice the rate they grew by in 2017, according to forecasts from BBVA Research reflected in its magazine, the Real Estate Situation in Spain.

Similarly, the bank’s research department predicts that the volume of operations will reach 570,000 this year, up by 7% compared to 2017. In terms of new home permits, the forecast is that 93,000 will be signed by the end of the year, up by 15% compared to 2017.

In general, the potential demand for housing is expected to grow by between 1 and 1.4 million over the next 10 years, which translates into an annual average of between 95,000 and 135,000 households.

Original story: Canarias 7 (by Silvia Fernández)

Translation: Carmel Drake

Ministry of Development Will Report Variations in Rental Prices Every Quarter

29 January 2018 – Eje Prime

The Government is taking an interest in the rental market. The Ministry of Development is planning to report on the evolution of rental housing each quarter with new statistics reflecting different data and aspects of the market.

The report will be compiled by the Ministry’s Observatory for Housing and Land, which will analyse the situation in the market, which is currently booming in Spain. The increase in prices in this segment in certain cities, such as Madrid and Barcelona, is coming close to setting new records, driven by the increasingly high demand for these types of assets. In 2017 alone, residential rental prices rose by 8.9% across the country, led by Cataluña, where rental house prices increased by more than 10%.

The team that is going to launch this new quarterly report is already working to compile the first edition, gathering information and forecasts on the rental market from the main bodies and public institutions, as well as from companies in the private sector.

Similarly, the Ministry of Development is going to publish research that will reveal citizens’ perceptions of rental housing in order to, according to the public body, “identify the main problems and barriers facing the segment”.

Currently, the Government of Spain has the Housing Plan for 2018-2021 on the table, pending approval by the Council of Ministers. With that, young people aged under 35 years will receive financial assistance of up to 50% to cover the cost of renting their homes, taking into account the salary level of the claimant and provided the cost of the rental contract does not exceed €900 per month.

Original story: Eje Prime

Translation: Carmel Drake

Tinsa: Appraisal Values Rose By 3.6% Across Spain In May

7 June 2017 – Expansión

The appraisal value of homes rose by 3.6% in May, according to the appraisal company Tinsa. This increase was primarily due to the good times being enjoyed in the sector in Spain’s major cities and provincial capitals, which saw price rises of 6.1%. This shows that the most populated areas are the regions experiencing the greatest buyer impetus, which are, in turn, boosting the main residential sub-markets, above all in Madrid and Barcelona.

“Prices are rising a lot, it’s true”, said José Luis Ruiz Bartolomé, Partner at Chamberí AM. “The rises are being concentrated in certain areas in which there is a risk of the market heating up again because there is little land. It is already happening in Madrid and Barcelona”. But, is there a risk of a bubble? “Not yet”, he answers.

Sources at Tinsa agree, given that its latest forecasts show that house prices will rise by 2% this year, according to Jorge Ripoll, Direct of Research at Tinsa, who recently spoke to this newspaper.

Each month, the IMIE index, which is calculated on the basis of house appraisals performed by the company, reflects the YoY variation in the value (per square metre) of residential properties and its level with respect to the year 2001 (base 1,000). The 1,387 points in the general index reached in May “reveal that the average price in Spain has returned to its December 2013 level”, according to data from the appraisal company. If we compare this with the previous cycle, before the outbreak of the crisis, house prices now are equivalent to those last seen in September 2003.

After the capital cities and Mediterranean Coast, the YoY growth seen in the Balearic and Canary Islands (2.9%) also stands out. The two island regions were the forerunners of the recovery, but now they are experiencing moderate growth rates, which indicates that they could be close to reaching their cruising real estate speeds.

They are followed closely by smaller towns (+2.2%), which are grouped together in the Index into a category that Tinsa calls “Other towns”. Meanwhile, the metropolitan areas saw prices remain relatively stable compared to May 2016, recording just a slight decrease of just -0.3%.

House prices are still reducing the gap generated since the end of 2007. The cumulative price decrease still amounts to 39.2%, according to Tinsa’s statistics. On the Mediterranean Coast, the area that has been hit the hardest over the last 10 years, the cumulative decrease still amounts to 45.6%, just one point higher than in the metropolitan areas, where prices have fallen by 44.5% on average since their peak. In the capitals and major cities, the cumulative decrease amounts to 41.3%, just above the national average. Homes on the Balearic and Canary Islands have depreciated by 27.7% over the last ten years and those in other towns have fallen by 35.9%.

Inflationary fears

But, even though prices in the residential market are still well below the levels seen during the bubble, inflationary fears are returning. “Players are afraid of coming last and there is a shortage of land, so property developers are buying up plots so as not to miss out”, said Ruiz Bartolomé (…).

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

Fotocasa: Rental Home Prices Rose By 9.5% YoY In Q1

28 April 2017 – El Mundo

The average price of rental housing in Spain rose by 9.5% YoY and by 5.9% QoQ during the first quarter of 2017, according to the Real Estate Index compiled by the online portal Fotocasa. In this way, the average rental home cost per square metre amounted to €7.93/m2 as at March 2017.

This quarterly increase in rental home prices was in line with the trend observed in 2016. In the absence of official statistics, the index from Fotocasa corroborates the anecdotal evidence being seen on the street.

“Rental prices are rising significantly because demand is much higher than supply, above all, in those areas with the largest volumes of economic, tourist and demographic activity. Month after month, in regions such as Cataluña, Madrid and the Balearic Islands, we are seeing how the distance between the peak prices recorded in 2007 and 2008 is decreasing, and in some cities in those areas, the price per square metre has now reached the pre-crisis maximum, such as in the case of Barcelona”, explained Beatriz Toribio, Head of Research at Fotocasa.

In fact, the increase recorded during the first quarter of 2017 is the most markedsince Q1 2007, according to the Real Estate Index, when prices rose by 4.9%. Since then, the quarterly rental price has done nothing but decrease, with some exceptions in one-off quarters in 2011 and 2014. In 2015, the quarterly rental price began to recover, with increases of 2.8% and 1.5% in the first and second quarters, respectively, trends that continued in 2016, with the exception of Q3 2016, when prices fell by 2%.

At the inter-annual level, rental prices rose by 9.5%, the most marked increase in the history of the Real Estate Index, which has been compiled since January 2006. Moreover, during Q1 2017, rental prices rose in 14 autonomous regions at the quarterly level and in every region at the annual level. (…).

Evolution by autonomous region and province

Since reaching their maximum price in May 2007 (of €10.12/m2), rental home prices have recorded a cumulative decrease of -21.7%. In this regard, only three autonomous regions have recorded cumulative decreases of more than 30% since they peaked five years ago. In this way, Aragón is the autonomous region where rental prices have fallen by the most (-38.7%), followed by Castilla-La Mancha (-34.1%) and Cantabria (-31.3%).

During the first quarter of 2017, rental price increases were recorded in 14 autonomous regions, with the rises ranging from 5.4% in Cataluña to 0.4% in Castilla y León. Regarding the evolution by province, rental price increases were recorded in 36 provinces with respect to December 2016, with the rises ranging from 8.6% in Guadalajara to 0.2% in Alicante. By contrast, rental prices decreased in 14 provinces with the reductions ranging from -0.2% in Toledo to -3.6% in Ávila. (…).

By municipality, the town with the highest rental price was Barcelona, at €15.15/m2/month, followed by Eivissa (€14.60/m2/month), Sant Cugat del Vallès (€13.41/m2/month), Sitges (€12.85 /m2/month) and Castelldefels (€12.85/m2/month).

Original story: El Mundo

Translation: Carmel Drake

Tinsa: House Prices Rose By 5.5% In Large Cities In March

19 April 2017 – Expansión

The latest statistics confirm the continuation of the good vibe in the housing market, which is advancing at cruising speed thanks to the boost from large cities. Last week, the appraisal company Tinsa reported that the average appraisal value of residential properties experienced a YoY increase of 2.7% in March.

The YoY price rise amounted to 5.5% in large cities, which account for 40.8% of the market, according to the weighting that Tinsa applies to calculate the statistics. Major cities saw their positive evolutions accelerate in March. Although the average price in January was 1.5% higher than at the end of 2016, the increase during the first three months of the year amounted to 3.5%, thanks to the fact that the rise in March was 2.2 points higher than in February.

Once again, the most marked price increases were recorded in the Balearic and Canary Islands: up by 7% on average. In both cases, the increase in demand for holiday homes and in purchases made by overseas investors, are spurring on the recovery in the real estate sector.

Something similar is happening on the Mediterranean Coast, which saw prices rise by 1.9% YoY, despite the huge surplus of new unsold properties in certain provinces in the region, above all in Castellón.

The cities and the coast are the two segments where the housing market has performed the best traditionally, due to the high level of demand. In the case of provincial capitals, due to the creation of new households and, above all, the marked increase in purchases made by investors. Those two variables, combined with the strong rise in the rental market, mean that Madrid and Barcelona are continuing in their role as the real engines of the housing market.

In aggregate terms, the residential market is following the positive trend with which it started the year. The growth of 2.7% is almost one point above the figure recorded in February (1.8%). These increases are in line with Tinsa’s forecasts for 2017. The Head of Research at the appraisal company, Jorge Ripoll, revealed his predictions: growth will be almost flat this year, “ranging between 0.1% and 2%”. This is a moderate estimate, compared to those published by other analysts. Overall, the consensus amounts to around 5%.

The other two real estate sub-markets analysed by Tinsa experienced a YoY decrease in prices in March. The metropolitan areas and “other municipalities” saw reductions of -0.5% and -0.6%, respectively, over the last 12 months.

“During the first quarter alone (January, February and March), average prices in Spain rose by 3.2%”, according to Tinsa’s report. “The cumulative decrease since the peaks of 2007 now stands at 39.4%”. In other words, it has fallen below 40% for the first time since June 2014.

The largest decrease in prices since the peaks of 2007 was recorded on the Mediterranean Coast (down by 45.5%), followed by metropolitan areas (-44%) and then the provincial capitals and large cities (-42.1%). In the Balearic and Canary Islands, where historically, prices have decreased by the least, the cumulative reduction amounts to 24.2%.

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).


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

INE: House Sales Grew By 16.8% In March

11 May 2016 – El País

House sales increased by 16.8% in March with respect to the same month in 2015, to reach 31,925 operations, according to statistics about the transfer of property rights published by Spain’s National Institute of Statistics (INE). As such, sales recorded two consecutive months of YoY increases, as they also rose in February, by 15.8%. However, the number of transactions in March decreased with respect to the previous month, when 34,771 agreements were signed, and also deteriorated with respect to January (32,417).

Fernando Encinar, Head of Research at Idealista, explained that “the data shows that the normalisation of the market is a reality and seems to be strengthening, with the volume of house sales exceeding 30,000 units each month. However, we will have to wait and see what happens over the next few months, as this easing of the growth rate may indicate that we are approaching the natural sales figure for our sector”.

Once again, INE placed the focus on what it regards as second-hand homes, figures that include new unsold properties that have been on the market for more than two years. In this segment, the volume of transactions increased by 24.2% in YoY terms in March, to reach 25,765 operations, compared with a decline of 6.6% in the sale of new homes during the month, to 6,160 units. Overall, 19.3% of the homes that changed hands were new builds and 80.7% were second hand properties.

There was no variation in terms of the split between unsubsidised and subsidised homes. Just like last month, unsubsidised homes accounted for 89.2% of all sales, whilst the latter represented 10.8%. In annual terms, the number of unsubsidised homes sold rose by 16.5% and the number of subsidised homes sold increased by 18.9%.

The regions with the highest number of sales per 100,000 inhabitants were the Canary Islands (127) and the Balearic Islands (108). The regions that reported the highest YoY variations in terms of the number of house sales were the Canary Islands (52.7%) and Extremadura (34.6%). Meanwhile, La Rioja and Galicia (both with decreases of -3.1%) recorded negative annual growth rates.

Original story: El País (by Sandra López Letón)

Translation: Carmel Drake

Average Land Prices Rose By 9.7% To €156.4/m2 In Q3

16 December 2015 – Expansión

The average price of urban land is starting its recovery. During the third quarter of 2015, the average price of land sold in Spain amounted to €156.4/m2, up by 9.7% compared with the previous year, according to statistics from the Ministry of Development. This increase is five percentage points higher than the one recorded in the previous quarter.

This price increase, the highest in a decade, is due, above all, to the recovery experienced in municipalities with more than 50,000 inhabitants, where urban land prices increased by 58.7% YoY, to reach €331.1/m2, the highest figure since Q4 2012.

This sharp increase has two main explanations. Firstly, there are more operations than before, and they are more expensive. 9.2 million m2 of land was sold, with a value of €790.2 million (representing an increase of 72.3% YoY in terms of surface area and 18.4% in terms of value). With such low starting points, the increases are very significant. Secondly, the volume of transactions is not yet sufficient for us to stop talking about volatility.

Cities in Murcia experienced the highest increase in urban land prices in the third quarter (by 189.2% YoY), followed by cities in Castilla y León (74%), Asturias (69%) and the Community of Madrid (63%).

At the opposite end of the scale, municipalities with more than 50,000 inhabitants in Castilla-La Mancha recorded the highest depreciation in the price of land allocated for the construction of buildings (-27.5%), followed by those in the Canary Islands (-14.7%) and those in the Balearic Islands and PaísVasco, which recorded decreases of 4.1% in both cases, according to the breakdown of the Government’s statistics, which were compiled using data from the Association of Property Registrars (el Colegio de Registradores de la Propiedad).

Historically low prices in Sevilla

The highest average prices in municipalities with more than 50,000 inhabitants, were recorded in the provinces of Madrid (€660.4/m2, the highest price since Q2 2012), Guipúzcoa (€557.1/m2) and Barcelona (€539.1/m2). The lowest prices were recorded in the provinces of Albacete (€36.7/m2), Sevilla (surprisingly, at €128.1/m2, the lowest average price since the Ministry of Development began to compile records in 2004) and Cádiz (€141.6/m2).

During the third quarter of 2015, 4,192 transactions were closed, up by 9.8% compared with the second quarter 2015 and 2.4% fewer than in Q3 2014, when 4,293 plots were sold.

447 transactions were recorded in municipalities with fewer than 1,000 inhabitants, an increase of 1.1% compared with the same quarter a year earlier; in municipalities with between 1,000 and 5,000 inhabitants, 694 plots were sold, down by 20%. In towns with between 5,000 and 10,000 inhabitants, 554 plots were sold, down by 2.5% YoY. In towns with between 10,000 and 50,000 inhabitants, 1,738 transactions were recorded, up by 22.6%. And in cities, 769 plots were sold, down by 23.7%.

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

INE: Land Sales Increase By 10.5% In 8m To Aug

27 October 2015 – Cinco Días

This week has seen the conclusion of the two major annual events in Spain’s real estate calendar: the Real Estate Trade Fair in Madrid (SIMA) and Barcelona Meeting Point. In addition to a sharp increase in the number of private visitors, this year more companies have wanted to be present at both events, because the figures clearly show that more houses are being sold, at higher prices (the price decreases have now come to an end across most of the country) and most importantly, new properties are being constructed once again.

Given that land is the raw material required to launch new developments, it was crucial for funding to return to this segment of the market as well, and the statistics show that the trend there is now reversing. Not only are more mortgages being granted to acquire homes and complete developments abandoned due to the crisis, loans are also being granted once more to buy land. (…)

According to the latest available statistics, compiled by INE, for the period from January to August 2015, 48,905 plots of land were sold in Spain during the first 8 months of the year, an increase of 10.5% compared with the same period in 2014 (when 44,237 plots were sold). If this trend continues, 2015 will close with a significant increase on the number of plots of land sold last year (65,821), breaking the downward trend that began in 2007 (the first year this data was collected) when 195,269 plots of land changed hands.

What are investors looking for?

In terms of whether more or fewer mortgages are being granted on the plots of land being sold, the figures do not yet reflect an overwhelming improvement (…).

Again, according to INE, between January and July (the data for August is published today), 4,897 mortgages were granted for plots of land, a decrease of just 1.6% compared with the same period last year, when the number amounted to 4,979. Like in the case of land sales, if the trend in mortgages granted for land is maintained between now and the end of the year, then 2015 will close with an increase in the number granted for the first time since 2009.

For the experts and everyone now working in the real estate sector (including the banks, the Socimis and the new servicers), the fact that financing has returned to the land segment is very good news, since this will revive the construction of new builds. Above all, we are now starting to see studies that show that one of the imbalances on the horizon in the market is the lack of offices, developable land and industrial warehouses in prime and other good locations in cities, which is what exactly national and international investors are looking for.

Finally, if this trend continues and improves, it will be a great relief for the banks, since 37.8% of the almost €80,000 million in foreclosed real estate assets that last year weighed down on the balance sheets of the main Spanish financial entities (Santander, BBVA, CaixaBank, Sabadell, Popular, Bankia, Bankinter, Kutxabank, Unicaja, Ceiss, BMN, Liberbank, Ibercaja-Caja3, Novagalicia and Catalunya Banc) related to land, the same percentage as for finished homes, which accounted for 37.1% of the total, according to a study by the Department for Research and Economic Analysis at La Caixa.

Original story: Cinco Días (by Raquel Díaz Guijarro)

Translation: Carmel Drake

The Non-Hotel Overnight Stays Increased By 7.1% In July, To 18.5 Million

1 September 2015 – Expansión

Overnight stays in non-hotel tourist accommodations (apartments, campsites, rural tourism and hostels) built a rise of 7.1% in July, surpassing 18.5 million, according to data released this Monday by the National Statistics Institute (Instituto Nacional de Estadistica, INE).

In particular, overnight stays of residents increased by 8.7%, to over eight million, while those of foreigners rose by 5.9%, with more than 9.6 million overnight stays by residents of the European Union, excluding Spain, and 902,429 from the rest of the world. In addition, the average recorded length of stay was 5.7 nights per traveler.

From January to July, overnight stays increased by 4% compared to the same period last year. In July, overnight stays in tourist apartments grew by 6%, primarily by residents (+ 9.3% as against the same month in 2014) as opposed to non-residents (+ 4.6%) and with an average stay of 6.9 nights per traveler (-1.4%). Furthermore, the occupancy rate was 53.3% on average, 6.2% more than the sixth month of the year before, 54.6% cases being on weekends (+ 4%).

9.2% increase in campsites

In July campsites recorded 9.2% more overnight stays, 9.8% more among residents and 8.5% more among non-residents, with an occupancy of 45% (+5.5), while in weekends figure rises to 48.2%, 4.2% more.

The rural tourism surged by 11.6% in the seventh month of the year with 12.2% more guests residents and 10.3% more of the non-residents. The occupancy rate was 24.8% (+ 11.4% compared to July 2014) with 35.9% on weekends (+ 4.5%).

Regarding hostels, a rise of 12.5%, 15.6% more in residents and a 2.3% increase in non-residents, with 45,4 % occupancy in July, i.e. a 10.5% drop compared to the same month last year. On weekends, the occupancy rate was 50.1% (-9.4%).

Prices rise by 3.6%

In addition, Holiday Dwelling Price Index (HDPI)  increased by 3.6% in July. The regular rate increased by 2.5% seizing 49.8% of the month’s total.

Next in growth is Tourist Campsite Price Index (TCPI), which rose by 1% during the seventh month of the year, with the normal rate (accounting for 45.6% of this type of accommodation) 1.5% above the figure of July 2014.

On the other hand, rural tourism recorded a slight decrease of 0.1%, with -0.3% in normal rate, which represents 55.6% of the total.

Original story: Expansión

Translation: Lee La