Foreign Property Investors Favoring Spain

Rock-bottom property prices and political unrest in comparable destination spots in North Africa are gaining additional international customers to Spain, according to one realtor inside the Murcia region. Property firm Mercers estimated a 25% year-on-year jump in sales in January and the 2013 sales regional record proves out the prognostication. Enquiries haven't improved, but experts say the importance of them have and more leads are resulting in sales. Meanwhile, Spain’s Economy Minister declared he thinks growth could return to the market as early as this year.

Sales momentum is building in many areas of Spain with one well established agency confirming transaction activity up 25% in the first three months of 2013 compared with a year ago.

In January, Murcia centered estate agent Mercers envisioned 25% increase in house sales for 2013 over 2012 and the numbers now back this up.‘I can’t determine the key reason why our sales are up a great deal, but momentum is certainly starting to build. It can’t be related to an end of year rush before VAT on new builds went up from 4% to 10% on 1 January, as all of our deals are actually resale's,’ said director Chris Mercer.

Furthermore, enquiries have not improved on the same level however those we have are certainly more significant, have the funds in place and are generally smart enough to know that the window of opportunity on a significant Spanish property bargain isn't going to be open forever,’ he stated. He added that looking over a slightly longer period business is up practically 65% in comparison with the very first quarter of 2011.

The Mercers trend is mirrored overall within the Murcia market. Figures from the National Institute of Statistics (INE) display sales of Murcian property were up 24.1% in February 2013 over the same month the previous year, with 1,169 dealings completed. This is above the national figure of 17.3%.

Agents consider that foreigners are definitely partly responsible for keeping the Spanish property market going. ‘Prices at the moment are very low and, in our area, we're looking at reductions of 40% to 55% from the peak. This is turning the heads of international buyers,’ said Mercer.

According to the Banco de España, 2012 showed the greatest amount of investment in Spanish property by international buyers in eight years, up 17% on 2011. This is during a period when requirement continues to be weak on the domestic front as Spain tackles high unemployment as well as an on-going reluctance to lend by financial institutions.

The figures reveal that foreign buyers spent €5.54 billion on Spanish property in 2012, up from €4.7 billion in 2011, as well as a 52% increase on the €3.6 million of 2009.
A break down from the figures indicate that property is increasingly becoming popular as overseas purchasers bought €1.8 million worth of property within the last quarter of the year, a 56% in on the same period in 2011 and up 92% in the final quarter of 2010.

For Mercers, Belgian, French, Norwegian, Swedish and more recently British buyers have ruled over the past year with some restored interest from Germans and Dutch.

The overall picture from Spain is probably more cheery than it has been for some time. The bad bank (SAREB) has revealed that it hopes to sell almost 42,500 housing units, around half its portfolio, over the next five years in order to help supply a ‘floor and launch a broad recovery in the Spanish housing industry.
‘Foreign demand has been rising as a result of lower Spanish property prices and political unrest in rival locations in North Africa, making Spain seem like a safe bet,’ said Mark Stucklin of Spanish Property Insight.

The official Spanish House Price Index from the Department of Housing fell by 10% in 2012, the 1st time since records began that Spanish property rates have gone down by double digits in nominal terms, according to the Department of Housing.
Meanwhile the Economy Minister, Luis de Guindos, was just lately quoted as proclaiming that growth could return to the country as quickly as the end of 2013.

A gorgeous home in good condition to provide a spacious lounge, dining area, kitchen fully fitted with white goods, two bedrooms with fitted wardrobes and a family bathroom. The home advantages from air conditioning, ceiling fans, fly screens and security grills. Stunning views of the mountains and countryside from the rooftop solarium.