The Spanish property market is sailing towards a year modelled on stability and sustainability, according to recent figures. The market is expected to not only consolidate the astounding gains of recent years, but see further growth in demand and house prices in prime regions throughout the country.
The glut of homes built in Spain during the boom housing years prior to the crash in 2007 decreased by 20% in 2016. According to ServiHabitat, a real estate services firm that forms part of the Caix Bank Group, the figure has fallen to 388,000 homes and is set to fall another 20% in 2017 to around 315,000, well down on the 650,000 peak of 2009.
The report found national average house prices to have increased by 4.6% in 2016, forecasting a further rise of 4.3% in 2017. Again, rising prices will not be universal across Spain, with the biggest growth likely to be found in Madrid, Barcelona and locations popular with overseas buyers such as the Balearics and Andalucía.
International buyers accounted for over 20 per cent of all Spanish property transactions in 2016, and the trend is likely to continue into 2017. While fewer British buyers are expected due to the onset of Brexit over the coming months, Spain has always been popular with European buyers and has also attracted new investors through the golden visa scheme.
Introduced in 2013, the scheme grants permanent residency for an investment of 500,000 euros or more in Spanish real estate. Total foreign investment through the scheme now accounts for 1.71 billion euros as of October 2016. Recent data also shows that Chinese buyers have invested a total of 469 million euros in Spanish real estate, up by 75% compared to the end of 2015. Russians invested 480 million euros, up by 46% compared to the year before.
While Madrid was most popular with Chinese buyers, Russian investors are concentrated on Barcelona and coastal locations such as the Costa del Sol, Costa Blanca and Costa Brava.
The overall sentiment within the Spanish property market is positive for anyone interested investing in a property in Spain. Especially as the market continues to adapt and become more dynamic, transparent and open to foreign citizens.