2015: The Year in Spanish Property

2016-02-10 08:00:00

2015: The Year in Spanish Property


While the Spanish property sector began to take a positive turn at the end of 2014 following a crippling financial crisis that began in 2007, 2015 became the year of a consolidated recovery, with 12 consecutive months of positive increases and improvements across the board.


The economic recovery of Spain in general last year assisted in spearheading improvements in the property sector, including boosted levels of employment, a booming tourism industry and a progressive return of the financing capabilities of banking institutions across the country. These variables greatly led to an increase in consumer confidence at home and abroad, encouraging people to cast their eyes once again towards Spain;  its ever-appealing weather, culture and laid-back lifestyle, as well as a lucrative opportunity to invest in post-crisis, de-valued, bargain properties and bank repossessions.


Increased levels of investor demand in prime areas across Spain in 2015 has significantly aided house prices and reignited activity in many of the most sought after regions such as Barcelona, Madrid, the Balearics and the Costa del Sol. The trend however, has yet to reach other Spanish regions that are less popular with foreign buyers, though other major cities are expected to experience a revival and catch up over the course of 2016.


2015 also marked the beginning of a new era of property developers returning to the Spanish market for the first time since the economic crash. Among others, The Platinum Estates Group, an investment fund based in Hong Kong, recently acquired 170,000 square meters of land on the coastal road of Las Chapas (near Elviria), and is currently finalising plans to build the most luxurious beach resort in the country, including a five-star luxury hotel and 120 new villas. New developments and surges in investments in these types of areas have and will continue to push property prices up as demand and activity increases.


As a result of a surge in foreign investor demand in 2015, the construction sector also experienced an uptick in activity for the first time since before the economic crisis began. Building permits for new homes alone rose by 29.2% according to Spain’s Ministry of Works, while the number of building licenses authorised for the reform or restoration of homes in Spain between January and October 2015 represented an increase of 13% compared to the same period of the previous year.


Overall, the main variables that measure the health of the property sector - prices, transactions, granted mortgages and number of building permits - have all concluded the year on a positive note, with increases without exception, and a forecasted trajectory of stability and further growth in 2016.source Martina Fritsche - martina@domusvenari.com