Property sales and prices in Spain forecast to continue growth in 2018
Property sales and prices in Spain are forecast to rise in 2018 as long as there are no sudden economic surprises or changes to the mortgage market.
Anticipa, one of Spain’s biggest real estate providers, expects sales to rise 9.3% next year to 526,000 units, up from 481,000 this year and 21% more than in 2016. It is also forecasting that prices will have risen by 6.9% by the end of 2017 and looking ahead to 2018 are set to rise by slightly less at 6.1%. Even with this rise they will still be 27% below the peak of the market in 2007.
Prices for resales and new builds are expected to continue to increase by 5.8% over the fourth quarter of this year, the firm says in its latest real estate market report, but this was compiled before Catalonia declared independence and the national Government took over the running of the region.
Mark Stucklin of Spanish Property Insight, pointed out that the company’s forecast for 2018 is 85% higher than the nadir of 2013 when just 285,000 homes were sold in Spain. But as the report shows the market is still 42% below its peak of over 900,000 sales in 2006.
Building completions on new homes in Spain will also be well below their peak reached in the boom years. The report expects a total of 63,400 in 2019, compared to 62,900 in 2017.
Stucklin explained that although these figures do show a significant increase of over 48% in relation to the low of 2016 when 42,700 completed properties, volume still lies 90% below its peak.
Forecasts could be affected by what happens in Catalonia regarding the region’s bid for independent from Spain. The region is regarded as the wealthiest in Spain and its capital Barcelona has seen some of the highest property price rises this year.
With the Madrid Government having now taken over control of the regional government ahead of elections in December there is now a state of wait and see. Spain’s third largest bank Caixa Bank has already moved its registered office out of Catalonia and is likely to wait until after the regional election to announce what the future holds.
In Spain large property companies with a lot of exposure in Catalonia have seen their share prices slump. Merlin Properties and Colonial fell by 5.3% and 6.4% respectively at the height of the independence crisis.