The Spanish property market grew by 14% in 2016, the biggest increase in sales of homes since the run up to the last real estate boom, new figures show.
The data from the National Institute of Statistics show there were 362,182 home sales recorded on the Spanish property register in 2016, up 14% year on year and 7% month on month.
Mark Stucklin, of Spanish Property Insight, pointed out that the market has now expanded for the last three years after bottoming out in 2013 and seen two years in a row of double digit annual growth.
However, despite the recent improvement in sales, the market is still 50% smaller by volume than it was in the peak year of 2007. He reckons that a level somewhere between the two would be normal for a country the size of Spain.
He also pointed out that it was a relatively good year for new home sales, which only declined 3% in the year. ‘That was a huge improvement after almost a decade of double-digit declines. Last year was the year that new home sales declines petered out. I expect new home sales will increase next year for the first time in more than a decade,’ Stucklin said.
A breakdown of the figures shows that sales increased the most in the Balearics with a rise 31% but rose by just 5% in Malaga and Murcia, well below the national average. ‘That is probably due to Brexit depressing British demand in those regions, where British buyers have long been the biggest foreign market,’ Stucklin explained.
Sales were also strong in Barcelona with growth of 24% and Stucklin believes that this was driven in part by strong international demand from an increasingly diversified global market led by the Chinese.
‘There is a real and sustained recovery in home sales, albeit from a low base, although some areas are doing much better than others. There is also room for more growth, as the market is still smaller than it should be considering the population size and housing stock,’ Stucklin said.
‘Small investors are moving out of cash and deposits and into property, and this trend will probably continue in 2017. So 2016 was a year of positive news for the market in terms of sales, and 2017 should be more of the same assuming no nasty shocks. However, there are plenty of potential nasty shocks lurking around the world today,’ he added.