Residential property sales volume and value increased in Spain in first half of 2017

The volume and value of property sales in Spain increased substantially in the first six months of 2017 with an increase in domestic buyers, new research shows.

The number of transactions increased by 47% and the value of these sales was up by 55%, according to the latest report from Lucas Fox with sales to British buyers at 10%, slightly down compared to last year.

The firm also reports that 10% of sales were to buyers from the United States or Canada while overall 32% of all Lucas Fox buyers bought as an investment and the same proportion purchased homes as a secondary residence and 23% of buyers bought homes as a primary residence.

The average price of a property sold by Lucas Fox in the first six months of 2017 was €750,000 and the country’s top three cities, Madrid, Barcelona and Valencia recorded a successful six months.

‘Spain’s economy is the fastest growing in the Eurozone, bringing greater confidence back the property market. We have seen growing interest from property investors, who now regard Spanish real estate as offering excellent potential for capital gains and profitability through short and long term rentals. We expect that the price recovery now taking place in the cities will extend to the suburbs and other parts of the country in the forthcoming months,’ said co-founder Alexander Vaughan.

In Barcelona sales increased by 42% and the value of sales was up by 31% with 43% buying as an investment. New build properties were the most popular and by the end of 2017 are forecast to account for at least 50% of transactions.

There has been a significant demand from Northern European and US buyers for both renting and buying homes in Barcelona. Indeed rentals increased by 150% year on year with the average rent priced at €2,721.

‘Renovated apartments located in Modernista buildings situated in Eixample are as always in high demand, although other areas in the Old Town are becoming more and more sought-after,’ said Rod Jamieson of Lucas Fox Barcelona and Madrid.

‘Driving this demand is the development of luxury new build projects and the transformation of these areas with the opening of new trendy bars, restaurants and shops. Barcelona is also attracting increasing numbers of wealthy international people wishing to settle in the city thanks to its exceptional quality of life. The number of transactions at the top end of the market has grown consistently during the year and prime properties in the uptown area near international schools are being snapped up,’ he explained.

The number of sales in Sitges increased by 175% with 18% of buyers from Spain and 27% from the UK. Some 55% bought a property as a secondary residence while in Maresme sales increased by 59% with 80% for a main residence.

‘Prices in Sitges have increased over recent years but are still significantly behind the peak of 2007. Where property prices in Barcelona are fast catching up with those of 10 years ago, here the pace is slower, offering good opportunities for investors who want to see healthy returns,’ said Rachel Haslam, director of Lucas Fox Sitges.

Both the volume and value of Lucas Fox Madrid sales increased in the first half of 2017, up by 30% and 170% respectively and 62% of sales were for investment properties with 46% of them to national buyers while Latin American buyers accounted for 31% of all Madrid sales

According to Rod Jamieson of Lucas Fox Barcelona and Madrid increasing numbers of international buyers are choosing the Spanish capital as the best option in which to invest their money due to good potential for capital gains in the mid to long term excellent rental return.

The most sought-after locations in the city continue to be the neighbourhoods of Salamanca, Chamberí and Justicia. ‘There remains a shortage of quality properties available on the market in these key central locations of the city but we expect the availability of turnkey homes to increase during the second half of the year,’ he added.

In Valencia sales increased by 156% over the first six months of the year with 43% bought as a main home and the remainder split more or less equally between investment and second home. Some 65% of buyers were Spanish and rental transactions increased by 63% year on year with the average rental home priced at €2,423.

‘We have seen a noticeable growth in the number of national enquiries in the first half of 2017 and around 50% of our clients are international. There have also been more investors around, thanks to the city’s attractive property prices, good rental yields and, of course, Valencia’s fantastic quality of life,’ said Juan Luis Herrero of Lucas Fox Valencia.

Sales were also up in Marbella, the Costa Brava and Ibiza. The Marbella office saw an increase of 150% with sales to Scandinavian buyers accounting for 80% while in the Costa Brava half of sales were to national buyers. However, demand from Russians and Ukranians is increasing on the Costa Brava.

In Ibiza there is a different buying pattern and all sales were bought by buyers wanting a second home with demand from German and French buyers up on Ibiza, whilst British demand was down.

‘Demand for coastal properties has remained consistent and there have also been signs of an increase in sales at the prime end of the market. The southern coastal areas of Blanes, Lloret de Mar and Tossa de Mar have also begun to see the return of interest from high end Russian, Ukranian and Kazakh clients,’ said Tom Maidment, of Lucas Fox Maresme and Costa Brava. .

‘Both national and international buyers are returning in numbers to the rustic market and the demand for both rustic townhouses in prime areas of the Empordà and larger country houses throughout the Empordà and elsewhere in Girona has risen significantly. This is perhaps the standout trend in the first half of 2017,’ he added.