Spain's property sales bounce back from boom and bust
Fiona Govan · 9 Jun 2016, 13:34
Published: 09 Jun 2016 13:34 GMT+02:00
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Figures released by Spain’s National Institute (INE) on Thursday show that the Spanish housing market is well and truly making a comeback and has grown for the eighth consecutive quarter.
Re-sales rose by 6.4 percent on a year earlier, the statistics show, representing the strongest growth since the third quarter of 2007.
Meanwhile sales of new housing rose 6.1 percent during the first three months of this year compared to the same period of 2015.
After about a decade of booming activity, Spain's property sector collapsed at the end of 2007 amid rising interest rates, oversupply and tougher lending conditions.
The subsequent years saw banks struggling to offload a glut of unsold properties, while homeowners who had bought in the boom had little hope of re-selling without suffering a loss.
"To potential buyers wondering if now is the right time, I would say yes, definitely," Mark Stucklin, of Spanish Property Insight, told The Local.
"The best time to buy is when things are picking up and that is now. We have left the bottom behind us."
But is Spain on the cusp of another property boom?
"We don’t know how long recovery will last but it is likely to be a few years at least," he explained. "But there is little risk of a return to boom years, when the construction industry grew to monstrous proportions and twisted the Spanish economy out of shape."
The recovery has been fuelled by a surge in investment from foreign buyers.
Property sales to foreign buyers represented 17 percent of the entire market during 2015, according to recent figures of Spain’s industry ministry.
Property in the Balearics remains the most sought after with foreigners accounting for a whopping 39 percent of all sales on the islands last year.
The Canary Islands and Valencia region saw 37 percent and 34 percent of properties sold last year going to foreigners.
"We’re already seeing much more movement in the market during the first half of 2016," said Alexander Vaughn, co-founder of Lucas Fox, the international estate agents based in Barcelona.
"This is thanks to growing confidence among both local and overseas buyers, despite the political uncertainty in Spain and the prospect of Brexit "