There is no universal answer to the question as to whether it’s better to buy now or wait because you’ll just end up joining in with a game with many variables. Disappointed? What is certain is that the Madrid property market, just like that of Valencia and the Catalan and Basque regions, has its own peculiarities. It is not the same to do a property investment or buying in a town as in the capital, and within the capital, enormous differences exist between the offers that exist in the Salamanca district of Madrid property and that of Villaverde.
The property prices adjustment in course
The fact that the cost of housing continues to adjust month-to-month should not be overlooked, as it is for this very reason that the market is swamped with very attractive housing offers. You should analyse, in detail, the characteristics of the flat and place them in relation to the area in which the flat is located. These clues about the local market should help you in making the best decision.
Which districts or streets in Madrid do I look at if I want to buy a flat as an investment with revaluation expectations?
Madrid can count on certain districts which will always be in demand. It’s all about the more-established residential areas, specifically Salamanca, Chamberí, Charmartín, Retiro and certain parts of the city centre. You just have to look at the high level buildings which will best survive the test of time, just as Manuel Gandarias, director of the Office of Education at pisos.com indicates. “The location and condition of the building and home ownership are the two key factors.”
You may also obtain attractive returns from these districts within a short period of time, from the third of fifth year, whilst “if you propose a long-term investment, between 10 and 15 years, Tetuán and Usera have good prospects”, according to local property finders.
What three streets are at present the most expensive in the capital of Madrid?
Serrano, Velázquez and Castellana could be the trio of luxury property, but we must not lose sight of other streets either, such as Ortega and Gasset or Habana Avenue. The Salamanca district has always produced the most exaggerated prices, especially the quadrant between Alcalá, Príncipe de Vergara, Recoletos and Diego de León, closely followed by Chamberí with the area of Almagro, Alonso Martínez and Eduardo Dato.
What type of property is most in demand by buyers in the Community of Madrid?
Although not all potential buyers have the same needs, it is possible to imagine that standard housing prevails above everything else. For Isabel Gil, agent in Madrid, the most sought after flat measures at 100sqm, has 2/3 bedrooms, 2 bathrooms and, if possible, includes a parking space. We must also highlight the importance of a lift and common areas such as a swimming pool, gardens, gym and security, etc. The website, pisos.com, in its latest report on the most sought after housing in Spain, said that the most desired flat by its users is 90sqm and costs between €120,000 and €135,000.
What are the housing market expectations for 2013 in this region? Is this a good time to buy?
The price trend is still down, but they will become more and more temperate. In fact, in some areas, the discount rates recorded are minimal but they do show a slight upturn.
Buy with the view to do up the property with some small modifications which allow you to put the flat up for rent quickly. The profitability may be low at first but if you buy the property at a good price and you expect a long-term return from it, then it’s a good option.
What is the average time required to sell a flat in the Community of Madrid at the moment?
The average for selling is about eight months. Excluding the current severe mortgage situation and job instability, there are two reasons directly related to the seller that do not help in lowering this ratio: the refusal to lower the price and the reluctance to go to a brokerage agency. “It all depends on what the owner puts in the hands of the professional, who values your home properly,” states a Madrid property finder, estimating that a property priced correctly and with professional advice is sold in three to four months, and they even give cases where the transaction is complete within a month.
Another property finder is also of the same opinion, placing the sales price as the main accelerator and assuring that “you can sell in 10 days, especially if the house is in a price band lower than those offered in the same area.” These experts also point to the opposing side: “We have customers who have spent more than three years trying to sell their house, and because they won’t lower the price, they’ll never sell.”
By how much did prices reduce or increase last year in the capital of Madrid?
The last quarterly report on sales prices second-hand from pisos.com recorded a fall of -6.50% in Madrid in March 2013 in comparison to the same month last year. Consulted brokerage agencies raise this percentage to 10%. Do not forget that the prices at which properties are advertised on property websites are not the final prices, since they would be pending subsequent negotiation between the seller and buyer.
Is this region one of the areas most affected by the property crisis? Why?
Madrid has not been one of the most devastated regions by the ‘property boom’ crisis and less still if you focus on just the capital. It is true that there have been many urban developments on the outskirts of the capital and in neighbouring towns, accumulating an important stock, but in other communities, construction fever was higher. The worst affected area has been the coast.
What is the average price of a flat in Madrid? And in the centre of the capital?
According to the website pisos.com, the price of a typical flat consisting of 90sqm in the Community of Madrid would be around €210,000, whilst in the centre, we would be talking €270,000. Bear in mind that it is not the same for a flat in the district of Salamanca, where prices would move into the €400,000, and for Villaverde, where the average is around €143,000.
100sqm, in the centre of the capital Madrid, facing outside, three bedrooms and renovated.
The district centre is in fact wide in price. It is not the same in Lavapiés as Cibeles. Nevertheless, the range in price would be between €300,000 and €400,000.
100sqm, in a district well served by public transport, facing outside, three bedrooms and renovated.
Madrid has an extensive public transport network, which means that all its neighbourhoods rely on excellent access, so other variables need to be considered, since a flat in Villa de Vallecas is not the same as one in Sanchinarro or Las Tablas.
The price range would be between some €250,000 and €350,000, although if we head in to residential areas of a medium-high standard, these prices would reach up to €550,000.
200sqm in the centre of the capital of Madrid with green area(s) and new builds.
New building sites are not abundant in central areas of Madrid. The majority of developments have been built on appropriate plots where buildings have been demolished.
It is limited land and very exclusive, therefore the prices are very high, between €800,000 and €900,000, or even more if the housing development is luxurious.
Apartment of 45sqm inside, in the capital of Madrid, fifteen minutes by bus to the city centre. Depending on the district, it is possible to find attractive offers in price. For neighbourhoods close to the centre, prices are more modest and we would therefore expect prices between €120,000 and €125,000. If you wish to buy in a more typical area, prices would be between €250,000 and €300,000.
This article is an adaptation from elconfidencia.com
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