The year 2013 confirmed the purchasing power of overseas buyers in the Spanish property market, which increased 23% and 25% in Q2/2013 and Q3/2013 compared with the same quarters in 2012. Also, 2013 prices have continued dropping since 2007, but at a lower pace than in 2012.
These are our 2014 predictions for the Spanish Property market:
- Prices will keep dropping. It is definitely a general view that prices will continue going toward rock-bottom, at least in the first half of 2014. We have already seen property prices adjusting rapidly in the last quarter of 2013, and we can predict that Q1/2014 will experience a general property pricing fall.
- Bargains will go quicker: We have estimated, after searching for properties for clients in the last quarter, that “bargains “ stay on the market for a period of 2 weeks once they are priced right. We have seen in Q4/2013 how properties that were reaching the right price left the market in as quickly as 2 weeks from the last price adjustment after being in the market for several months (in some cases for 18 and even 24 months with permanent asking price adjustments)
- UK buyers will keep being number one in the ranks of overseas buyers. Brits buy the most properties in Spain: in 2012, they comprised 14.90% of the total of transactions done by overseas buyers. Regarding 2013, the figures show that during Q2/2013, the growth of transactions made by Brits was 24.6% higher than in the same period in 2012. In 2014, we expect more UK buyers coming to Spain, according not only to the growth of inquiries that The Spanish Brick has been experiencing but also to the growth of Spanish property searches that the main portals have reported. It is also due to the growth of interest in Spain that UK events such as the show “A Place in The Sun” have caused in the last year compared with 2012. Brits will buy more in Spain in 2014.
- More new agents in the market. There is an unavoidable consequence from the second “Spanish property boom” that not many people know about: The increase of independent agents that have set up business in the last two years, given the lack of jobs and the emergence of the property market. Many independent agents have created a portfolio of properties and low cost websites that are already ranking.
- More risky properties exposed. Another fact is that more risky properties will be exposed to potential buyers by bank repossessions and agents. 2014 could be the year in which more overseas buyers get trapped in Spain, being attracted by cheap properties or potential bargains that do not have all legal paperwork complete. This is more problematic. Low budget buyers (below €100k) are the profile of “new victims.”
- The rise of property finder services. The Spanish property market is back to the wave of the property boom It is important to highlight that customized property finder services will be the solution for buyers and investors that cannot handle hundreds of Spanish properties on the internet, do not speak the language, and do not want to risk being trapped by a “toxic” property.
- More variety of offers … the rise of rural locations. The crisis in Spain has led estate agents and vendors in rural areas and locations in northern Spain (far away from the classic destinations of the Mediterranean coasts) to search for clients abroad. That is why we can see more specialised estate agents in local rural areas in Spain that five years ago did not exist. Asturias, Cantabria and Galicia are growing markets. These provinces also deliver excellent lifestyle and great value options for families looking for good houses.
OUR ADVICE: Now more than ever, Spain has the opportunity to deliver the house and investment that you are looking for to you. Good opportunities go quickly. But please, get the right advice and support to avoid unexpected traps. They are more present than ever before. If you get trapped, it may be your fault for being foolish.
For more information about the Spanish market in 2014, contact us!