After a turbulent few years in the eye of the euro zone storm, Spain seems to be making a turnaround at last. The economy is showing signs of recovery, tourist numbers are up, and after years of plummeting house prices, experts are predicting increases in 2015, with prices in some areas rising already.
According to figures from Currencies Direct, sales have soared by 56 per cent this year, compared with 2011, and have increased by 25 per cent since last year. A lot of this growth has been fuelled by British buyers whose budgets have been boosted by the stronger pound, together with low interest rates which are still pushing people to invest in property rather than traditional savings. The recent house price surge in the UK housing market has also encouraged people in retirement to sell up and release equity to buy in Spain.
According to Currencies Direct, the average Spanish property is prices at around nine per cent below 2011 levels and around five to six per cent down on last year’s prices, but industry experts do not expect prices to fall any further, and these bargain prices won’t last forever, so it’s a good time to tap into the market.
And it appears that there are plenty people already doing so. The number of homes sold in Spain increased by 12.1 per cent in the second quarter of this year compared with 2013, boosted by the increasing number of foreign buyers. According to the Ministry of Public Works, 16.4 per cent of total sales were to foreign buyers, with notaries describing them as the “principal motor of growth” for the Spanish property market. The British are still the biggest group of foreign buyers but they no longer dominate as they did in the boom, according to Spanish Property Insight. The market today is much more diversified, which is positive news for Spain.
And the growing presence of US, Russian and Chinese buyers is a sign that the Golden Investment Visa initiative, which was introduced in September 2013 and offers residency permits to non-EU nationals in return for an investment of €500,000 or more in Spanish property, may be starting to have an effect.
A recent Overseas Guides Company reader’s survey showed that Spain is still by far the most popular country for those considering buying property abroad and with those readers who already have a second property. The country generated 2,710 enquiries in the third quarter of this year, compared with 2,494 enquiries in the third quarter of 2013. And the story is similar at Conti, where Spain accounted for more than half (51 per cent) of enquiries received over January to September. The volume of enquiries for Spain has, in fact, increased by a massive 95 per cent when compared with 2013.
It’s a great time to buy property in Spain, but it’s also vitally important to seek the right advice. Bitter experience has taught many investors that scrimping on independent legal advice can effectively cost them their holiday home. They should always go through the same process that they would follow if they were buying a property in the UK. This includes taking independent advice from an English-speaking lawyer who is not connected to their seller, estate agent or property developer.