Spanish property prices rose to absurd levels during the Spanish property boom, which came to a dramatic fall in 2007. Since then Spain has suffered a severe economic crisis, which has further damaged property values, with the result that property prices in many areas are still similar to those recorded in 2004. The house prices have dropped by as much as 35%-50% since the boom and now offer exceptional value for money.
But prices vary wildly between different areas of Spain and the market recovery that began in 2012/13 is certainly not everywhere. Over-supply issues were never such a big issue in Mallorca and Ibiza so prices have begun to rise again already. Spain’s National Institute of Statistics, called INE, has reported that the Spanish market has grown every month since March 2014, with sales going up steadily, year on year. The Balearics and Almeria show the biggest year-on-year increases over 2017.
Ever popular Marbella arguably led the recovery on the Costas. In 2014 the Costa Blanca market, especially the new-build sector, came back into action. The INE has also revealed that 40 percent of foreign buyers in Spain was in the Alicante region, including the Costa Blanca. Post-Brexit vote, British buyers have dipped a little but still lead the way. Many nationalities that include non-EU investors seeking “golden visas” as well as a good range of northern Europeans are seeking to escape freezing winters. Many buyers may still find some great deals, not to say the market is completely rosy, far from it. Properties in less popular or marginal locations are still struggling to sell, along with desirable properties in areas such as Menorca where supply outweighs demand.
The real market recovery won’t gather momentum until the domestic sector bounces back, and there are now reports of Spanish retirees joining the overseas bargain hunters on the Costas, so these are positive signs. Mortgage options have increased during 2017 but cash is still king amongst the lower priced properties. Whether you are seeking something new or old, it’s clearly a great time to buy in Spain, before price rises really get the momentum.
Rarely these days is it a spontaneous decision, rather the result of several months of careful research and watching the market.
Such research may have included visiting a property show to pick up advice and ideas, as well as surfing the internet.
Websites provide good information but rarely show the reality of an area, both in and out of season, so finding trips are vital. It’s amazing how many people state that they “thought” they wanted to be in one place, yet they ended up changing their mind during their search process.
After all, you need not only to get to know the region, how relevant is climate, but then the area, and maybe a short list of villages or resorts, down to the right part of a town for you.
From my experience, I learned, that you really need to see and feel any property you are going to buy and view both the quality and the location. Also, there is no shortcut to buying property in Spain and an essential part of your research should always involve staying for a while where you think you want to buy.