Words: Ashley Rigg
Published: 16th January 2012
*The beginning of a Spanish property shortage?
With unemployment at record levels and property price falls accelerating in many areas, good news from Spain is thin on the ground.
Much has been made of Spain’s property glut but it seems that in the Costa del Sol at least, falling prices are beginning to clear the market.
According to the Association of Builders and Developers of Malaga (ACP) 10,000 new homes were sold in Malaga province in 2011 which is nearly half the 25,000 new homes on the market at the start of last year.
Could this be the start of shortage of property in established holiday home areas?
Ironically the answer is probably yes, although it may take some time.
Sales volumes are still significantly lower than their peak levels (partly because the
British have left such a big hole in demand) but new supply is likely to be subdued for a long period. Property markets work in long time lags and construction levels could take at least five years to return to “normal”.
In established destinations such a Marbella, where international demand is strong, 2012 could be the last year it’s possible to pick up real lifestyle bargains.
This conclusion however depends on your view on the future of the euro and the possibility of a major European-wide currency crisis.
Retirees and those yearning for early retirement or downshifting will continue to be the main market segments until there is a conclusion to the euro crisis.
Volumes won’t recover until then. The French and German elections are likely to be pivotal in the eventual revival of the Spanish overseas property market.
Source: Global edge
User Comments
This article is in no way a reflection the market at all, apart from the bit about Marbella and 2012.
There is definitely no shortage of property anywhere I've been.
Justin,
www.eyeonspain.com
I had to pinch myself.Is this December 28th or 1st April?
Like all the three initial posters, I have little faith in the "experts". I live here, I see the carnage in both the employment and unemployment market. There are exceptional bargains to be had, there are mortgages available but where are the buyers who have confidence?
Has the market bottomed? Maybe but who knows? Is there still another 20% to be sliced off? Maybe but who knows? Will the euro be re-valued? Maybe but who knows?
Until there is an element of confidence in the market, there will be no significant number of sales. In the meantime, "Come all ye faithful, joyful and triumphant". We have terrific offers, superb weather, a great lifestyle. Welcome and enjoy!
Steve Hall,
ThisIsSpain
Only 25,000 on the market? I have my doubts regarding that number. And who has bought these new homes? Some brave investors have bought whole urbanisations at deeply discounted prices and are having to complete or remodel them to bring them to acceptable standards. They are then offering the properties as individual units through slick experienced marketing, especially to Nordic countries, Germany and the like where the fall in the value of the Euro has made the properties relatively cheaper and/or the economy is still strong. Only when these units can be sold on by individuals who get their price and costs back at least will there then be proof of any change in the market.
Campbell D Ferguson,
Survey Spain SL
Official statistics in Spain, in my view, have to be taken with certain precaution given the way the statistics are created. As an agent on the Costa del Sol, I personally find this very surprising indeed that 10.000 new homes were sold in the province of Malaga last year. I would welcome other agent's points of view together with any other sources that may confirm, or deny this.
Robert Edwards,
Edwards Estates
Interesting comments but the Costa de Sol is not the Spanish property market. It is a part of it and only a part!.
The reality of the situation on the Costa Brava is that nearly the only buyers in the only100-150K ( pretty much the only movement) bracket are /were French. Now with all the good news from the rating agencies (who are these people?) last week should have undermined even further the confidence factor.
I am convinced that all these "experts" and their forecasts of doom & gloom are in fact responsible in part for the crisis in the property market here in Spain.
We have in place mortgages from 2.95 - 4.95% up to 100%..of valuation which begs the question, where are the buyers?.....they are not buying because they have no confidence in the immediate future and the doom & gloom merchants are saying that prices today will drop even more, up to some saying another 30%...God bless the experts eh?
geoff peters,
the property shop