Lucas Fox has released its market reports for the last two quarters of 2014, which show a steadying of prices across the board.
With unemployment falling, the economy growing faster than predicted and property reaching the bottom, 2015 is set to be a pivotal year for Spain’s property market. Prices are on average 40% below what they were since the start of the crisis in 2007 and we predict a slow and steady recovery. This is an opportune time to invest.
Alexander Vaughan, co-founder Lucas Fox
The report says that new international interest is impacting on demand for prime residential property. 2015 is expected to be the most significant year of recovery for the prime market in Barcelona since 2007.
Lucas Fox sales data shows that Middle Eastern buyers accounted for 12.5% of all purchases during 2014, followed by the Spanish and French both at 11%, the Germans at 8% and the British at 7%.
The bulk of prime market property purchases in Barcelona during 2014 was for investment use with two out of five buying for that reason, whereas in 2013, the main reason for buying was for use as a primary or secondary residence.
The number of transactions in 2014 increased over 2013, with more properties above €1 million selling than in the previous year.
In the Costa Brava, foreign investment in residential property has grown significantly. In 2010, foreign investment in new housing properties accounted for 9% of the market. In 2014, foreign investment represented 26% of the market.
Price movement in the prime residential property market for the Costa Brava region is not expected in 2015. However, sales volume is predicted to increase particularly in the coastal areas around Begur, including Aiguablava, Tamariu, Calella and Llafranc, traditionally a very popular area for mid to high end British and Northern European buyers.
Along with slight price increases, Ibiza saw a 10% increase in prime market property buyer interest, a trend that is expected to continue in 2015 and it has seen foreign investment in residential property grow steadily. In 2010, foreign investment in new housing properties accounted for 18% of the market. In 2014, foreign investment represented 32% of the market.
Sales in the Balearic Islands, which includes Ibiza, have shown a more robust incremental increase in sales activity for the past year than is evident in the Spanish overall property market.
The Marbella residential property has also seen strong growth in foreign property ownership. In 2010, foreign investment in new housing properties accounted for 12% of the market. In 2014, foreign investment represented 35% of the market.
Amongst foreign buyers resident in Spain, transaction value of purchases made across the Málaga region, which includes Marbella, increased for each quarter in 2014 over 2013 levels.
It is expected that during 2015 prices across the market in Valencia will remain stable as they have done over the last six months. In the most discerning areas of the city, a slight rise of prices ranging between 1% and 3%, is expected.
Although the number of sales transactions of second hand properties in Valencia has dropped significantly since 2007, sales trading has seen increases each year since 2012 with a 31% increase in the number of sales of re-sale properties trading in 2014 over 2013 levels.
The reports also suggest that 2014 was a year of stability and growth for the property market in Madrid, with prices expected to have bottomed out. Total sales value of transactions in the first three quarters of 2014 was higher than the corresponding quarters of 2013.
Madrid city centre saw some price corrections in the third quarter of 2013, and has since steadied in price, maintaining an average price of €3,285 per square metre by the end of 2014. The affluent districts of Chamberí and Salamanca both saw slight price increases over the levels recorded at the end of 2013, at €3,260 per square metre and €4,138 respectively.
Last year was one of stability and growth for the property market in Madrid. Following several years of crisis and an important price correction, positive economic indicators brought renewed interest from international investors.
Rod Jamieson, Director Lucas Fox Madrid
The reports also contain data for the Maresme Coast, the region just north of Barcelona and Sitges, to the south.