Published 19/04/2018 by Carrie Frais

Lucas Fox Spanish Real Estate Market Analysis Q1 2018

Q1 2018 highlights: transactions soar in desirable coastal resorts; foreigners dominate sales; average price of sale up by 18%.

The Spanish property market has continued to grow at the start of 2018 with almost 90,000 properties exchanging hands in the first two months of the year, according to the National Institute of Statistics, an increase of 20% over the same period in 2017. The number of new homes in the first two months of 2018 showed a similar growth, with almost 16,000 new homes being sold across Spain.

The average price of a property sold by Lucas Fox in the first quarter of 2018 increased by 18%, averaging at €924,000, confirming that the Spanish prime property market is recovering well. Due to the Catalan political situation, the number of sales transactions completed by Lucas Fox in the first quarter of 2018 decreased slightly compared to the same period in 2017 but the total value of sales transactions showed an increase of 5%. The rhythm of sales has now returned to pre October levels and it is expected that Lucas Fox’s half yearly results will once again show steady growth.

According to official data, in 2017 just over 61,000 homes were sold to foreigners, representing just over 13% of total sales, a figure not far off the peak of 2007 when around 65,300 homes were sold to foreigners, then representing 8.3% of the market.

Lucas Fox’s sales in the first quarter of 2018 were dominated by foreigners who accounted for 77% of sales, the majority coming from the United Kingdom, France, Scandinavia and the United States.

Just over a third of all Lucas Fox buyers purchased property as a primary residence with a similar share buying as a secondary residence. The remainder mainly bought for investment purposes.

Leading property portal Idealista showed that property prices have continued to increase year-on-year, recording an annual increase of just over 7% at the end of the first quarter of 2018, the second highest level since the start of the recovery.

Madrid

Lucas Fox Madrid

The number of sales by Lucas Fox Madrid was exactly the same in the first quarter of 2018 as in the first quarter of 2017. However, the average property price decreased slightly, by 11% compared to the same period in 2017, from €650,000 to €577,000.
National buyers accounted for 50% of all Lucas Fox Madrid sales in the first quarter of 2018.
Half of all Lucas Fox Madrid buyers in the first quarter of 2018 purchased property as a primary residence and 25% bought for investment purposes.
Spanish interest in Madrid properties represented just over 60% of Lucas Fox website visitors in the first quarter of 2018, slightly more than in Q1 2017 when 54% of website visitors came from Spain. Amongst international buyers the majority of interest continues to come from the United States (9%) and the United Kingdom (8%).
According to official figures the number of sales transactions in the Community of Madrid in the first two months of 2018 increased by 14% over the same period in 2017, averaging 6,332 sales per month. (INE)
The number of sales of new homes in the Community of Madrid in the first two months of 2018 increased by 17% over the same period in 2017, with sales of new homes making up 21% and 22% of the total sales in the first two months of 2017 and 2018 respectively. (INE)
Average property prices in Madrid city showed an annual increase of 21% at the end of the first quarter of 2018, with prices in the centre rising by 22%. The sought-after districts of Chamartín, Chamberí and Salamanca showed increases of 17%, 17% and 19% respectively. (Idealista)

Valencia

The number of sales transactions completed by Lucas Fox Valencia in the first quarter of 2018 increased by 17% compared to the same period in 2017, with an average property price of €516,000. The total value of sales transactions in the first quarter of 2018 showed an increase of 13% over the same period in 2017.
National buyers accounted for nearly 60% of all Lucas Fox Valencia sales in the first quarter of 2018, with the majority of the remaining buyers coming from Europe.
Almost 30% of Lucas Fox Valencia buyers in the first quarter of 2018 purchased property as a main home with the same share buying as a secondary residence. The remainder mainly bought for either investment or relocation purposes.
The number of rental transactions completed by Lucas Fox Valencia in the first quarter of 2018 more than doubled compared to the same period in 2017.
The national market continues to dominate in Valencia, with almost 60% of Lucas Fox website visitors looking at Valencia properties in the first quarter of 2018 coming from Spain, a similar share to Q1 2017. Amongst international buyers the majority of interest continues to come from the United Kingdom (8%) and the United States (7%).
According to official figures, the number of sales transactions in Valencia in the first two months of 2018 increased by 26% over the same period in 2017, averaging 2,590 sales per month. (INE)
Average property prices in Valencia city showed an annual increase of 13% at the end of the first quarter of 2018, with prices in the sought-after districts of the Old Town, Eixample and El Pla del Real increasing by 7%, 10% and 13% respectively. (Idealista)

Barcelona

Lucas Fox Barcelona

The political situation in Catalonia had a noticeable effect on Lucas Fox’s sales in Barcelona in Q1 2018. The number of sales transactions decreased by 55% compared to the same period in 2017. The total value of sales transactions in the first quarter of 2018 decreased by 39% compared to the same period in 2017. However the property price averaged at €917,278 in the first quarter of 2018, an increase of 36% on the average property price in the first quarter of 2017.
National buyers accounted for 28% of all Lucas Fox Barcelona sales in the first quarter of 2018, US buyers accounted for 22% of all sales and UK buyers 11%. The remaining buyers were mainly from other European countries.
The majority of Lucas Fox Barcelona buyers purchased property for either a primary residence (39%) or investment purposes (39%). 11% bought as a secondary residence.
The number of rental transactions completed by Lucas Fox Barcelona in the first quarter of 2018 increased by 23% compared to the same period in 2017, with the price averaging at €2,324 per month, up 7% on the average price in the same period in 2017.
Just over half of Lucas Fox website visitors looking at Barcelona properties came from Spanish residents in the first quarter of 2018, up slightly from the same period in 2017. Buyers from both the United Kingdom (9%) and the United States (7%) continue to regularly review Barcelona properties on the website.
According to official figures the number of sales transactions in Barcelona in the first two months of 2018 increased by 8% over the same period in 2017, averaging 4,785 sales per month. (INE)
The number of sales of new homes in Barcelona in the first two months of 2018 increased by 48% over the same period in 2017, with sales of new homes making up 12% and 16% of the total sales in the first two months of 2017 and 2018 respectively. (INE)
Average property prices in Barcelona city showed an annual increase of 5% at the end of the first quarter of 2018. (Idealista)

Maresme

Lucas Fox Maresme

National buyers accounted for a third of all Lucas Fox Maresme sales in the first quarter of 2018, with the remaining buyers coming from other European countries.
Two thirds of Lucas Fox Maresme buyers in the first quarter of 2018 purchased property as a primary residence with the reminder buying as a secondary residence.
In the first quarter of 2018 the majority of interest in Maresme properties on the Lucas Fox website was national, with 57% of visitors coming from Spain, showing a similar trend to the first quarter of 2017 when 55% of website visitors came from Spain. Amongst international buyers the majority came from the United Kingdom (8%) and the United States (4%).
The number of sales transactions in the Maresme region in 2017 increased by 19% over the number of sales in 2016. (Generalitat de Catalunya)
Average property prices in the Maresme region showed an annual increase of 8% at the end of 2017, with average prices in the areas of Cabrils, Alella, Premià de Dalt, Tiana, Sant Andreu de Llavaneres, Teià and Sant Vicenç de Montalt increasing by 52%, 40%, 28%, 24% 11%, 10% and 9% respectively. (Generalitat de Catalunya)

Sitges

The number of sales transactions completed by Lucas Fox Sitges in the first quarter of 2018 increased by 17% compared to the first quarter of 2017, with an average price of almost €1.5 million. The total value of sales transactions in the first quarter of 2018 showed an increase of 5% over the same period in 2017.
Foreign buyers accounted for all Lucas Fox Sitges sales in the first quarter of 2018, with the majority coming from the United Kingdom.
Over half of all Lucas Fox Sitges buyers in the first quarter of 2018 purchased property as a secondary residence, with 43% buying as a primary residence.
Although foreign buyers accounted for all Lucas Fox Sitges sales in the first quarter of 2018, national buyers continue to view Sitges properties on the Lucas Fox website with 41% of interest coming from Spain. Amongst international buyers the number of British visitors to the Lucas Fox website looking for property in Sitges continues to dominate, with 19% of all visitors coming from the United Kingdom.
Average property prices in Sitges showed a very slight decrease at the end of the first quarter of 2018, with average prices down 2% on the average price at the end of the first quarter of 2017. Average property prices in the neighbouring areas of Castelldefels and Gavà, however, showed increases of 9% and 5% respectively. (Idealista)

Costa Brava & Girona

Lucas Fox Costa Brava had an excellent start to the year with both the number and total value of sales transactions completed in the first quarter of 2018 more than quadrupling compared to the same period in 2017.
International buyers accounted for all Lucas Fox Costa Brava sales in the first quarter of 2018 with 50% coming from the United Kingdom.
Over half of all Lucas Fox Costa Brava buyers in the first quarter of 2018 purchased property as a secondary residence, with the remainder buying as either a primary residence or for investment purposes.
37% of Lucas Fox website visitors looking at Costa Brava properties originated from Spain in the first quarter of 2018, a similar figure to the first quarter of 2017. The majority of international interest in Costa Brava properties came from the United Kingdom (17%), France (9%) and the United States (6%).
According to official figures the number of sales transactions in Girona in the first two months of 2018 increased by 8% over the same period in 2017, averaging 934 sales per month. (INE)
Average property prices in Girona showed an annual increase of 6% at the end of the first quarter of 2018. In the sought-after area of Palamós average prices increased by 5% and average prices in Girona city itself increased by 9%. (Idealista)

Marbella-Costa del Sol

Lucas Fox Marbella

Lucas Fox Marbella had an excellent start to the year with an average property price of just under €1.5 million.
Foreign buyers accounted for all Lucas Fox Marbella sales in the first quarter of 2018, with a third coming from the United Kingdom and a third coming from Scandinavia.
All Lucas Fox Marbella buyers in the first quarter of 2018 purchased property as a secondary residence.
Although foreign buyers accounted for all Lucas Fox Marbella sales in the first quarter of 2018, national interest in Marbella properties is still high with 41% of buyers looking for properties in Marbella coming from Spain. Amongst international buyers the majority of interest in properties in Marbella continues to come from the United Kingdom (12%) followed by Sweden (7%).
According to official figures the number of sales transactions in Málaga in the first two months of 2018 increased by 17% over the same period in 2017, averaging 2,801 sales per month. (INE)
Average property prices in Málaga showed an annual increase of 12% at the end of the first quarter of 2018, with prices in Benahavís, Estepona and Marbella increasing by 10%, 13% and 11% respectively. (Idealista)

Ibiza

Lucas Fox Ibiza had a good start to the year with the number of sales transactions completed in the first quarter of 2018 tripling compared to the same period in 2017.
Foreign buyers accounted for all Lucas Fox Ibiza sales in the first quarter of 2018, with the majority coming from European countries.
All Lucas Fox Ibiza buyers in the first quarter of 2018 purchased property as a secondary residence.
Although foreign buyers accounted for all Lucas Fox Ibiza sales in the first quarter of 2018, national interest is still high with 34% of buyers looking for property in Ibiza coming from Spain. Amongst international buyers interest from the United Kingdom was high (20%), followed by France (7%), the Netherlands (7%) and the United States (6%).
According to official figures the number of sales transactions in the Balearic Islands in the first two months of 2018 increased by 18% over the same period in 2017, averaging 1,455 sales per month. (INE)
Average property prices across the Balearic Islands showed an annual increase of 27% at the end of the first quarter of 2018, with prices in Ibiza Old Town, Sant Josep de sa Talaia and Santa Eulària des Riu increasing by 21%, 21% and 18% respectively. (Idealista)

Here are the thoughts of Lucas Fox co-founder Alexander Vaughan on why investing in Spanish property during 2018 is a safe bet: