2019 has proved to be another year of positive growth for leading real estate agency Lucas Fox, Savills residential associate in Spain.
The company’s latest Market Reports show that the number of sales rose by 48% across the group, including a 78% increase in transactions in Barcelona. 32% of all Lucas Fox sales were for new homes. The total value of sales across the group in 2019 also went up significantly – by 57% – when compared to 2018.
The average price of a property sold by the company increased from €869,417 to €923,256, a rise of 6%.
Seven new offices that were launched in 2018 (Alicante, Andorra, Málaga, Menorca, Tarragona, Vigo and Vilanova i la Geltrú) saw their combined sales triple year-on-year. Four new offices (Girona, Platja d’Aro, Pozuelo and Sant Cugat del Vallès) opened in the last twelve months and another fifteen are set to open in 2020.
Looking at the buyer profile, 58% were from outside Spain, down from 66% in 2018. Buyer motivation continues to be split fairly evenly between purchasing as a primary residence (33%), a second home (30%) and as an investment property (30%) with 6% buying to obtain the Golden Visa.
Prime and new homes sales continue to be buoyant
Sales of prime homes (valued over €900,000) rose by 30% across the group, with an average price of just over €2 million, an increase of 21% when compared to the average prime property sold in 2018. The areas that registered the greatest increases in prime sales were in Barcelona (50% increase), Madrid (30% increase) and the Catalan coastal town of Sitges where there was a 33% increase in prime sales. 60% of buyers of prime properties were international.
The number of new homes sales in 2019 more than tripled compared to 2018, largely due to the high number of completed projects in Barcelona. Most buyers of new homes in the Catalan capital purchased for investment reasons (44%). 21% purchased as a secondary residence, 19% to obtain the Golden Visa and 14% as a primary residence. More than a quarter of new homes sales in Barcelona were made by Middle Eastern buyers. The average price of a new home sold by Lucas Fox across all its regions was €936,346, down by 8% when compared to 2018.
Official statistics show sales slowdown
The increase in Lucas Fox sales figures goes against the national trend. Spain’s National Institute of Statistics (INE) shows a decrease of 3.6% in the number of transactions across Spain from January to November 2019 compared to the same period in 2018. There were small decreases in all the main regions except for Girona province which saw annual sales transactions rise by just over 1% in the eleven months to 2019.
Prices on the up
Average sales prices across Spain increased by 4.6% year-on-year (idealista), when comparing prices from December 2018 to December 2019. It is the 35th consecutive month that property prices have gone up in Spain. Since December 2014, prices have increased by almost 13% but they are still just under 13% below those in December 2007 when prices were at their peak. The provinces that registered some of the most significant price rises were Málaga (8.5%), the Balearic Islands (6.6%) and Girona (5.2%). Prices in Valencia Province increased by 3.5%, in the Community of Madrid by 3.3% and in Barcelona Province by 3.2%. Prices in Madrid City saw an increase of 1.3% (€3,732 per square metre) and in Valencia City an increase of 3.1% (€1,779 per square metre). After five years of price rises, property prices in the city of Barcelona are stabilising. In 2019 they fell by 2.5%, with prices averaging at €4,115 per square metre in December 2019.
Madrid City and Barcelona City have both surpassed the prices registered in December 2007 – by 6.8% and 1.1% respectively. Valencia City prices are still 24.6% below what they were in December 2007.
Compared to December 2014, Madrid prices are up by 38.6%, Barcelona by 34.4% and Valencia by 30.2%.
“The uncertainty over the political situation in Spain and Catalonia evidently had some effect on the numbers of homes being exchanged in 2019,” comments Lucas Fox co-founder Alexander Vaughan. “But following the formation of Spain’s first coalition government and the news that talks are set to take place between Madrid and Catalonia, the political scene is more stable which will be good news for the property market.
Our own figures for 2019 were very encouraging, thanks to the ongoing demand for good quality properties in desirable locations from both national and international buyers. The demand has been particularly strong in the prime market, a sector that has seen Lucas Fox become increasingly dominant in the last few years. The rise in sales volume is also due to the company expanding its portfolio to incorporate more ‘second-tier’ destinations, such as Girona, Málaga and Alicante.
The financial markets and the Spanish economy are continuing to perform well and interest rates are at historic lows, resulting in some very attractive fixed term mortgage packages.
According to Moody’s, values are set to grow by 5.5% in the next twelve months. We believe that investing in property in Spain continues to be one of the safest strategies for a good return on investment.”