Lowest Property prices in Spain after Covid: Prices expected to go up.
There are many indicators, that house prices in Spain have reach their bottom and will go up soon. At least, in many segments and for internal buyers.
In this article I can explain the SIX REASONS.
So WHY is it NOW the best time to buy a house in Spain? You will save MONEY.
I will summarize it in 6 takeaways.
1. We start to see a shortage of good properties.
To start: what is a good property? In general, for a city apartment, that’s two bedrooms, one-bathroom, little balcony, elevator, from 2nd floor upwards (more light, less noise), in a building without too much maintenance and if you’re lucky, even nicely decorated. In another business case, a ‘good property’ can also be a house or apartment that needs a full renovation. For the Costas it’s more about the quality of the house, private space and maybe in a complex with shared facilities (sports, swimming pool,).
The shortage of this type of wanted properties is noticed with some geographical differences in Spain. Typically, Barcelona is the leading indicator for cycles in the real estate market and moves first in terms of market drops or recovers. Then normally Madrid follows, and then the rest of Spain.
In Barcelona, we slowly start to see a shortage of these good properties. There is a strong local demand, and international buyers with more savings, eagerness and emotionality are back and sometimes pay more than the market price. In the Canary and Balearic Islands, this shortage also happens, with an upward trend of the attached price tag.
We notice it clearly in our daily job as buyer agents: when we see a good property for a customer, it’s all about being fast. Waiting means that house will already be reserved by someone else.
The Spanish real estate figures in the first 6 months of 2021 show why: the 267.000 property transactions in Spain during the first semester of 2021 were the highest since 2008. That number is a lot! Some of the properties that was there the past months is starting to evaporate and high demand + less offer will push prices up (with a delay).
2. Both local and international demand is up and will further increase
The economic outlook for Spain is positive. The Bank of Spain and the European institutions predict a 5-7% GDP increase for 2021 and 2022. That’s good news for local property buyers, and a good sign for banks to give financing.
Internationals, as mentioned before, have found their way back to Spanish property grounds with a different drive and desire. They gathered more savings during the restricted pandemic period and Northies desire – more than ever – sunny destinations. To go on holiday, but nowadays more and more to work remotely too. About 90% of our current customers want a property with the ability to work from ‘home’. That ‘home’ is generally not Spain, but a colder country that they escape to enjoy the sun after work. That used to be for a long weekend, but now we see customers coming several weeks per month.