Brits amongst the most active purchasers in Spain and the islands

May 15, 2012 – 9:27 am

Brits active in property market in Tenerife and Spain

Official figures show that Brits were among the most active purchasers of homes in Costa Blanca last year, along with the Russian and Norwegians, which collectively made up 80% of all transactions in the region.

According to figures obtained from Spain’s notaries, at least 9,200 foreigners bought holiday homes on the Costa Blanca last year, including 5,200 in the Catalonia region Costa Brava/Dorada, and 4,600 in Malaga  Costa del Sol; Balearics (2,700), and Murcia (1,500).

José Vicente Dómine, Director General of Public Works for the Generalitat (Valencian regional government), told the press that more overseas nationals purchased bought homes on the Costa Blanca last year than in Madrid and Andalusia combined, and almost as much as Catalonia, the Balearics, and Murcia combined.

While the Spanish property market continues to suffer from an oversupply of homes, now is a great opportunity “for foreign buyers to bag a bargain on the Spanish coast,” said Spanish property commentator Mark Stucklin.

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Brits taking advantage of weak Spanish property market

May 8, 2012 – 9:36 am

Brits taking advantage of cheaper property in Spain and Tenerife

The volume of Brits taking advantage of the weak Spanish property market by purchasing homes continues to grow, new research shows.

According to latest figures from the National Statistics Institute, the number of British residents in the Balearics has risen by 75 in the past year bringing the official total to 23,773 people. The average age of this British contingent is now 46.6 years old.

Stephen Dight, managing director of Mallorca, and Ibiza, Sotheby’s International Realty, says: “The Balearics are a much more aspirational destination and, with higher property prices and lower supply of quality homes than mainland, attract a wealthier expat. Fluctuations in exchange rates lessening pension income or small percentage falls in property values are unlikely to affect our British Balearic expats and be a tipping point to force an exodus  they are simply not living on tight budgets.”

The largest in the Balearic archipelago, the Island of Mallorca features a host of popular beaches, villages and marinas, fertile agricultural plains, 26 golf courses, an impressive capital city and imposing mountain ranges, which partly explains why it attracts over 10m tourists each year.

Meanwhile the Canary Islands, particularly Tenerife are experiencing a similar upturn of interest in the top end coastal properties.

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The biggest annualised fall in Spanish property prices since the crisis began

April 16, 2012 – 8:35 am

Average Spanish house prices fell 11.5pc in March compared to the same time last year, according to the latest data from Tinsa, one of Spain’s biggest appraisal companies.

House prices fall in Tenerife and the Canary Islands in Spain's slump

That represents the biggest fall in the index since the crisis began and since Tinsa started publishing this index.

Housing on the coast, where most holiday homes are located, fell 10,79pc, marginally less than the national average. Prices in the Balearics and the Canaries were down 9.71pc.

Peak (Dec. 2007) to present, average national prices have fallen 28.6pc and by 35pc on the coast, all according to the Tinsa Index.

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Banking reforms set to hit Spanish property prices

March 20, 2012 – 10:11 am

Banking reforms in Tenerife and Spain affect property prices

New banking reforms are expected to hit Spanish property prices hard, causing values to plummet across many parts of the country, particularly in popular holiday destinations, presenting further bargains for house hunters looking to buy a home in Spain.

According to Spanish Property Insight, referring to a recent article in the Spanish financial daily Cinco Días, the Spanish government has introduced reforms to reduce home prices and get banks lending again. But some experts believe that this will cause the price of holiday homes on the coast to plummet due to the chronic oversupply of unsold homes on the market.

Josep Oliver, economics professor at the Autonomous University of Barcelona, believes that property prices in the country’s main cities are now at or near the bottom of the downturn, but the same can not be said for holiday homes along the coast.

“There is not much room left for price declines,” he told the press. “Discounts of up to 50% are only being considered for holiday homes or unfinished new-developments.Whilst the stock grows in holiday home areas, demand is focused on big cities and provincial capitals where there is little excess and prices have already adjusted.”

According to CatalunyaCaixa, a savings bank, about 65% Spain’s housing glut of 800,000 new homes was built on the coast with holiday home buyers in mind, especially in Catalonia, the Balearics, the Valencian Region, Murcia and Andalucia.

The province with the biggest problem by far is Castellón, in the North of the Valencian Region, and home to the so-called Orange-blossom coast (Costa del Azahar), with around 114,000 empty new homes, compared to 57,000 in Barcelona and Alicante (Costa Blanca), 52,000 in Murcia, and 40,000 in Valencia province.

“That means Castellón, a relatively unheard of destination with a new airport that nobody yet flies to, is responsible for around 20% of the entire Spanish glut of new holiday-homes. New developments in Castellón like Marina D’or development help explain why, said Mark Stucklin of Spanish Property Insight.

He added: “The excess inventory of new homes in Malaga province, home to the Costa del Sol, is relatively minor in comparison. According to local builders there are less than 20,000 new homes on the market, most of which will have sold in the next couple of years. The Costa del Sol is a mature market with good access and diversified international demand where almost everything sells in due course.

“The Costa del Azhar is a different story. Who will buy 114,000 new holiday-homes there in any reasonable time-frame? What if prices get really cheap there? Will that help, or is there no demand at any price?”

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Cheaper homes in Spain as sellers try to attract more buyers

February 17, 2012 – 2:33 pm

Cheaper rental and sale property prices in Tenerife and Spain

Resale Spanish property asking prices continued to fall last month, as more vendors slashed prices in a bid to secure a sale. The latest home price index published by idealista.com shows that the average price of a home in Spain depreciated by 9.4% compared to January 2011.

The figures provided by the Spanish property portal reveal that January 2012 was the worst month since the Spanish housing crisis started four years ago. On a month on month basis, asking prices of homes in the idealista.com database depreciated by 1.9% to an average price of €2,045sqm (£1,712sqm) suggesting that homeowners are becoming more realistic about the need to reduce property prices if they are going to have any chance of attracting more home buyers.

It represents the biggest fall in asking prices since idealista.com started publishing the index before the property crash got underway in 2008.

On a monthly basis, prices fell the most in Castille La Mancha (-2.3%), followed by The Balearics, Asturias and Andalucia (-2.1%).  With property prices falling, housing affordability has somewhat improved in Spain, based on average property prices versus average gross annual household income, which has fallen from 7.7 years at the peak of the property boom to a current rate of 6.2 years, according to the Bank of Spain.

Spanish families might welcome more affordable housing,  but housing is still much more expensive than it was before the boom, when it cost just 4 years gross annual income or less.

“There are several reasons why the affordability ratio has not improved more with falling property prices, including higher mortgage borrowing costs and lower household income, said Spanish property commentator Mark Stucklin.

He continued: “None of this really applies to the cost of holiday-homes on the coast, where prices have fallen substantially more than the national average, and where foreigners with higher incomes than the Spanish national average tend to buy.”


The average cost of renting a home in Spain also fell last year as rental prices depreciated in 77% of Spain’s primary rental markets, the latest to data from Idealista.com and the Public Rental Company show.

The greatest rental price decline was recorded in Toledo by 8.7%, followed by a 6.8% drop in Oviedo. In Spain’s largest cities of Barcelona, Madrid and Valencia rents fell by 3.1%, 1.3% and 4% respectively.
However, rents actually increased in Lleida, Bilbao and Alicante rentals, rising 11.2%, 4.2% and 4.1% respectively.

These rental price declines follow on from falls in 2010, suggesting that Spanish homes are becoming cheaper to rent, as well as buy.

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Valencia is the most popular area in Spain for property

February 13, 2012 – 12:05 pm

Tenerife still a popular destination to purchase property

The most popular area of Spain for property is  Valencia, according to the MoveChannel. The information, which is based upon the enquiries received by the property portal in the last 12 months, shows that buyers scour South-East Spain for real estate, with Valencia attracting 32.24 per cent of all enquiries.

Close behind is Andalucia, which received 30.84 per cent of Spanish property enquiries, followed by Murcia, which accounted for 19.04 per cent. These top three regions carve out a clear favourite corner for buyers, who look almost exclusively at homes for sale in the Costas: Costa Blanca, Costa Calida, Costa del Sol and Costa de la Luz all fall within the three regions, while Costa Brava is located in the other key popular area of Catalunia, which is ranked sixth.

The least popular areas are La Rioja and Cantabria, even  Madrid, surrounding the country’s capital, received just 0.08 per cent of all enquiries, far behind that of rising tourist zone Galicia .

Buyers also search for sun and sand away from the mainland. Together, the Balearic Islands and Canary Islands accounted for over 12 per cent of Spanish real estate enquiries. The Balearics alone received 5.13 per cent, more than the whole of northern Spain combined. Given the wider popularity of Spain’s island regions, the absence of the Canaries or Balearics from the top 10 suggests that buyers search for property by island as opposed to looking for specific cities.

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Real estate in the Canary Islands fairs better than mainland Spain

September 19, 2011 – 9:34 am

Tenerife and the Canary islands fairing better in the property stakes than mainland Spain

Real estate in  the Canary and Balearic Islands has experienced much lower price drops than in other parts of Spain, it has been noted.

Managing director of Spanish-Living Adrian Warriner pointed out that the two archipelagos – which include destinations such as Tenerife, Ibiza and Mallorca – have fared better than their mainland counterparts, recording just a 2.5 per cent fall in values over the last year.

“This is good if you already own a property there, but not so good if you are an investor looking for a bargain,” he stated.

Mr Warriner went on to suggest that those hoping to buy a home in Spain while the market is low may want to consider the Costa del Sol, which has seen average prices decline by more than ten per cent in the past 12 months.

Source: PropertyShowrooms

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Spanish house prices fall again,though prime areas fair better

September 12, 2011 – 9:07 am

Property prices in Tenerife,Balearics and Costa Brava fair better than the rest of Spain

Average Spanish house prices fell 4.1pc over 12 months to the end of Q1, according to the latest house price index published by Spain’s National Institute of Statistics (INE).

That represents a turn for the worse after prices clawed their way back towards stability in the second half of last year.

New build prices fell 1.9pc, whilst resales were down 6.3pc, the worst result since Q3 2009.

This ties in with other data such as falling transactions to paint a picture of a housing market still far from out of the woods.

Not all market segments are suffering equally. Prime segments in upmarket destinations like the Costa Brava,Tenerife, and the Balearics are doing better.

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Average prices have declined say TINSA

August 29, 2011 – 10:26 am

Average house prices have declined 6.6pc over 12 months to the end of June,according to the house price index published by Tinsa – one of Spain’s leading appraisal companies.

Holiday homes have led the fall, with prices on the coast down 8.7pc in 12 months. The market on the coast is struggling to digest a large helping of second homes, made more indigestible by the disappearance of British buyers.

After the latest falls, prices are now back to where they were 6 years in 2005, but even that means that prices might still be too high.

Peak-to-present, house prices on the coast have fallen the most (-28.8pc), followed by cities (-23.4pc), suburbs (-22.9pc), and the islands (-20pc). On average prices are down 20pc since their peak at the end of 2007

 Tinsa state a fall of -7%  for the Canaries and Balearics, however the market appears to be improving again in Tenerife.

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House price index for Spain

May 9, 2011 – 8:35 am

The Official House Price Index published by the National Institute of Statistics (INE) would have us believe that Spanish house prices fell a mere 1.9pc in 2010

New build (vivienda nueva) prices fell -2.1pc, and resales (segunda mano) fell -1.6pc

The suggestion that Spanish property prices only fell 1.9pc last year, against a background of 20pc unemployment, tightening mortgage credit, and a monumental property glut is difficult to fathom.

These figures tend to distort price signals from the market and put off potential buyers. We might be better off if the INE did not publish house price figures. Not all official figures are so unreliable. According to figures from the Department of Housing, prices fell -3.5pc last year, and 6.5pc in real terms (after adjusting for inflation). That sounds closer to the truth, even if maybe still a touch  too optimistic.

Meanwhile, whilst mainland  Spain struggles in the property sector, the  islands, particularly the Balearics continue to improve, Tenerife being the best performer from the Canary Islands at the moment, mainly in the area of prime coastal property.

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