Property prices in Spain are expected to rise and fall in 2014 as the market adjusts to a growing demand and realisation among buyers that there are still bargains to be had…
The bargains are unlikely to be in Mallorca, Ibiza, Marbella or Puerto Banús where prices edged higher in 2013, driven by the international demand – up 29% – and shortages of prime location apartments and villas due to planning restraints. New developments, getting underway, will offer offplan opportunities for buyers who have done their homework.
Sales in the Costa del Sol increased by 61% last year and the Des Res areas of Costa Blanca soared by 52% as foreign buyers snapped in the bargains in prime coastal locations. There were price falls on inland property, short on local amenities and sea views, but experts expect these to stabilise in the second half of 2014 as better located homes sell-out.
With peak to present prices remaining an average 44% lower, last year proved to be pivotal for Spanish real estate. A new wave of buyer confidence eddied around prime Costa locations, especially property controlled by Spanish banks who were still rebalancing their books after taking on distressed property from funded developers and private owners.
SAVAGE PRICE REDUCTIONS BY SPANISH BANKS
The banks offered savage price reductions, with the best deal on San Roque Club, a Sotogrande golf complex where spacious mansion-style apartments were sold off for book value of around €200,000 after the developer ran into trouble. Previously, they had been selling very well via the developer for €1.1M to €1.4M, according to international brokers, Walker Property Spain who sold the last of 18 distressed units just before the end of the year.
The firm, who specialise in bank-owned residential and commercial property, reported increased inquiries from non European buyers, keen to explore the potential of property purchases linked to the so-called Golden Passport, Spanish residency available for a minimum €500,000 investment. The Citizen Spain scheme offers the famous Spanish lifestyle and the opportunity for overseas investors to put their money and, where necessary, their families in a more secure and politically stable country.
Walker Property Spain and other mainstream sellers expect to continue to offer bank controlled property in established favourite Costas, but additionally the best bargains could be all year round beach holiday destinations like Fuerteventura, in the Canary Islands. Prices start at €76,000 for 3-bed, 3-bath pueblo houses overlooking a Caribbean-style beach at Cala de Fuste – probably the best deal for Spain in 2014?