The British return to purchase in Spain, but this time "Second Hand"
The real problem of the promoters in Spain is not so much the impact of Brexit on the number of homes sold to British, but the change of preferences in that market. After the small slump registered in 2017, following the referendum that approved the departure of the United Kingdom from the European Union, the truth is that the purchase of homes by British citizens inour country has recovered the levels in which it was in the stage prior to Brexit.
In 2018 it is expected that the 10,000 transactions will again be exceeded, although they are still a long way from the figures of 2007 when all the records were broken with just over 17,700 sales, even the 2006 figures have been exceeded, two years before the real estate bubble will jump through the air.
However, although in absolute terms the figures invite optimism, they even serve as an argument for promoters to reject a strong impact of Brexit on transactions, the truth is that there are two data that invite, at least, reflection.
On the one hand, it is true that the purchase of homes by British people is at levels of more than a decade ago. However, unlike what happened before 2014, these now acquire many more second-hand homes than new construction, as can be seen in the graph. A change in trend that coincided with the start of the real estate recovery in Spain and the upward price boom. And this is a trend that is repeated with the rest of nationalities.
In such a way that, although globally the news is positive because foreigners in general, and British in particular, continue to buy houses in Spain, the vast majority are second-hand houses which, undoubtedly, is bad news for the promoter sector that has been launched on the coast for the last two years. For sample, a button. Last December, Simed, the real estate fair in Malaga, thermometer of the promoter and real estate sector in the area was held. The event hosted 160 exhibitors and an offer of 22,000 homes.
High prices and lack of product
Why this change of trend? During the hardest years of the crisis, the abrupt fall in prices allowed many foreigners to buy a new house in Spain at demolition prices. Many of these houses were in the hands of the bank that decided to give them exit through sharp price reductions.
As of 2014, however, there was a turning point. House prices began to touch ground in many locations and prices began to rise. According to data from the appraiser Tinsa, since the post-crisis minima, prices have increased almost 20% in the coastal areas. The strong increases experienced and the lack of supply have caused that demand has opted for the second-hand product. A situation that is observed throughout the country, where second-hand sales account for eight out of ten transactions.
On the other hand, the weight of the British on the group of foreigners who buy a house in Spain has also been significantly reduced.
As can be seen in the graph above, in 2008, the British came to monopolize almost 40% of the operations carried out by foreigners in Spain. Currently, this percentage is only 15%, although it is still the nationality that acquires more homes in our country, far ahead of French and Germans.
Neither Germans nor French together buy as many houses in Spain as the British so, if, as the International Monetary Fund (IMF) says, housing prices evolve in unison in the different countries and major cities of the world - what he calls the synchronicity of the world prices of the housing-, the possible threat of the Spanish real estate market not only would have to look for it in the United Kingdom. Also in France or Germany.