Spain’s housing market flourishing rapidly owing to the new properties and large influx of foreign investors.
New construction is being snapped up by foreign buyers
which is great news for the Costa del sol.
The housing market of Spain seems to sound promising, due to the increase in the number of foreign buyers and also due to approvals given to several new construction projects.
Predominantly, the two main factors that triggered the last housing crash were the proliferation of newly built homes in Spain along with the large number of foreign investors, who had intent to realize profits hastily.
Apart from that, there were several other counter factors that played a role as well, but the unreliable builders and credit-backed buyers went into panic mode, thereby triggering the crash and putting all the financial entities in a tight position.
This would clearly create an impression that people were skeptical when they heard this news as they would not want the housing market of Spain to witness history again.
However, the best part is that things are not the same like how it was the last time. Now, there is no scope for unsustainable credit. Developers are also not desperately searching for land parcels and developing them rapidly. Instead, procedures are followed and the pace is not the same like how it was during the crash last time.
Based on the figures as released by Formento, plan approvals given increased by 57% during the first quarter of this year compared to the count of last year and the count this year stood at 16,782.
This figure is the highest for a single quarter since 201. However, it nowhere comes close to the previous count of 860,000 approvals back in 2006, which corresponded to 200,000+ approvals being granted on a quarterly basis.
Looking back, this was indeed crazy and a scary move, with a million properties being added in the housing market of Spain within a year. The pace at which properties are being developed in Spain now is manageable and the demand supply gap is maintained.
This has also resulted in the property prices increasing steadily, thereby attracting foreign investors, based on the findings of the Council of Property Registrars.
The statistics released by the Spanish body indicate that there is a 13% hike in the number of foreign nationals purchasing a property in Spain, with over 48,000 properties being sold to foreign investors in the previous year.
The British were the highest number of foreign investors at 21%, while the rest composed of buyers from France, Germany, Sweden and China. Due to the high demand by foreign nationals, property prices in Spain have started to pick up and there is a 6.9% increase quarterly.
Also, a total of 100,000 properties were sold in Spain in the first quarter of 2016, making it the highest in the past 12 quarters.