Experts forecast real estate market of Spain to see a growth till 2025

Experts forecast real estate market of Spain to see a growth till 2025

The real estate market in the Costa del Sol and Spain is set to see a 40% growth within the next ten years, opined an expert.

With the prevailing trends, the growth trends can be expected up to 2025 as per forecasts from Jose Luis Suarez, who is a professor of financial management at the IESE Business School.

After considering the existing property trends, Suarez said that the appreciation of property prices are certain for the next decade and it is similar to the trends exhibited by the real estate before it reached a new high in 2008, just before it crashed.

The professor predicts that the property price will go up by 40% by 2025, as Spain is a hot destination for property investments.

The demand for houses in Spain will go up and nearly 100,000 houses will be added every year until 2020, following which there will be an addition of 140,000 houses annually till 2025.

This time, the property hype is controlled and is not like the last time, with investors keeping it realistic and not expecting quick returns from the market. The increase in property prices for the first quarter in 2016 stood at 6.3%.

Suarez indicates that it is a bright season ahead for the housing industry after a lean period in 2014, where only 50,000 houses were added, unlike the peak of 800,000 houses back in 2008 before it all crashed.

Rise in Spanish Property Prices Expected to Increase Until 2025

Rise in Spanish Property Prices Expected to Increase Until 2025

Property prices in Spain will continue to rise which is

great news for the Costa del sol

The slump in the Spanish property market lasted a good seven years but things are on the up now, with one market analysis suggesting that prices are set to continue increasing steadily for the next nine years until Spain reaches the peak prices of 2007 once more.

Or so José Luis Suárez, a financial management professor with the IESE business school, claims. He gave a now-widely-quoted symposium over the weekend in which he claimed that Spain will need to build 100,000 new homes each year until 2020, with the demand increasing for the next five years to 140,000.

There are a number of reasons people should be optimistic about the health of the property sector in Spain. While a number of encouraging reports have come out this is by far the most encouraging one. It was between 2007 and 2014 that the demand for property took a sharp downturn with only 75,000 homes built a year, down significantly from the high of 800,000 in 2006. Suárez believes that Spain is headed for a slow but steady recovery now after construction reached an all time low of 50,000 in 2015.

Madrid and the Costa del Sol is currently where the highest demand for new property is. Roughly 25,000 homes are constructed there each year.

Suárez had something to say about the average price per square metre of residential property too. He made the point that the annual rises seen leading up to 2007 were followed by bludgeoning cuts. The price per square metre fell from 2,062 euros in 2007 to around 1,400 euros in 2014. He expects that it will be 2025 when we see the peak price from 2007 once more. It is worth noting however that this figure doesn’t take inflation into account. It’s not an accurate representation of the “real” value.

It his figures prove accurate though it means that Spanish property can expect an appreciation of around 40% in nine years, making investing in Spanish property a smart choice. You should keep in mind that market trends change all the time and are also different from area to area.