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24 April, 2017
The Spanish property market has shown promising signs that it will continue to recover during 2017. The land registry has released figures that show that sales increased by 19% during January year on year. This has been boosted by the highest number of recorded sales since 2008 as the Balearics saw a 40% increase as well as the Costa Brava seeing an increase in sales of 28%.
Overseas buyers helped to move the market along in southern locations, particularly in the Costa del Sol although sales in these areas may have been affected by the Brexit decision in the UK last year. However, things are not great everywhere as areas such as Costa de la Luz and the canaries saw sales figures drop.
On the whole, resales increase by 21% while new home sales rose by 8% and this shows that the new development slump that was experienced during the financial crisis is now coming to an end. More foreign buyers are returning to the market but Brexit is still having an impact on British buyers as well as the Americans being affected by the election of Donald Trump as president.
Second home enquiries in once popular areas have declined following the Brexit vote with the Costa del Sol experiencing a down turn but UK buyers were showing an interest in Ibiza and Barcelona.
The weakening of the pound has caused UK buyers to drop away although the lower end of the market is experiencing some movement as the number of sellers of re-sale properties offered at a discount price has increased.
Regardless of the Brexit decision, British buyers still dominated the number of foreign buyers purchasing in Spain in 2016 although this had dropped from 2015. The number of buyers from the Middle East had also dropped in 2016 when compared to 2015.
The number of buyers from Scandinavia has grown from 4% to 7% between 2015 and 2016 although French buyers have fallen in numbers to 6% from 9%. In contrast, and despite the American Presidency decision, American buyers have increase by half a percent from 4.5% to 5% between 2015 and 2016.
There is a promising rise in national and international demand for homes situated in popular cities as well as those destinations that are popular with second home buyers. All of which shows that the Spanish economy is recovering, regardless of the political uncertainty.
Interest rates continue to remain low and so, many are opting to put their money into property instead of traditional savings accounts while banks are continuing to show that they are willing to lend.
Optimism surround the recovery of the Spanish property market remains high as it is expected to improve during the course of 2017 as well as next few years. Prices are increasing along with transaction numbers in many of the big cities but other areas paint a different picture as many property owners are having to reduce their asking prices in order to obtain a sale.
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