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Spanish property markets such as Marbella see recovery, new analysis shows
After seven years of stagnation the property market in Spain is experiencing an uptick in sales and prices have reached bottom, according to a new analysis report. With the Spanish economy improving, unemployment falling, tax revenue growing and a more stable banking system, lending figures are on the rise, says the analysis from Diana Morales Properties, an associate of international real estate firm Knight Frank. It points out that the typical mortgage lending rate dropped from 4.21% to 3.29% over the course of 2014 and this has fed through to buyer confidence. Andalucía and the Canary Islands have seen some of the strongest surges in mortgage lending, up 25% and 26% respectively month on month, compared to the national average of 14.2%. This renewed confidence and interest in Spanish real estate is most evident in Madrid and Barcelona where capital flows into both cities’ commercial markets topped €2.7 billion in 2014, the analysis says. It also points out that the return of large US investment funds has been notable but not just in Spain’s main cities. ‘The acquisition of Sotogrande by US based Cerberus and developments to the east and west of Marbella by other US funds, as well as the purchase of Monte Mayor golf club by Russian investors hint at the extent to which the recovery is gaining traction,’ it says. Marbella, a popular area with overseas buyers is building on a property market recovery that began in 2013 despite Spanish buyers failing to return in any significant number in 2014 and the Ukraine crisis impacting on the number of Russian buyers. There was strong demand from an increasingly diversified client base of Scandinavian, Benelux, French, Arabian and Moroccan buyers which added to the record tourist numbers lending a certain buoyancy to the local economy. Marbella and its surrounding municipalities of Estepona and Benahavis together recorded a 27.7% increase in property sales in 2014 compared with a year earlier. Marbella, however, outperformed its neighbours, by experiencing an 89% jump in property sales between 2008 and 2014 according to Spain’s Ministry of Public Works. Benahavis and Estepona, by comparison, recorded rises of 62.3% and 22.8% respectively over the same period. It also reveals that the amount of time properties spend on the market is dropping if realistically priced, while in some prime beachfront locations there is even a shortage of available homes, complete with waiting lists for specific property types. The analysis says that new bank repossessions remain and this has prompted the return of new construction that remains for the moment primarily focused on individual villas and small to medium sized developments of apartments and villa communities. Continue reading
UK property market set for further growth due to stable election result
House prices in the UK, especially the prime property market in London, are set to rise on the back of the Conservative win at the general election, according to property experts. London is likely to see sales surge as people who put off buying, particularly overseas buyers, now go ahead and make a decision with the possibility of a mansion tax evaporated. Indeed, according to Edward Heaton, of Heaton and Partners property search agency prime country house prices could rise by as much as 10% within weeks. ‘There will be bun fights in the next few weeks for the best houses which come to the market as confidence in the top-end of the regional market returns,’ he said. ‘For many operating in the prime property market, there is a palpable sense of relief at the election outcome as there were some genuine concerns about the possible impact of mansion tax tied in with the attack on non-doms proposed by Labour,’ he added. The result will bring stability to the markets, according to Michelle van Vuuren, managing director of residential development at Sotheby’s International Realty UK. The firm is already getting calls from would be international buyers. ‘The removal of the uncertainty that has clouded the last year of the coalition will allow developers to plan confidently for the medium term with a consistent economic policy. Having said that, we do hope to see the Tories come good on their annual pledge of 200,000 new homes and freeing up brownfield sites for development,’ she said. ‘Increasing the supply of homes is the only way to truly overcome the hurdles that the housing market places for the majority of buyers. At the top end, for the next five years at least, a cessation of the clamour for a mansion tax will see a number of transactions that have stalled to come back on line as certitude creeps back into the market. It is going to be an exciting time to be in the London market,’ she added. ‘Andrew Ellinas, director of central and north west London agency Sandfords, believes that confidence will return quickly and it is likely that there will be a significant late spring bounce in activity as those who have held back start to act. ‘London has established itself around the world as a safe and thriving place to invest and increased confidence will once again be restored and with that see the return of overseas investors. It has felt like the market was becalmed and now will steam ahead once again, with London prices that have been subdued steadily rising throughout the second half of the year,’ he pointed out. ‘My advice to those who have been thinking about selling, but awaiting political certainty, is to make a move now and beat the rush. The market has been challenged most recently by a lack of stock, but this is likely to change quite swiftly now, creating more competition for vendors. Take… Continue reading
Prime central London property starting to outperform other areas of the city
Homes in prime central London saw the biggest rise in value during the first quarter of 2015, as the centre starts to outperform outer prime parts of the capital for first time since June 2013. Buyers now pay a 34% price premium to live in prime central areas like Kensington and Chelsea, according to estate agent Marsh & Parsons’ latest London Property Monitor. Historically, property prices in the most affluent prime central areas of London had been accelerating away from values in the rest of the capital, due to consistently higher demand from overseas and domestic buyers keen to live in the most famous London locations. However, over the past two years, areas such as Brook Green and Balham have experienced some of the steepest price rises across the capital, according to the firm, but this looks to have been a short term phenomenon. While outer prime house prices have fallen 1.8% in the past three months, there has been a resurgence in price growth in prestigious prime central London with values up 0.3% throughout the last quarter. This is the first time in over a year that price rises in exclusive central areas like Pimlico and Kensington have overtaken the growth in more affordable areas like Balham, and this is a trend that Marsh & Parsons expect to continue throughout this year. As a result of this turnaround, the price premium paid for Prime London property has risen for the first time in 15 months, and is now back in line with last year. Buyers can currently expect to pay a 34% premium to live in central locations. ‘Balham and Brook Green have been putting on the most astonishing performance recently, with an eye catching spurt of growth in 2014. In the long run, the traditional property stalwarts of Kensington, Chelsea and Holland Park are proving they have the stamina to withstand a wider market slowdown,’ said Peter Rollings, chief executive officer of Marsh & Parsons. ‘While the market slows in other parts of the London housing market, the enduring appeal of the most desirable prime central postcodes has ensured growth ticks on. We believe this trend is set to continue in the next 12 months, with prime central areas outperforming outer prime areas for the first time in more than two years,’ he explained. As growth at the higher end of the market continues momentum, the proportion of million-pound properties in prime central London has risen 3% in the past quarter, to stand at 67% of all homes. With the average house price currently standing at £2,080,742 in these areas, 38% of properties in prime central London are now worth £2 million or more, highlighting the implications of any mansion tax on the housing market in these parts of capital. In addition, some 22% of prime central London properties surpass the £3 million threshold. The report also… Continue reading
