Mar 23, 2021 Newsletter

The Spanish Real estate market withstands the impact of the pandemic

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Those who are waiting for major price drops might get impatient. The estate market is resisting pretty well the impact of the pandemic

Experts predict that the current interest in home sales and purchases will continue at the same level throughout the year 2021.
According to data provided in March by the real estate valuation company Tinsa, the average price of new and second-hand housing remains at similar levels to those of a year ago and supports the general recovery that began at the end of 2020. Thus, in February, the year-on-year growth in housing prices was 0.7%.

‘The price has held up quite well. In fact, prices don’t tend to correct themselves too much, because this is a very mature market and it remains stable,” says José Manuel Pedregal, Director of Financing Solutions at Banco Sabadell, on the Banco Sabadell Podcast.

For the National Federation of Real Estate Associations (FAI), a slow but more optimistic take-off is expected for 2021, especially from the second half of the year, reaching half a million sales by the end of the year.

The dream of more space, light and outdoors

What the pandemic has brought is a special interest in different homes, which has influenced those that are experiencing the highest price increases.

In general terms, the upside are homes with more usable surface area, as well as with outdoor and private spaces and peripheral to large cities, while the downside are apartments without terraces and/or interiors with low energy efficiency located in central areas.

During the confinement, most people wanted to have a terrace, an extra room or a villa, which has been transferred to the type of housing search on the Internet.

In Fotocasa, apartments represent 52% of total searches, although these have dropped by 14% and it is the only typology that has fallen since the outbreak of the pandemic.

Rustic properties, villas and semi-detached houses are the typologies that are growing the most in the search for new housing.

At present, there is one type of housing that is most in demand. It is a 100-square-meter home, with three bedrooms and a terrace.

The purchase decision: what to consider?

At times, almost all buyers are plagued by doubts about whether they are making the right decision. The answer is clear: If there were no sales transactions in the housing market, you would have doubts about whether the home you are buying is priced right.

But when there are a lot of sales transactions, as in the urban environment, the purchase prices are very highly-priced.

If the purchase fits what you need and what you can afford, it’s always a good purchase.

Equally, it is not a bad time to sell if the product is in line with prevailing tastes, but if the property was acquired during the real estate boom years, it is going to have to be sold below the price at which it was purchased.

Get yourself in pole position about real estate in Spain

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