Spanish real estate sector starts this year of prosperity with some turbulence and with the shadow of an exiled bubble. It remains to be seen affected by the political situation in Catalonia. “People are slowing down sales decisions”, says Fernando Encinar, head of studies of Idealista.
Prices of property in Spain will increase by 16.9% in 2018 compared to the previous year, surpassing the 472,000 operations, according to Julián Cabanillas, CEO of Servihabitat. The market loosens in the end of the year and does not exceed the barrier of half a million houses as was predicted months ago, but even so it will be the largest record since 2008 "The level of activity and prices have been very intense, but we have to remember that we are very far from the level of 2007, when 775,300 operations have been completed and 2 million mortgages have been given, compared to 320,000 in 2017" explains Beatriz Toribio, responsible for studies in Fotocasa. Servihabitat calculates that in 2018 560,000 properties will be sold, so the market will increase by 18.3%. Other forecasts are more cautious: "The total amount of transactions will grow by 9.7% in 2018.
Growth will be burdened by the situation in Catalonia that will evolve below your possibilities" says José Luis Suárez, professor of IESE Business School. The demand for renovation will continue to take transactions and young people will continue to find it complicated to buy a first home. "The power purchase which is necessary to purchase a property is reduced by unstable labor situation and by small ability to save", indicates Ferran Font, director of studies at Pisos.com. But "by 2019 the first access will be as important as the demand for replenishment", predicts Gonzalo Bernados, analyst and real estate consultant. New housing will be more difficult to get in 2018 because of increasing taxes. "This year prices for properties will increase by 4.5% on average in Spain, for the next year the forecast is 4.7% ", Calculate Cabanillas. Although at this point There are also discrepancies. According to Raven, in 2018 prices will go up between 6% and 8%. The agency Moody's estimates that prices will increase by 8.6% in three years ahead. Changes could lead banks to toughen credit conditions. Others deny that. "The law will not have an impact on the price. The number of mortgages at a fixed rate is growing (four out of ten new contracts), a figure that will increase thanks to the new law. Fixed rates are higher than the variables, so in 2018 average rates are going to increase", emphasize in Idealista. But Spanish real estate sector faces other challenges. The biggest one is Catalonia. At the moment, there are people who see the glass half full. "What happened in Barcelona will clean up speculators and prevent increasing of prices by 20% that was foreseen in 2018.
Of course, investors will take time to return and Madrid and Valencia are going to have a benefit out of it", says Bernardos. Another obstacle for 2018 is an expensive land. The price for a square meter has grown in the third quarter by 7.8%, up to 162 euros, according to Promotion. As for the rent, the high returns sought by investors, the tourist rental boom and the change of mentality of the Spaniards will continue pressing up the price during big part of 2018. After years of intense rises, it appears that the owners start to sale according your expectations.
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