Spanish property price rises set to gain momentum between now and 2020

As 2016 draws to a close there is a feeling of generalized optimism within the Spanish property market that next year will see a continuation of the gradual recovery in prices and sales activity.

Spanish property price rises set to gain momentum between now and 2020. That, at least, is the opinion of R.R. Acuña & Asociados in their 20th annual statistical analysis of the real estate market in this country. The firm states that in Spain as a whole prices will have risen by 2.3% by 31st December this year, and that within two years that rate of increase will have gone up to a healthy 5%, where it will remain until the end of the decade.

In other words, after almost a decade of risky volatility, residential property could represent a sound investment between now and the year 2020, especially in a climate where bank deposit accounts yield extremely low interest.

However, great care is required on the part of investors in Spanish real estate, as Acuña also predict that the wide disparity among the 17 regions and 50 provinces of Spain will continue to be a feature. This is illustrated by the fact that in 2015, when the recovery was already under way, prices rose in under half of Spain’s 8,000-plus municipalities (46.8%, according to Acuña), due to the continuing excess of supply over demand in many areas.

The market is seen as being healthiest Spain’s largest metropolitan areas and on the Costas, where most jobs are likely to be created and economic growth is most probable.

Acuña also predict that the increase in demand will be especially relevant in the area of new builds, where sales have plummeted over the last few years and are expected to total no more than 82,000 in 2016. Now, however, in zones where the market is expanding, the stock of new housing has practically run dry, and construction is expected to increase to meet demand.

Source: Spanish News Today, December 2016