Market Report Villas & Fincas December 2011
Land Prices and house prices landed in between 20 and 40 percent from peak 2006. It is likely that the prices are still under pressure since the demand is very low.
Supply of quality country properties is reasonable and the supply of bad properties is out of proportions like apartments on the coastal areas. So these properties could expect another hit and quality country villas reached bottom.
Some areas might even escape further falls but it will take some years to return to normality. We still think there are very good business opportunities at the moment. The best opportunities are primary residencies close to Gibraltar, Malaga, Marbella, Estepona, Sotogrande and Ronda. Other areas might continue to suffer a bit. These areas had before the last property boom also a poor demand at very low prices. In these areas and in areas with over supply could fall another 15 – 25pc before they bottom out.
Any significant recovery in Spanish building activity looks far off. The banks need to solve their property stock, write them further off and then the market will start to recover. Our new Partido Popular Politicians need to reorganize, restructure planning and building regulations. Hopefully with the elections in 2012 there will be a change in Andalusia as well, since the current Government did not proof to be very adequate. The new elected Government in April 2012 need to create jobs. The real estate and building industry are since the last decennia leading factors of employment. There are still many people interested to live in Andalusia, but most of them want another type of house, location, and living standard. “Not everybody fits in a 2-bedroom holiday apartment! ”. Small local projects, with a (eco) sustainable character have the future.
There were 19,801 homes sold in October (excluding social housing), the lowest monthly sales figure since the crisis began.
That means the Spanish property market shrank 17pc compared to a year ago, and 10pc compared to just a month ago. Compared to 2007 the market has collapsed a whopping 63pc in volume terms alone.
We see absolutely movement in the market, many clients are still hesitating when the media is writing horror stories again, but generally there is a will to buy in Andalusia. There is demand for more expensive properties. Therefor we expect more buyers for 2012 at stabilized prices with a correction of 40% of the peak price in 2006.
At the time of writing this article, financial markets are more positive, when this is continuing we could even have a serious recovery. Historically we are 1 year behind the US markets. It’s recovering in the USA right now, so at the end of 2012 we ‘could’ be all more confortable.
What do we need in 2012
- New Jobs
- New Politicians
- New Planning regulations, (quickly please) less bureaucracy
- New local (eco) sustainable projects
Tips to sell your house
- Un-clutter, simplify
- Re-paint (light)
- Present your garden, new flowers, pots, herbs
- Re-think pricing
Tips to buy a house
- Location, Location, Location
- Quality matters
- Legal matters count
- Count your money, Mortgages are tight
Merry Christmas and a Prosperous 2012.
Country Properties, villas, houses, homes in rural areas of Andalusia, inland Casares, Gaucin, Ronda, Sotogrande, Vejer de la Frontera, Arcos de la Frontera, Estepona, Marbella, Benahavis, La Zagaleta, Madronal.
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