Buoyant Sales and a Genuine Increase in Property Values!
I’m always happy to report on an increase in Spanish property sales volumes. This has been the case now for the past 5 or 6 years. This ‘good news’ is not an exaggeration; it is an established fact. The number of property sales transactions recorded by Notaries and the Land Registry is definitive proof. When a sale takes place, these official bodies are the only place to record them, they cannot lie; they are fact. However, there is always reasonable cause for doubt when it comes to alleged increases in property values.
To begin, property values are not an exact science. There can be a big discrepancy between what an owner would like to receive compared to an agent’s valuation and for that matter, what a bank is prepared to loan against their estimated value.
Owners will naturally want to achieve the highest price possible. An agent would prefer to market a property at a price they can expect to achieve given their prevailing experience of buyer’s expectations. Banks simply want to minimise their risk and consequently value the property at what they would expect to recover at an auction should the mortgagee default on their loan.
With this in mind, my current experiences have been that prices have hedged upwards in the past 3-4 months. It is still very much influenced by location and demand for the type of property concerned. There is never an average increase; it is very definitely influenced by area and availability. In the past, we have seen offers accepted at 15-20% below the asking price, but more recently have presided over sales achieving the asking price and, in some cases, exceeding them. I would be reluctant to quantify the exact increase in property values in our particular region of Murcia, but in the popular locations along the coast and on resorts my experience suggests around 5-7% on the same quarter last year. On country and village properties, we are identifying increases of 2-4%.
Since the beginning of the year, we have struggled to find new property listings at the same pace as sales. This year to date has been extraordinarily successful for vendors and agents. There is no obvious explanation for this increase in demand, but it certainly feels like the very early days between 2000 and 2003/4. I only hope that it continues in a measured and responsible way.
If you have a property to sell in the countryside, a village or a coastal/golf location, please feel free to contact us with a view to putting it on the market.
Finally, I do enjoy responding to your email questions and requests for advice in response to my monthly column. I always reply within the day if possible and hope you find my answers helpful and fairly balanced.
Fuente Alamo Real Estate/Murcia Coast & Country
Tel 0034 625 534 504