Property Sales Flatten Out
Since 2014, the Spanish Property Sales Market has been increasing in volume. It peaked in 2007 with almost 80,000 residences sold per month. The market hit rock bottom in 2014 as sales fell back to around 35,000 units per month. Then came the steady, year-on-year growth up until 2018, but recent figures now show that 2019 is looking like a flat year, where sales will more or less level out.
As the Eurozone economies are stalling, it is not unreasonable to associate this phenomenon with a similar trend in the Spanish Property Market. In fact, our own experiences this year reflect it. We have seen a tailing off of Belgium, Dutch, French and German clients, almost certainly as a result of the EU slow-down. Yet, conversely, there is a significant return of British buyers, which can be attributed to the fact the UK economy is bucking the trend. With UK wage growth higher, inflation down and record employment levels, British property buyers in Spain are more confident.
Despite the chaos over Brexit, with chronic mishandling by parliament, the UK pound has, inexplicably gained strength against the Euro – as I write, it is trading at €1.18 to the Pound. This time last year it was at €1.13 to the Pound.
Buyers Are Making Low Offers!
For several months now, we have noticed a concerning trend amongst overseas property buyers regarding offers on property here in Spain. It began when we were experiencing a large increase in French, German, Dutch and Belgium buyers. It appeared to be quite normal for them to make very low offers on properties after viewings. In many cases, 20/30/40% below asking price and in some cases even lower. We spoke to fellow agents in many areas and they all agreed it was something they too were facing.
It’s quite typical for British buyers here in Spain to make offers around 10/15/20% below asking price, so the difference in the two types of buyers was noticeable, but since the New Year, British buyers have become tough negotiators too! It’s difficult to pinpoint the reason for such a significant change in behaviour. Getting these types of offers through is not an easy task for Estate Agents and is often quite stressful. We all hope things will correct themselves once we have managed to get Brexit out of the way.
Kenneth Whettall
Commercial Director
Fuente Alamo Real Estate/Murcia Coast & Country
Info@fuentealamorealestate.com
Tel 0034 968 598 173