Spanish property prices have hit rock bottom and are likely to start rising as the economy kicks in with the best performance for a decade.
Not so long ago, Spain was one of the poor men of Europe, taking a begging bowl to the European Union for billions of euros in handouts.
Now, the struggling economy has revived to register 2.6% GDP growth this year, ahead of big guns like the US and Germany, according to the International Monetary Fund.
A general feelgood factor, improving wages and more jobs has triggered more demand for homes and mortgages, says research by international property consultants Knight Frank.
Value for money
The study also argues expats will find value for money in the Spanish housing market.
Mortgages are at competitive rates and tourism hit a peak in 2016 after some time in the doldrums.
“In 2017, two key trends merit the attention of second home buyers. Firstly, the diversification of demand. British buyers, down 28% in the year to the end of the fourth quarter of 2016 are being replaced by Dutch purchasers, up 58% during the same period, along with Belgian, Scandinavian, Latin American and Turkish buyers,2 says the Knight Frank report.
“Secondly, Spain is witnessing the rise of the urban resort. Both Mallorca’s capital, Palma, along with Barcelona, Valencia and Malaga are undergoing a renaissance as buyers seek to combine a vibrant city centre and all it offers in terms of culture, cuisine and retail with the benefits of a beachfront and marina.”
Leading expat markets
Spain has four leading markets:
- Madrid, the capital, which saw prices rise 3% last year, which mainly attracts expats from Venezuela, France, Switzerland and Mexico
- Barcelona, which saw a 6.6% increase in prices and a 25% rise in rents in three years
- The Balearics, which are a favourite with British expats, Germans, Dutch and Belgians, where prices have risen by between 2% and 2.5% in a year
- Marbella – Favoured by the Dutch, Germans, Russians and Scandinavians, where property prices have gone up by 2.9%.
“Prices have largely reached their floor across most regions with a lack of new supply helping to support values,” said the spokesman.