Spanish House Price Index

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House price news for buyers in Spain

An informed assessment of what is happening in Spain in terms of house prices is often difficult as there is no one set index or reporting structure in place.

The most robust of the options for monitoring of what is happening to prices comes from TINSA one of the country’s biggest valuation companies who have been monitoring prices per sq meters for over 10 years.

TINSA issue data each month and break down their overview of prices from data complied during the month from valuations they have undertaken. The information is limited in scope because of the number of actual properties the data relates to, but it does give a good general indication of what is happening on a regional basis against historical values.

What did Januarys TINSA figures show.

Unlike other data issued this year, which indicated a small increase in the sale price of properties in Spain the TINSA report for January showed another month of declines in average piece per square meter. The decline however has slowed significantly.

Overall nationally prices fell by 7.2% in comparison to December 2013. Against last years figures for the same month the figures show an underlying improvement as in January 2013 prices dropped by 13.8% from December 2012.

The Coastal areas and Canaries and Balearics held up the strongest with the smallest declines in Spain. Coastal areas fell by 4.8% and the Islands by 6.9% in comparison to Madrid and the major cities where the fall was 8.4% in comparison to December 2013.

The figures relating to the tourist areas of Spain are perhaps of no surprise as those most likely to be considering buying in Spain are the International buyers or the more affluent Spanish looking for holiday homes. The resident market remains subdued due to high unemployment and concerns on job security which continues to dog the Spanish Economy.

What are the current pricing levels

In the major areas of interest to International buyers prices per square meters are now sitting below 2004 levels and are very close to 2003 levels. If the current trend continues it can be expected that prices will bottom out at 2002 levels before starting to rise again.

At the peak in 2008 average prices per square meters in Coastal areas was € 2.537. In the month of January 2014 this had dropped to € 1.405. In 2002 this figure was closer to € 1.200 showing we may still have a little way to go.

What the data does not effectively breakdown is what may happening in certain pockets of Spain nor what is happening within different types of property. Where there remains an oversupply of type of property or high density of vacant property prices may still be falling at a fast rate of knots which skews the overall averages.

Anecdotally the picture seems to be different in some areas and for some types of properties.

Information obtained from selling agents and Lawyers in Spain suggests that in the Costa del Sol, the Islands and the Costa Blanca activity from International buyers is high in the first couple of months of this year. For instance 35% of all buyers in the Andalucía region were non residents compared to 17% as a national average.

General enquiry levels are up and unlike other blips we have seen the enquiry level seems to be feeding through to offers and completions.

Offers are often at up to 30% below the current asking price but at the quality end of the market and in sought after areas like Marbella we are starting to see close to the asking price being achieved for those selling in Spain.

Should I buy in Spain now

The evidence is pointing toward a bottoming out of prices in 2014. Future growth will no doubt be slow and in small steps but we may be reaching a point where those buying in Spain will obtain the cheapest prices we have seen for over 10 years.

Presently the pound is holding up well against the Euro which is also encouraging for buyers in the UK.

A sensible offer for the property of interest seems to be the name of the game and 2014 it may well be the right year to bite the bullet for those who want the holiday home in Spain but have put off buying until the uncertainty in Spain had settled.

Financing is also improving with Spanish Banks starting to provide new products meaning buyers can start to shop around for best buys on Spanish loans.

 

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