Spanish property market showing signs of recovery
Posted by jamesdearsley on May 20, 2010
Spring is in the air as are signs of recovery. It has been a very positive start to 2010 and a complete contrast to the end of 2009. It was as if New Years Eve brought a torrent of positivity toward the property market; both UK and Overseas. It was first documented by the Spanish Ministry of Housing that sales numbers were picking up back in November 2009 and this has continued this year according to the latest figures.
It is very easy to get wrapped up in figures and these are sometimes questioned anyway. For example in March sales figures were up 9% against last year though this is pale in comparison to the 18.7% increase we saw in February. One major caveat we have to be careful about here, as is being banded about when analysing UK market figures, are that these are working off incredibly low base levels during 2009. This is why I also like to look at qualitative feelings as well.
During 2009 Spain was not a nice place to be if you were involved in the property business. Developers were down and fighting for everything they could and you could see the stress etched on their faces. With their sales distribution channels falling all around them with International Agents going out of business it had the direct effect on their own business. They were not having a good time of it and prices were being slashed left, right and centre. This meant that certain agencies, including my own, were having a field day especially if you were dealing with sales operations involved in the single currency.
Fast forward to 2010 and it is a different story, developers are becoming more confident as they see the market returning. It is starting in the Resale market which is a natural occurence in our business as the clients have confidence in buying something that is already there but developers know that it is only a matter of time until the off plan market becomes more attractive.
So lets go back to the facts again to finish. With the Euro at a 4 year low against the dollar this can only be a good thing for Spain (and other markets for that matter) and also sterling is getting stronger, though not as quickly. One thing is for sure, developers in Spain should learn a few lessons from this latest property crash. Trust and transparency will be key in building and ultimately selling their developments in the future. If they get that right the next wave of clients coming to Spain over the coming few years will be more than happy to buy their products.