Moraira and Javea News

Brexit update Feb 2018

Recent figures show that the number of sales involving foreign buyers grew 15.6%, compared to the same period in 2016. The figure is even more prominent when you consider the number of British buyers for Spanish property dropped by 23.6% year-on-year.

Notary figures reveal that during 2017 cash buyers are still in the majority at 55%. It is interesting to note that the regions with the highest proportion of cash buyers are also the regions with the largest number of foreign buyers. Local buyers are more likely to use a mortgage. According to the Ministry of Public Works in Spain, Alicante province has the highest percentage of foreign buyers in Spain at 48.25% in Q1 2017

Overall the Spanish property market increased by 14.4% in the first three months of 2017 with domestic demand for property up by 14.2%. This is reassuring news. However, the European Union is currently addressing its greatest challenge to date, Brexit.

When you consider Brexit and the fall in the value of sterling, you might be surprised to learn that British investment in Spanish property for 2017/Q1 was still the biggest group of foreign investors at 14.74% with France second at 10% and Germany close behind on 8%. It will be interesting to see whether this mix fluctuates after the Brexit negotiations have been concluded, because there is no doubt that this issue has had a significant impact on UK buyers when you consider the year on year figures.

Brexit has left the pound significantly weaker against the euro and has created
uncertainty particularly for those looking to permanently relocate to Spain. For people
wanting to buy a holiday home or investment property, the situation is largely the same
as before.

If you are considering purchasing a property please contact us for advice. Contact Us

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Posted by on Saturday 17th February 2018

Investor Perspective

The past sixteen months have been exceptional for property sales within Spain, especially in Javea & Moraira. This demand has stimulated price increases of 6.3% during the first quarter for 2016 year on year, according to Eurostat, the European Union’s Statistics Institute. This is the largest increase since the third quarter of 2007 when we had the Spanish property boom!

After six years of price reductions we have now had eight consecutive quarters of price increases. Towards the end of 2015, data shows property price increases of over 8.5%. 2016 has continued with price increases. On the face of it, it would seem that prices have certainly recovered well from the price reductions throughout the crisis years.

We must be mindful that it was the low prices that attracted the buyers, especially UK buyers when sterling was stronger. This encouraged confidence and stimulated further growth and consequently prices have been increasing but for how long this will continue no one knows. Demand for property looks like it will continue as investors scramble to find safer investments. This means there is still some upside to price increases before it levels out.

Since Brexit happened business has been surprisingly good with UK buyers, however, the reality of the uncertainties we face leaving the EU are just about kicking in as investor confidence in the UK remains low, hence the value of the pound has recently plummeted. Whilst there are many eurozone countries still buying property in Spain, the UK has historically made up a massive 15% of total foreign property purchases and at least 20% of the local Moraira/Javea market, which has attracted many British investors for the past 30 years. I expect some UK buyers will be deterred by all the uncertainties surrounding them but there will always be many Brits buying in Spain regardless. This was proven during the 2008 crisis.

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Posted by on Saturday 15th October 2016

Rental Law Spain

The new Spanish rental law is now obligatory and worth knowing! This is a scanned document from Abogados Romeu & Partners of Moraira. We will be advising all past and future clients of the new rental law. For further information please contact a legal adviser.

See Here:New Spanish Rental Law Valencia Region


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Posted by on Thursday 10th March 2016

Spanish Property Sales update Q1-Q2 2015

Statistics from the National Statistics Institute.

Property investment in Spain continues to grow, increasing by 5.1% for Q2, helping to expand the Spanish economy by 3.1% during Q2 year on year. Employment in the sector has risen significantly by 9.2%. Job creation is rising at its fastest pace so far this century!
The total amount of wealth created in the sector has also been on the rise and was up by 5.8% in Q2. This is the largest increase since 2001. Driven by greater demand for properties together with increased employment in the sector.

Property prices are up by 5.1% year on year for Q2, having registered a 2.65% increase overall year on year. The correction in prices during the crisis topped out at an average decrease of 30% but this is now 29% signalling the market has already bottomed out on average.

Property sales so far for 2015 are up a massive 11.12% year on year. The increased sales were mainly due to the increase of resales up by a substantial 43.56% whilst new builds decreased by 39.61%.

The Valencia Community were one of the best performers in property sales taking a 10.1% slice. According to the Spanish land registry, foreign buyers made up 12.82% of all property purchases made in Spain during Q1. Sales have been primarily driven by the increase of British buyers, up a massive 37.3% year on year. This means British buyers made up 19.85% of all foreign purchases, meaning one in five buyers are Brits!

All this positive news means property stock has been selling well, especially in the Valencia Community. In Javea and Moraira which has become extremely popular with the more discerning buyer, well priced quality property stock has been pretty much stripped out up to 350,000 euros. Most of what is left behind are projects in need of modernisation. This is leaving property agents with a major problem because it is not being replaced at the same pace! Current demand in this price band has overtaken supply, consequently you see nearly every agent advertising for more stock with clients waiting! All in all well priced property is getting very hard to find but fortunately, we have our finger on the pulse!

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Posted by on Sunday 11th October 2015
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