Spanish home sales rise for the first time in 4 years, in volume terms at least
Excluding social housing, there were a total of 391,296 residential property sales in 2010, up 5pc on the previous year, according to the latest figures from the National Institute of Statistics (INE).
As you can see from the following graph, this is the first time the market has increased in the last 4 years, though compared to 2007 the market was still down by 45pc.
So much for sales volume, what about value? According to Tinsa, a leading appraisal company, Spanish property prices fell 5pc in 2010, so best-case the market stagnated in value terms. If Tinsa’s figures understate price falls, as I suspect they do, then the market shrank in value terms in 2010, by a few percentage points or more.
The following graph shows how all the annualised growth last year took place in the first 8 months, before higher taxes on property ownership kicked in.
Here we see how both new-build and resales gave up the fight towards the end of the year.
And here we see a breakdown of sales for selected regions. Catalunya and The Balearics did best, whilst Castellón (Costa Azahar) did worst.
And finally, a table with transaction figures giving a 4-year comparsion.
With the increase in transactions, much of the Spanish press is reporting the market has turned a corner, though there has been no real analysis of the figures. For example, how many debt-for-property swaps were counted as sales? Did the market really grow when swaps are removed from the figures? I am sceptical.
Nevertheless, my feeling is that we are slowly reaching something of a bottom, at least in transaction terms. Barring any macro-economic shocks, 2011 will be the same or slightly better than 2010 for the overall market, though nothing to write home about.
As far as holiday-homes go, the best quality segments of the second home market will be subdued but steady, whilst sub-prime holiday-home product and locations will suffer another year without any meaningful demand.
Let’s see what happens.