New research by a sales company sheds light on the profile of domestic demand for Spanish property.
71 per cent of Spanish property buyers last year were investing in their main home, finds research by Básico Homes, a company that specialises in selling bank repossessed projects, mainly to local buyers.
Of the remainder, 17.5 per cent were buying a holiday home, and 11.5 per were looking for property as an investment.
First-time buyers, called “household creators” by the report, were the biggest group of buyers, with 22 per cent of the market. Their average age was 31 years, and average budget was €90,000, slightly above the average property price of €85,000, according to Basico Home’s sales last year.
The biggest change in buyer profiles last year came from people switching from renting to buying, with this group making up 21 per cent of the market, with an average age of 37 years, budget of €95,000, and mortgage LTV of 73 per cent.
Holiday home buyers made up 16 per cent of the demand handled by Basico Homes, with an average age of 48, budget of €87,500, and LTV of 55 per cent.
The remainder of the market was made up of buyers changing homes (16 per cent), property investors (11 per cent), and “prime buyers” on 2 per cent.
Generally speaking, the average sale involved a property of 105 sqm costing €97,500, to a 40 year old buyer using a 70 per cent mortgage. Almost 90 per cent of buyers completed within six months of starting their search.
Rafael Valderrábano, head of Básico Homes, voiced concerns that investment demand might be leading people to jump to the wrong conclusions.
“The macro data reflected in official statistics about Spanish property purchases hides the reality of the market,” he explains. “Throughout 2014, many investment transactions took place in which the purchase was not made by an individual. Over the last few years, the number of purchases made by investors has experienced an important rise, which is excellent news, but when those properties are put on the market again, they do not reduce the actual stock. In 2013, they accounted for 22 per cent of purchases, more than 68,000 properties, a percentage that may well have risen in 2014”.