The number of foreigners buying a second home in Spain collapsed in 2008, falling by 59% to a measly 3,691 sales, according to the latest statistics from the Ministry of Housing. Compared to 2006, when non-residents bought 17,212 second homes in Spain, sales were down by a whopping 79%, giving investors a chance to observe how risky the overseas property investment game really is.
Andalucia, home to the Costa del Sol, the Costa Tropical, and the Costa de Almeria, was still the most popular region for non-resident buyers, with 1,415 sales in 2008, down 52% (and 78% compared to 2006).
The Valencian Region was next, with a risible 778 sales in 2008, down 58% on 2007, and 83% on 2006. This latter figure shows how far Valencia’s holiday home industry has sunk in just 2 years. The Costa Blanca accounts for almost all holiday homes sales to foreigners: there were just 23 sales on the Costa Azahar in 2008.
The pain was spread fairly evenly around Spain’s popular southern coasts and islands, but Murcia was the hardest hit by the falling numbers of non-residents buying property in Spain. Sales in Murcia fell by 86% last year, to just 270 homes, whilst the supply of holiday properties built with foreigners in mind, typically on golf courses, continued to burgeon.
Sales fell in the Canaries by 39% to 475, in the Balearics by 51% to 221, and in Catalonia, home to the Costa Brava and Costa Dorada, by 49% to 193.
In Teruel province, once tipped on British TV as one of the top 10 overseas property investment destinations, sales exploded by 150%, rising to a mind-boggling 5 sales in 2008, up from 2 in 2007 (but down from 8 in 2006).