After years in the doldrums there are now some signs that the crisis in the Spanish real estate sector may be easing, although a full recovery is still a distant prospect.
Mikel Echavarren, the CEO of the strategic and financial consultancy IREA, one of the most respected authorities on the housing market, is increasingly optimistic about the outlook, and believes that recent developments such big investments buy international funds point towards the recuperation of the Spanish housing market with help from foreign capital.
One of the principal factors behind this renewed optimism is the return of international investment funds to the market as they look to take advantage of what many consider to be bargain property prices, particularly in Spain’s major cities.
The main types of purchases that these investment funds are involved in are of subprime mortgage debt, banks’ property management divisions, buy-to-let social housing and portfolios of repossessed housing. Funds are also starting to look at partnerships with Spanish developers with the aim of investing in specific geographical areas and property types.
Statistics regarding purchases by individuals are also interesting, in the first semester of this year 17% of the total purchases of Spanish property were made by foreigners and 60% of all purchases were made without mortgage finance underlining the preeminence of the cash buyer in today’s market.