The glut of new homes for sale in the two coastal provinces of Almeria and Castellon is more than double the national average, reveals a recent report from the Bank of Spain.
How big is Spain’s new home inventory, as a percentage of the overall housing stock? The answer is 2.1% as a national average, according to the Bank of Spain (BoS). But in the Valencian coastal province of Castellon (home to the Costa del Azahar) the proportion rises to 6.5%, thanks largely to a glut of holiday homes. In the Andalusian province of Almeria, the proportion is 5.5%.
The BoS calculated the proportion of new homes for sale as a percentage of the housing stock using data from the Government (Fomento) showing there were 535,734 new homes for sale at the end of 2014, which represents 2.1% of the total Spanish housing stock.
Spain’s new housing inventory fell by 5% in 2013, and has fallen for five consecutive years from a peak of 649,780 in 2009. But despite shrinking for five years, Spain still has a monumental glut of new homes for sale, a testimony to the insanity of its building boom last decade.
Though classified as “new homes” the reality is many of them are far from new, having been finished years ago. “Never previously sold” would be a more accurate description in most, or at least many cases.
In Castellon province there were 27,275 “new” homes for sale out of 422,684 homes in the province, and in Almeria 21,728 out of a total of 397,507. Both regions depend on tourism, so many of these properties were built to be sold as second homes, explains the report from the BoS.
Castellon and Almeria may have the biggest inventory for sale as a percentage of their housing stocks, but in absolute terms, Madrid (41,540), Barcelona(44,955) and Alicante (44,180) had the biggest inventories of new homes for sale at the end of 2014. Madrid has a total housing stock of 2.9 million homes, Barcelona 2.6 million, and Alicante 1.2 million.
As a proportion of the housing stock, the percentage of new homes for sale in Madrid was 1.4%, Barcelona 1.7%, and Valencia City 1.8%. The Government describes the new housing inventory in Spain’s three biggest cities as “balanced” given the size of the local housing stock.
At the other end of the scale are the provinces of Cáceres, Badajoz y Cantabria, where there were no new homes left for sale by December 2014.
One of Spain’s big problems is the mismatch between supply and demand for new homes. “The geographical disparity between the inventory of unsold homes and the creation of new households, means some provinces have a glut and others a shortage of supply [of new homes],” explains the BoS.