The head of international real estate consultants Knight Frank in Spain forecasts rising property prices for at least the next three years.
Real estate asset prices will rise by between 5% and 6% per annum until at least 2019, forecasts the British head of Knight Frank in Spain, Humphrey White, in comments to the Spanish property portal Idealista.
Increasing prices at this rate are “sustainable”, I read, considering that prices are rising by 20% year-on-year in another post-crash market like Ireland.
Spain’s economic recovery and pent-up demand for all types of property like homes, offices, retail space and commercial property will help drive the rising market.
“In recent years there has been very little speculative promotion, which explains why we have an obvious lack of quality stock of some kinds of assets in some areas, and demand that is on the rise,” explains White. “Spain is living through a unique moment (leading economic growth in Europe) and continues to offer opportunities in traditional sectors like real estate and banking.”
White points out that it is difficult to talk about a homogeneous property market encompassing residential and commercial, not to mention big cities and secondary locations. Nevertheless, the overall picture is sufficiently attractive to forecast sustainable growth that attracts foreign investors and multinationals, he argues.
According to the latest global reports by Knight Frank, Barcelona and Madrid are amongst the top 20 world cities preferred by the mega-wealthy for living in, and Madrid was in seventh place for foreign investment, ahead of cities like Berlin and Singapore.
“We have a great opportunity to attract companies because we offer what many of them are looking for: good quality properties, airports close to city centres, and highly qualified professionals.”
That’s what I read at Idealista. But based on my recent conversation with White, I assume most of his comments were made with office and commercial property in mind, rather than residential. Even so, it’s noteworthy that the head of Knight Frank in Spain is optimistic about the Spanish property market for the next three years. Let’s hope he is right.