Home » HOME SALES IN OCTOBER 2020: Post-lockdown bounce wears off

HOME SALES IN OCTOBER 2020: Post-lockdown bounce wears off

The latest home sales figures from the National Institute of Statistics (INE), and the Association of Spanish Notaries, show the market turning down again in October, after a short-lived bounce.

Spanish home sales completed in October 2020, according to the Association of Spanish Notaries

There were 48,385 home sale completions witnessed by Spanish notaries in October, down 7.8% compared to the same month last year. Seasonally adjusted, the decline was 5.1%.

As you can see form the chart above, which compares sales with last year, 2020 got off to a modest start before plunging in the lockdown months of March and April, then started to recover in May. Pent up demand ensured sales growth in the third quarter, but the figures for October, with sales below last year, suggest that the bounce is over. Year-to-date (10 months) the market is 20% smaller than it was in 2019.

The next chart, showing the annualised change in sales each month, shows how weak and short lived the bounce was.

If you look at the 12-month rolling Y-O-Y change in sales (next chart) you can see how the market started losing impetus long before Covid-19 appeared, but the pandemic made the situation much worse. The Spanish property market was already slowing down due to home-made headwinds that I’ll discuss when the final number are released in Q1 2021.

October 2020 home sales according to the INE

Figures from the National Institute of Statistics (INE), based on sales registered by the Association of Spanish Land Registrars, show inscriptions in the Land Registry at 34,347, down 12% in a year, not including subsidised housing known as VPO. Plug the INE’s figures into the graphs above and you see a similar story.

Spanish home sales by selected region – October 2020

The regional picture in October was largely negative, with sales down the most in the Balearics, Madrid, and Barcelona. The big city decline might reflect a change in demand brought about by the coronavirus, with buyers shunning densely populated cities for healthier lifestyles in areas with more outdoor space. The declines in popular areas like Malaga (Costa del Sol) and Alicante (Costa Blanca) were partly due to the travel restrictions still in place. That said, the Costa Tropical, Costa de la Luz, and Costa Cálida in Almeria still managed to eke out small increases, perhaps because they are three of the least populated southern coasts.

Year to date, sales are down in all areas, as you would expect in a pandemic year like 2020 (final chart). Areas with big foreign markets like Alicante, Malaga, and the Valencian region, are down the most because of travel restrictions keeping away foreign buyers for most of the year.

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