The latest figures on foreign demand from the Association of Spanish Land Registrars show no sign of an additional collapse in British demand now that ‘real Brexit’ has kicked in.
‘Real Brexit’, with all its restrictions on British citizens in Europe such as the 90/180 day rule, only became a reality on the first of January this year. Up until then we had been living through a type of ‘phoney Brexit’ in the transition period, when it wasn’t even clear what Brexit meant.
The question on my mind was what will ‘real Brexit’ mean for British demand for property in Spain? Will the more onerous conditions of living and visiting Spain hammer British demand or not? Personally, I was expecting to see a significant Brexit-related drop in British demand in the first half of this year.
But with the actual figures in hand, I can see no obvious Brexit-related plunge in the number of Spanish home sales involving British buyers.
True, the number of sales made to British buyers inscribed in the Land Registry was down 21.4% in the first quarter compared to the same time last year, but so were the numbers for France and German, all thanks to Covid. The British decline in Q1 can also be attributed to the pandemic, because it is more or less in line with the decline in other foreign markets. If the British decline were significantly bigger it would be possible to talk about a Brexit effect, but that’s not the case.
And a few other charts that all show the effects of Brexit and Covid, but no sign of an additional ‘real Brexit’ decline in Q1.
So, no obvious ‘real Brexit’ effect in the figures yet, but it might still be on the way. If there was a small surge in British buyers at the end of last year getting in before the Brexit deadline, that would boost the Q1 figures, delaying the Brexit slump until Q2. If there is going to be a ‘real Brexit’ slump, it will become clear in Q2 and Q3.
Whether or not there is an additional ‘real Brexit’ effect, there is no escaping the fact that Brexit has already taken a big toll since the referendum back in 2016. The next chart shows British demand in Q1 every year back to 2016. This year was almost 50% below 2016, some of that due to Covid, but most of it due to Brexit.