Overseas buyers help Spanish market to end year on a high
2012 has witnessed a perfect storm of negative news for the Spanish property market. Prices are down year-on-year by 15.2% according to official statistics and the newly formed bad bank has led to a frenzy of price cutting by the savings banks.
The good news though is that on an annualised basis, Spanish property sales have increased for three months in a row as buyers have brought forward their purchases to take advantage of tax breaks which end in 2012.
According to the National Institute of Statistics, 22489 sales were made in October, an increase of 14% on October 2011.
Figures from the Ministry of Public Works (Fomento) tell a similar story. Q3 transaction volumes appear to have stabilized compared with sharp falls earlier in the year. The biggest increases have come in coastal areas suggesting overseas buyers are snapping up property to take advantage of lower prices, attractive payment terms and the current tax situation. Take a look at the areas in green on the table created by Spanish Property Insight .
Will it last? Nationally, the answer is probably no. The tax situation is merely boringly forward future purchases so a New Year hangover is likely. The international property market in Spain however is a different beast. Climate, convenience for Northern European buyers, falling prices and attractive payment terms are a compelling combination.
In a desert of gloom, the international market will be an oasis. Just don’t expect as much to drink as 2007. Luckily there won’t be as many camels.