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Spain’s New-found Economic Prowess Sparks Property Market Growth

Having exited a six-year downturn, Spain is on the up

featured in Property news Updated

It is on course to become the largest economy in the eurozone – overtaking the UK and the United States. The nation has posted seven consecutive quarters of growth and its property market is mirroring this optimistic outlook.

The latest quarterly bulletin issued by the Spanish Council of Registrars showed a massive uptick for Q1 with just over 9% more residential properties changing hands over the same period in 2014. 12.22% of these homes were bought by foreigners – again up 9% on Q1 2014. UK nationals top the non-Spanish buyer chart, unsurprising given their long-term affection for Spain and the current favourable pound-euro exchange rate, followed by French, Germans, Belgians, Swedes and Russians. The Registrars also reported a 2.65% rise in average price per square metre over the last 12 months. Spanish property portal Idealista concurs citing the Balearics amongst the top three Spanish regions for sharp price rises in April.

“More sales at higher prices, this is exactly the news we want to hear in the Spanish property market,” says Alejandra Vanoli, Managing Director of Mallorca Sotheby’s International Realty. “The Balearic Islands reported some of the lowest house price falls in Spain during the six-year crisis and are now posting the fastest and highest rises. We expected this as the Islands are supported by huge numbers of tourists, a multi-national house buying population - Calvia alone has 19,000 non-Spanish residents from 100 different countries - and a strong appeal to the high-end with luxury hotels, restaurants, beach clubs, golf courses and marinas supporting a growing superyacht industry. This year we are selling more houses than ever and for us in Mallorca, the future is very bright.”

Glynn Evans, Managing Director of the Ibiza Sotheby’s International Realty office shares Alejandra’s enthusiasm, “Over recent months Ibiza has received an unprecedented number of positive mentions in international media by respected journalists. This beautiful Island is becoming discovered by the world’s most discerning and investment is pouring in to secure its future. An abundance of luxury has already landed: exciting culinary business ventures from multi-Michelin-starred chefs, supercar and powerboat championships, 70-metre-plus berths for the finest private megayachts and several new unbelievably cool five-star hotels. I am certain the best is yet to come.”

At the end of April, the Bank of Spain confidently declared an end to the property crisis. Its Director of Studies, José Luis Malo de Molina, said that "the adjustment in the housing sector, in principle, is complete" and “the process of price adjustment, in principle, has already bottomed out”. In short, Spain is now in the business of recovery.