However, the real estate market in Spain did slow down in the third trimester of the year. In spite of this, the Spanish economy is growing at a rate several tenths above other countries around us (2.9%). Daza points out that the slight deceleration of the real estate market in 2016 has been influenced, on the one hand by the political uncertainty which has apparently slowed down investor decision making; on the other hand, it has to do with international factors which have cast some uncertainty on our well functioning economy, like our EU partners.
One of the events which had the greatest impact was Brexit. Foreseeing the important necessity to manage potential currency exchanges, Gesvalt decided to work in the London market, to work more directly with the investment community and to offer them our full range of services. “We think that Spain will be a very attractive market for investors during the next few years, and we will be able to gather the fruits of the current uncertainty in the British economy. Among the benefits which, with good exchange management on our part, can ensue are: to direct investors from the United Kingdom to Spain, to relocate bank headquarters and corporations away from London, to refocus all the capital destined for investment managers, from the UK market to other EU members like ourselves”, explains Sandra Daza.
Perspectives for 2017: Profitability when the product is scarce
It is expected that macroeconomic data on residential demand will continue to develop in a positive way during the following trimesters, though in a more moderate way: a cycle of expansion, better employment, reduced financial costs and profitability faced with alternative investments.
For Gesvalt, the favourable conditions for the real estate market will continue in 2017, when total demand for housing should return to 450,000 units. (Source: Servicio de Estudios de Bankinter).
In the same way, house prices ended the year on a positive note, with an average annual increase of approximately 2.5%. An increase which, in 2017 will be about 3.5%. (Source: Servicio de Estudios de BBVA).
In spite of this, recovery will be very unequal in geographic terms. While in some areas the rate of price growth will be well above average again in others, however, they may vary considerably. Several consecutive years of growth in house sales will transfer finally and directly onto constructional activity.