According to figures released recently by the Bank of Spain, foreign investment into property in Spain declined significantly in 2006. The bank’s figures indicate that the amount spent by overseas purchasers of Spanish real estate dropped by around 14% year on year during the first nine months of 2006 compared to the same period in 2005.
In contrast to this seemingly negative data, currency specialists HIFX were recently reported as saying that a significantly large percentage of their business is still wrapped up with British buyers conducting property transactions in Spain; so all this begs the question ‘who’s still buying property in Spain?’ Are investors still keen on the market, is it retirees or holiday home hunters making up the bulk of buyers and why, despite the British love affair with Spain, has the annual amount spent on Spanish property seemingly declined?
The fact of the matter is, Spain is an evergreen property hotspot – it has everlasting tourism appeal meaning that there will always be demand for rental accommodation, it offers fantastic and affordable accessibility and is a nation top of every cheap flight operator’s list for expansion purposes meaning that more and more areas of the country are opening up for exploration.
What’s more, the tourism market in Spain has not been affected by the emergence of alternative short haul holiday locations such as Bulgaria and Croatia and annually the tourism market increases by almost 5%. So anyone considering making an investment in overseas property could do far worse than buy a home in Spain.
However, the emergence and promotion of alternative property investment markets where there is a much lower entry level than Spain - which let’s face it is expensive when compared to the likes of Cape Verde, Morocco, Egypt, North Cyprus or Turkey – and where the potential for a far faster return on income is believed to be evident, combined with the overall hype in the media about buying overseas has led people away from considering making an investment in Spanish property.
So, who’s still buying a property in Spain? Well, those who are still supporting the real estate market in Spain are those in search of a secure long term investment, who want a retirement home in the sun or who desire a holiday home, within easy reach, in a desirable and known location.
Of these buyers, those looking away from the holiday hotspots are finding that an overall slow down in the Spanish property market means it’s a buyer’s market going in to 2007 and negotiations can be entered into even with vendors of brand new property stock. Despite many being negative about the property prospects in Spain in 2007 we believe Spain still makes a great long term location for property price appreciation and it certainly makes a great location for a wonderful summer sunshine holiday home that all the family can use and get access to cheaply and easily.
