Recently published data from Tinsa, the highly-esteemed Spanish property valuation firm, shows that the trend of increasing house prices will carry on into next year, with predictions putting this increment at somewhere between 5% and 7% over the course of the 12 months…
In summary, the property sector in the first 11 months of 2018 has seen significant advances on several fronts: employment creation, demand for residential real estate, purchasing activity (overall number of transactions), home values and mortgage approvals.
Even foreign investment in Spanish property – both residential and commercial – has been on the up, with total invested capital for the year due to be the highest in 10 years.
Tinsa’s analysis highlights the “consolidation” of prices next year, as opposed to vast price hikes, insinuating that advances will be, on the whole, more modest than this year’s. After all, this year has seen impressive positive year-on-year valuation figures, so the words sustainability and consolidation are music to the ears of prospective buyers.
Good news for prospective homebuyers is the current disparity between property values and rental increases. While home values have experienced a steady, positive surge in 2018, the rental market has spiked at various points over the course of the year.
This summer, for example, the year-on-year rental price increase for the second quarter stood at almost 16% and studies put the average economic strain on tenants as high as 40% of their monthly earnings compared to 30% the previous year.
Of course, this is great news if you are looking to rent out your Costa del Sol home in your absence. But if you are looking to make the move over to Spain for the first time and are considering whether to rent or buy, all signs point to now being the time to buy…
…Monthly rental payments are disproportionately high, banks are now more generous with mortgage lending, the recovery of the Spanish economy is going from strength to strength (2.6% in 2018 and forecast to be 2.2% stronger in 2019) and you will pay up to 7% more for your dream home this time next year.