Spanish property poised for 14% sales growth, 5.5% price increase in 2018, says Spanish Property Evaluation Society

The aptly named Spanish Property Evaluation Society has this week done exactly what it says on the tin and, well, evaluated the Spanish property sector.

The society forecasts an increase in sales of 14.1% in 2018 compared to 2017, with prices rising nationwide by an average of 5.5%…

These are accurate projections that mirror other forecasts made by various real estate experts in the Spanish property sector. The society’s confidence stems from its analysis of the National Statistics Institute’s (INE) housing price index, which found that the 6.7% increase in prices in 2017 compared to the previous year was the largest increase since the index was first introduced in 2007.

Last year, Spain’s property market outperformed already-ambitious expectations, and while most experts tend to agree that this year the growth will not be quite so strong, there is still uniform agreement that the sector is going to continue strengthening.

“The market will continue the recovery started two years ago, although it still has a relatively long stretch ahead to reach the desired cruising speed,” said a report by the Spanish Property Evaluation Society.

The society also expects mortgage lending to gather pace this year, with the volume of mortgage approvals on course to increase by a further 9.4% on 2017’s figures. This is below the anticipated growth in home sales, and the society explains why: “The relationship between mortgages and transactions – there will be around half a million operations at year-end – remains healthy. We are not talking about a market that is being heated up by the financial sector,” Juan Fernández-Aceytuno, CEO of the society, remarked.

In short, the CEO believes that banks are putting in extra rigour and care before deciding to approve mortgages – a development that the market has long been crying out for, and is now common practice.

Further, the Spanish Banking Association has spoken about the improving relationship between the banking sector and the real estate sector. In the past few months, the association noted, some 60% of house sales have been made possible via a mortgage loan – a figure that reflects the confidence both industries now have in each other.

The amount of ‘bad loans’ on the books of Spain’s banks has also fallen 13.87% in the past year, further reflecting this trend.

More widely, Spain’s ongoing economic recovery is having a positive impact on the outlook for the country’s property sector, Fernández-Aceytuno confirmed. “If the global economy continues to grow as it has up to now, the positive trend in the Spanish property market will continue,” he said.