With the summer nearing an end, it is traditional for the experts to look ahead to what property markets have in store in the final few months of the year, and a glance at market conditions in Spain suggest that the housing sector in the country is looking rather rosy, according to BBVA.
The banking group’s latest Spanish property market report forecasts that Spanish house prices will continue rising for the rest of the year, even if the recent recovery in the market loses some momentum.
There has been a lot of positive activity so far this year, with property sales, prices and building activity all increasing, and BBVA Research predict that this trend will continue in its latest Real Estate Observatory report.
The latest figures from the notaries show that building land transaction increased by 82% year-on-year in the second quarter of the year, albeit from a low base, which is a clear sign of growth in the Spanish housebuilding industry.
The Spanish property market recovery is being fuelled in part by improving mortgage conditions and a sharp increase in tourism which has pushed up demand for holiday homes along the Spanish coast.
However, BBVA has suggested that the second half of the year might not be as good as the first half, as there are signs that growth in the Spanish economy could moderate.
“Lower economic growth and what that does to consumer confidence is expected to knock some of the wind out of the sails of the housing market recovery,” said Mark Stuckin of Spanish Property Insight.
“Even so, BBVA expect new development to continue expanding on the back of stronger demand and the gradual disappearance of the new homes glut, at least in areas where there is demand, such as big cities and popular coastal regions [like the Costa del Sol and the Costa Blanca],” he added.