Spain’s third city is now seeing steady gains and attracting investors following the fall of its property prices and the number of sales transactions during 2007’s property crisis, according to Lucas Fox Valencia.
Its latest market data shows property sales transactions in Q1 2018 increased by 20% more than the same period in 2017, while the number of foreign buyers increased from 10% in Q1 2017 to 33% in the same period this year.
As stated by Idealista, property prices in Valencia are currently less than half of those in Barcelona and Madrid on average, reaching €1,743 per square metre by Q1 2018. Prices in Barcelona were at €4,334 per square metre, and prices in Madrid reached € 3,540 per square metre during the same period.
Prices in Valencia have since then picked up, showing an annual growth rate of 13%. The districts most popular among foreign buyers – Eixample and El Pla de Real – saw price rises of 10% and 13% respectively.
The figures also showed that 58% of Lucas Fox buyers purchase a home in Valencia as a primary residence, while 25% buy as a second residence and 8% buy as an investment.
Valencia’s growing appeal is confirmed by recent government figures. The Spanish Registrars Association (Registro de la Propiedad) revealed that in 2017, 10% of total sales completed in Valencia were made by foreigners, compared to 6% in Madrid 9% in Barcelona.
Juan Luis Herrero, partner of Lucas Fox Valencia, said Valencia’s manageable size appeals to foreign buyers, along with the beaches to the north-east of the city where the mix of apartments and townhouses with communal pools and play areas make them popular with families.
“For those familiar with the city and its recent development, the current buzz surrounding it comes as no surprise,” he continued. “It is now a growing hub for business and innovation and home to leading companies such as Ford, BP, Mercadona and Caixabank.”
“Communications with the rest of the country and Europe are excellent – you can arrive in the centre of Madrid in less than an hour and a half on the AVE fast speed train whilst recent data shows that Valencia airport arrivals are up by 19% year-on-year to April 2018 with Italians, Germans and the British making up the biggest proportion.”
What’s more, the city has also seen a 5% rise in the number of turnkey home sales in 2017 compared to 2016. One highlight includes the Jardines de la Ciudadela project, 3 and 4-bedroom apartments currently promoted by Lucas Fox, which is situated next to the Turia Gardens. Prices start at €505,000.
Herrero explains that while the property recovery has been slower in Valencia than in Spain’s other two cities, he expects to see a noticeable change in the pace of the market over the next few years due to the increasing demand for and supply of new homes.
“Modern homes such as Jardines de La Ciudadela not only make an ideal primary or secondary residence but are also a great long-term and rental investment. Some of these homes could attract a rental yield of between 5% and 6%.”
He added: “It will only be a matter of time until Valencia becomes as internationally known as Barcelona and Madrid.”