Property prices fell 4% in 2011

In 2011 the price of new properties in Spain fell by 4% bringing the average price down to 2,376 euros per square metre, and the cost of the average home to around 213,000 euros.

This is according to the Sociedad de Tasación (Valuation Society) who estimate that prices will continue to fall in 2012 after falling 3.2% in 2010 and 4% in 2011.

Although they predict further decreases they stress that in some locations the decrease may be less pronounced. “It is expected the adjustment will continue at the supply level offered in late 2008, adapted to meet a volume of demand lower than in previous periods,” they said.

Europa Press reported that during 2011, the average price of new housing fell in 48 of the 50 provincial capitals, while only one saw an increase and the other remained unchanged.

Of the capitals Sevilla saw the greatest decline at -8.3% followed closely by Ciudad Real at -7.8%.

Four provincial capitals (Barcelona, San Sebastian, Madrid and Bilbao), saw a price per square metre higher than the national average while in ten others  (Murcia, Cáceres, Badajoz, Pontevedra, Jaén, Lugo, Zamora, Tenerife, Avila and Ciudad Real) the average value fell below 1,500 euros.

There were 81,000 new builds registered in 2011 showing a decline in construction mainly due to difficulties in financing projects.

The Sociedad de Tasación also noted an increase in the number of properties between one and five years old that were vacant and still awaiting first occupation, being offered for sale by non-real estate professionals including credit institutions and private individuals.

There was also an increase in the number of properties being sold on a rent-to-buy option.


Spain is “most searched for” destination

This is according to SkyScanner who have released figures showing Spain is still the number one choice for British tourists.

In the list of top searched for countries from the UK,  Spain came out on top with the USA in second position. The top searched for cities and resorts list showed Malaga first followed by Alicante in second place and Tenerife in third proving that Spain has retained it’s position as the most popular tourist destination despite poor publicity surrounding the state of the economy.

In 2011 Spain came out on top of the Post Office Holiday Costs Barometer. The report looks at the overall cost of holidays by comparing 10 key items in 14 holiday resorts and it proved that Spain is Europe’s best-value destination, with prices at a four-year low.

The report suggest some of the reasons for Spain’s popularity are the high number of package holidays available from the UK, the large British expat community of more than one million and on-the-ground holiday costs remaining low for a fourth consecutive year. These are all points that have shown to be consistent in Spain and should all ensure top spot for a number of years to come.

Spain was also the most searched for destination in Germany, Sweden and Spain.

You can read SkyScanners full report here

Spanish unemployment continues to rise

Spanish unemployment
Queues grew again in December

The number of unemployed in Spain has risen for a fifth consecutive month resulting in a record number out of work as Europe’s fourth largest economy continued to contract.

According to the latest labour ministry figures unemployment rose 1,897 in December to 4.42 million, the highest figure since records began in 1996. This was however significantly lower than the increase in November when 59,536 people found themselves out of work.

Spain had seen signs of a recovery in the first half of the year but tourism and exports weakened towards the end of the year once again weakening the economy.

Union leaders and employers met with Labor Minister Fatima Banez last week after newly elected Prime Minister Mariano Rajoy asked both sides to reach agreement on changes to collective wage-bargaining rules and ways to resolve labor conflicts outside the courts.

At a news conference in Madrid State Secretary for Employment Engracia Hidalgo said “The figures for the number of registered unemployed for the month of December confirm the deterioration of the economic situation during the second half of the year.”

She added that the figures also point to the failure of the labor-market overhaul which had been implemented by the previous Socialist government.

2011 Round up

Merry Christmas
Merry Christmas everyone!

So it’s here again! Another Christmas on the Costa del Sol.

Although this is my seventh Christmas in Spain I never can get to grips with it. It’s been warm and sunny throughout December and it’s hard to get into the Christmas spirit when it’s not snowing and cold.

There are illuminations hanging in the streets and shop windows are adorned with trees, tinsel and the usual “grotto” displays but with the sun on your back it all feels out of place.

One thing I have got used to is not having to scrape ice off my car windscreen in the morning. Good luck with that my English friends!

2011 Real Estate Market

The real-estate market has suffered terribly during the last few years but has shown some small signs of recovery in 2011, nothing of significance though. It’s been tough for me to write anything positive over recent months, I hope I didn’t bring any of you down!

Some banks have begun lending again, property prices crept up slightly and Spain saw record numbers of tourists.

Spain elected a new leader – Mariano Rajoy – and I look forward to him doing some good work for the country. Let’s be honest, he couldn’t do much worse than Zapatero did! I hope he keeps the tax on new builds at 4% rather than reverting back to 8% and I hope he doesn’t increase property tax, there are rumours that he will, and this would be devastating for an already wobbly market.

Unemployment in Spain rose to record levels this year and urgent action needs to be taken to stop it continuing. A good suggestion I have for Rajoy is to stop charging a “self-employment tax”. In case you’re not aware, if you want to help yourself out of the crisis and take the initiative to start your own business the Spanish government will charge you around 260€ per month, every month, regardless of your earnings. So if you start a business today but don’t earn anything for the first three months you still have to pay the 260€ per month. It’s a stupid tax that discourages new business. There is no justification for it. You still have to pay income tax and social security on any earnings on top of this tax so what is it for exactly?

The banks in Spain are looking forward to a hard year too. They have assets to move, debts to pay and defaulting loans to claim. They have work to do and with government pressure on them to behave 2012 will surely be a year that the banking industry wont forget in a hurry.

My friends in the mortgage world have hinted at some good news coming early in the new year and I look forward to spreading some positivity.

I will also be publishing some interviews in the new year from people within the real-estate market including agents and developers and I’ll try for some councillors too.  If you think you have something to say that is relevant to the market, or you know someone that has, please let me know. I’m always looking for new content and this blog reaches thousands every week (which surprises me!) so send me stuff.

I am on holiday from 6pm today until Jan 3rd so there wont be many posts over the next 10 days. I will try to write some though and if anything important happens I will definitely post. However, not much happens in real-estate over the holiday so don’t hold your breath!

So I wish you all a very Merry Christmas and a happy and prosperous new year! See you in 2012!


Rental prices increase

Rental PropertyAccording to figures released by the National Statistics Institute (INE) the average price of renting a property in Spain increased by 0.9% during November, compared to the same month in 2010.

The increase in rental prices remains two points below the overall CPI which was at 2.9% by month end, reported El Mundo. Month-on-month, rental costs registered a variation of one tenth, which had risen this year by 0.8%.

In Navarre, the only region to register a decrease in rental costs, the average fell by 0.4%. The largest increase was in the Basque Country which registered an increase of 1.6%, followed by a 1.3% increase in Catalonia. An increase of 1.1% was registered in both Asturias and Galicia, followed closely by 1% increases in Andalusia, Cantabria, Castilla-La Mancha and Castilla y Leon

Surprisingly the costs in Madrid only increased by a mere 0.3%, while Murcia and La Rioja saw an even smaller increase of only 0.1%.

TINSA December House Price Report

TINSA have released a new Spanish house price report for December. You can download it here.

They summarise with the headline “The decline in house prices continues”.

The General IMIE index fell again in November to 1725 points to a year-on-year decline of 8% compared with 6.9% the previous month.

The cumulative decline from the top of the market in December 2007 has widened to 24.5 %.

This situation was also reflected in the market’s various segments, with “Capital and Major Cities” again recording the highest year-on-year decline of 9.7% , followed as in the previous month by “Metropolitan Areas” with 8.2% and the “Mediterranean Coast”, which echoed the decline in the overall market at 8%.

The remaining two areas fell by less than the national average.

The year-on-year decline for “Other Municipalities” was 7%, while in the “Balearic and Canary Islands” it remained at 3.7%.

The cumulative declines to November by area, from the top of the market, were:

  • Mediterranean Coast 30.4%
  • Capital and Major Cities 26.7%
  • Metropolitan Areas 25.9%
  • Balearic and Canary Islands 19.4%
  • Other Municipalities (not included in the previous categories) 21%.

New leaders for Gibraltar

Fabian Picardo
GSLP leader Fabian Picardo

Elections took place in Gibraltar last week and resulted in a new party being elected, for the first time in 15 years.

30 candidates were put forward for the 17 seats in the Gibraltar Parliament – 10 candidates each from the Gibraltar Social Democrats (GSD), Progressive Democrative Party (PDP) and an alliance Gibraltar Socialist Labour Party (GSLP)/Liberals.

The GSLP, under the lead of Fabian Picardo, secured a narrow victory taking 48.8% of the votes against the GSD’s 46.76%, bringing an end to the 15 year reign of Social Democrat leader Peter Caruana.

Spain’s newly elected PP party has congratulated Gibraltar on the result and said they are hopeful that the new leader will move Gibraltar towards a “permanent dialogue” between the neighbouring countries.

Liberal Democrats in the UK also sent their congratulations to Picardo’s party stating that December 8 was an historic day for Liberals in Gibraltar.

Gibraltar’s sovereignty is likely to be a major point of discussion for the new leader with the Spanish conservatives looking for a return to the 1984 Brussels Process, a negotiation between Spain and Britain in which Gibraltar had a voice, but no vote. However, Picardo insists that Gibraltar’s sovereignty is “not up for negotiation”.

He also promised to put aside party politics and focus on the things that are in the best interests of the country.

Relations have been strained between the two countries over recent years and has seen protests and the possibility of the Spanish border town of La Linea charging a “toll” for tourists heading for Gibraltar as they have to go through La Linea to get there. The mayor says the “through traffic” is not good for La Linea as the town hall is almost broke and many thousands of tourists pass through the town but few stop to spend money.

New construction falls 35%

construction in spain
Many constructions remain unfinished

In the first nine months of 2011 there were 127,207 newly constructed properties in Spain, representing a decrease of 35.2% over the same period last year (196,492), according to the Ministry of Development.

Of all the properties completed between January and September, 98% (124,731) were constructed by private developers and 2% (2,476) were government projects. With respect to the same months of 2010 construction by private developers dropped 35%, while publicly funded construction fell by 44.7%.

Among the private sector, corporations accounted for 86,259 properties showing a decrease of 41.6%, while private construction and communities accounted for 28,126 (-16.8%), and 6,154 (-6.4%) from cooperatives. The remaining 4,192 consists of other types of private development.

Meanwhile, the value of completed properties fell by 31.6% to 12,185.6 million euros. The finished house prices continue to follow the downward trend of recent years. In the whole of 2010 total constructions amounted to 257,443 which showed a 33% decrease from 2009.

Spain has now seen three consecutive years of falling prices. Since the peak recorded in 2007, when 641,419 new apartments were completed, the market has fallen by 60%.

World Travel Market opens in London

World Travel MarketThe World Travel Market (WTM) opened yesterday at the ExCel exhibition centre in London and will run until Friday 11th.

Luciano Alonso, head of tourism at the Junta de Andalucía, said that the region will take many positive statistics to the WTM in London. Andalucia had a record summer in terms or tourist numbers. The number of hotel stays increased by 10% this year, 1.4% above the national average.

Alonso said the positive figures were due, in part, to the success of last years WTM which was held at different venues including Manchester, Liverpool, Birmingham and Dublin.

The 2011 campaign entitled “Andalucía, welcome home”, will take Andalucía to Liverpool and Manchester while there will be a special event to promote the Andalucía tourism website, which will be held at the new Westfield Stratford City shopping centre.

The WTM will consist of some 600 stands representing destinations around the world, all attempting to attract more tourism for the coming year. The stand for Andalucía will cover 600 square meters and will include tables for meetings. The types of tourism Andalucía receives will also be on the agenda. The usual sun, sea and sand holidays will be promoted along with more traditional aspects of Andalucían culture plus golf and winter sports.

For full details of the World Travel Market, including opening times and event programme visit

Golden Book of Businesswomen of Marbella 2011

The presentation of the Golden Book of the Businesswomen of Marbella 2011 was attended by more than 200 guests this week

Marbella’s La Meridiana del Alabardero Restaurant hosted the event. The president of ‘Marbella te Quiero’, Oscar Horacio, presented the gala with entertainment provided by Doble Juego, Natasha Romanov and Paco Garcia.

There was also a fashion show by Patricia Nahmad, Manuel Spinosa, Impel and Opticabanus. Spanish ballroom dancing champions Jordi and Eva Mayral also put on a demonstration

Ms Isabel Noboa was the special guest of the evening. Isabel received an award representing the businesswomen of South America in the year of the centenary of the international women’s day.