Is time right to buy in Spain?

There’s no doubt that Spain’s property market has endured a difficult few years and residential prices in the country tumbled in the wake of the economic downturn. 

But now Knight Frank’s representative office in Spain, says buyer confidence in the market is starting to return

Barcelona based agent Lucas Fox notes that the fall in prime residental prices in Spain is begining to slow and as a result investors are sensing a potential turnaround in the market.

Data released by the agent suggests that prices in some of Spain’s most desirable areas have fallen up to 50% since the property crash of 2006/7. However, sales have begun to rise more recently as British and Scandinavian buyers return to the market.

• In Barcelona, the Costa Brava and Marbella, prices have fallen between 20% and 50%. In some areas, they may have reached the bottom.

• Property sales in Barcelona are up 13.5% from January to May 2013 compared to the same period last year

• Lucas Fox has seen the strongest two quarters of trading since the start of the property crash of 2006/7

• The luxury property market is doing particularly well, primarily in Barcelona, the Costa Brava, Ibiza and Mallorca where the average sales price of properties sold by Lucas Fox in the first six months was over a million Euros. In these key areas the property markets are still being driven by international clients

• Mallorca was the most popular tourist destination in Spain in the first half of 2013, with many British and Scandinavians returning to the market

• On Ibiza, prices remain buoyant and the demographics of buyers is changing with more young European buyers in the 30 to 40 year age group

Alexander Vaughan, co-founder of Lucas Fox, said: “The first six months of 2013 saw further encouraging developments in the property market in prime areas of Spain. In all regions we cover, the numbers of offers and sales completed were significantly up on the same period in 2012.

“It remains a buyer’s market with even the best properties transacting at 20% to 30% below their peak prices and sellers increasingly open to negotiation on asking prices. Our advice to potential buyers is to focus on location and quality.

“There are some great deals to be had and we think that in most areas, particularly Barcelona, the Costa Brava and Marbella, prices are at, or very close to, the bottom. We expect the trend of sellers lowering asking prices in line with buyer expectations to continue for at least the rest of 2013 and quite possibly the next couple of years.”