Costa del Sol property is in demand
The property market on the Costa del Sol is showing clear signs of a continuing recovery, according to a report published by property portal idealista.
The report suggests the time from placing a property on the market to closing a sale is down by 50% in the 12 months up to May 2016. Also, the supply of new property has risen by 4.87%, year-on-year, to 15,555 homes, the first increase since 2007.
When looking at an apartment in a block the average time to sell has come down from 104.2 months (period May 2014 to May 2015), to 52 months, while for a single family home the time has dropped from 54.6 months to 22.5, in the 12 months to May 2016.
During the last year there has been a considerable increase in the construction of new property, with 49 new developments on the Costa del Sol alone, almost 69% more than in the previous 12 months. This is, the report suggests, due in part to growing demand for second homes and buy-to-let property on the coast, following seven years of very low construction activity.
Average Property
The average apartment on sale today has an area of 133m², with an average price of 1,680€ p/m², giving a final average cost of 223,050€.
Looking at villas/detached housing the average on sale today has an area of 425m², with an average price per square metre of 2,372€, giving a final average cost of 1,007,694€. The costs for an apartment have remained stable while for detached housing the prices have increased by 39.45%.
Despite Brexit worries, the report suggests that the British market is still alive and well and is still the main source of buyers for Spanish property, followed by Belgium, France, Sweden and Germany. It is worth noting that Russian demand is increasing significantly in certain areas.
Marbella remains the benchmark for the residential market on the Costa del Sol, but the town of Estepona has seen significant increases in interest in the area. This is partly due to the urban management plan which has seen a great deal of projects over the last few years in terms of urban regeneration.
It is also worth noting that there has been an increase in the demand for residential land on the Costa del Sol from financial institutions as well as private investors. In recent months some major deals have been concluded for the sale of residential plots as well as buying completed developments.
2016 – 2017
The report suggests that the next 12 months will see continued increase in demand for coastal property from foreign customers. This will help stimulate Spain’s economy as well as the banks who are improving access to finance for buyers, possibly increasing sales numbers by 6 or 7 percentage points.
Prices are expected to increase further, particularly on multi-family housing as new construction sees an increase of between 8 and 10% in places like Marbella, Estepona and Casares. In contrast, in areas with a high volume of existing stock, prices are likely to show a slight decline.
As the construction of new property in areas such as Marbella, Mijas Costa, and Estepona increases the volume of transactions for the purchase of residential land by investors, developers and private buyers is likely to increase.
Now is a good time to buy on the Costa del Sol!
