Introduction:
The prospects for the real estate sector in 2017 are very encouraging . The market recovers and brings with it price stabilization, increased demand, and moderate growth in employment and the economy. At fotocasa, we have spoken with some experts to find out what the trends in the real estate sector will be in 2017 .
Growth moderation and price stabilization:
During 2016, the residential market consolidated the process of growth and stabilization of prices. The evolution has been very uneven in the different Spanish locations, but the major capitals, such as Madrid and Barcelona, and the Costa del Sol, Alicante, have stood out. Balearic and Canary Islands.
According to TINSA , the outlook for the economy and employment is positive , although they will grow at a more moderate pace in 2016. At TINSA , they foresee a stabilization of prices to which the country as a whole will progressively add, and which will coincide with a moderation in growth in big cities. On the other hand, they predict that the evolution of prices will be influenced by rents, and that the upward movement of interest rates could redirect investment towards assets other than housing.
Read More about Location Map of Avalon City
According to Funcas forecasts , the GDP growth forecast for 3.2% in 2016 will decrease to 2.4% in 2017. In addition, it also contemplates a moderation in terms of employment, which will go from growing to 2.8% in 2016 at 2.1% next year.
Meanwhile, Beatriz Toribio , responsible for studies fotocasa , a price level, says that if the reopening of the tap of credit and the current context of low interest rates remains, "the rebound in prices now focuses on Madrid and Barcelona and certain tourist areas of the coast will extend to the suburbs and to other areas of the country ”. But "we should not expect large increases because the trend is towards normalization. We are recovering part of the land lost during the crisis and in some areas with a large stock and low demand for housing, this improvement will not yet be noticed in 2017 ”.
Regarding demand, if the employment market accompanies, the volume of sales operations will continue to grow and the environment of 450,000-470,000 sales operations will be reached. "In 2017 we will confirm that the recovery in the real estate sector is being slow and moderate, but constant," says Toribio.
The APEI (Professional Association of Real Estate Experts), agrees with previous opinions and predicts that the upward trend in prices and sales in the real estate sector will continue in 2017 , with a "slight" increase in prices and the same volume of sales. or "even more". The president of the association, Oscar Martínez, highlights that the prices adjust in general in all the autonomous regions, progressively at the pace of the economic recovery, and the new promotions that are planned are made according to "real needs".
On the other hand, according to the Statistical Yearbook of the Spanish Real Estate Market 2016 by RR de Acuña & Asociados, the behavior of the market is not homogeneous for all areas and is progressing at different speeds depending on the geographical area, even registering large mismatches between supply, demand and stock. , which cast doubt on a price expansion in part of the market.
“The housing stock has been dissolving rapidly in the past two years, and that seems to continue to be the trend for the coming periods. Now, the question is to analyze the behavior of demand to see if this situation will be sustainable over time ”, they affirm from Acuña & Asociados.
Finally, Gonzalo Bernardos , director of the Master in Real Estate Consulting, Management and Promotion at the University of Barcelona and Professor of Economics at the same, declares that 2017 will be a very good year for the sector.
"It will go very well practically in all places, the price increase will be 13% and the sales increase will probably be 25%," says Bernardos. In addition, he predicts that the profit margin per unit sold will increase and more will be sold, and recalls "that this will not happen every year."
The rental price will continue to rise:
Regarding the rental market, the head of fotocasa studies predicts that the rental price will continue to rise, especially in cities such as Barcelona, "where we are currently registering increases of 14% year-on-year and that trend towards recovery it will continue to be noticed ”. In addition, he points out that, although the market offers good opportunities and financing, there are still many people who cannot afford to buy a house due to economic and labor stability, so this year the evolution of financing and the market will be decisive. of employment.
“Despite the return of credit and the stabilization of prices in merchanting, the rental market has registered a strong dynamism in recent years. Therefore, prices are rising across the board in much of the country. The causes are various: the strong demand, the inability to buy a home by a large part of the population and the high returns that rent offers. But there is also a change in mentality in the Spanish in favor of this way of life that can be an opportunity for the sector if they know how to take advantage of it, "explains Beatriz Toribio.
Likewise, Oscar Martínez , president of the APEI , also predicts an abundant demand and little rental offer in 2017 , accompanied by a rebound in rental prices, although he recalls that Spain "continues to be a country of buyers" and considers that "This mentality is unlikely to change," since "the vast majority" of the population prefers to buy for various reasons.
Are we going to a new housing bubble?
"There are reasons to be optimistic as long as we have political stability," says Martínez, the president of the APEI , who stresses that "the sector is recovering at a good pace, without symptoms of a new bubble." In this sense, he explains that for a bubble situation to occur, prices must be bloated and "this is not the case", since the boom is currently taking place in large capitals and in coastal areas.
On the other hand, Gonzalo Bernardos predicts a "stage of expansion that will last for many years", and recalls that the key is to learn from the past to avoid another possible real estate bubble.
"When this changes and the economy instead of being in stagnation or recession, the sector must be able to move forward and stop," says Bernardos. Their conclusion is that it is necessary to be vigilant to foresee a possible economic recession and thus avoid that the sector suffers again the puncture of the real estate bubble.
Also Read about Master Plan of Faisal Town Phase 2
Trends in the promotion sector
The president of the APCE (Association of Building Promoters of Spain) , Juan Antonio Gómez-Pintado , highlights young people without emancipation, the finite replacement market and the search for alternative financing, as the main problems that the promotion sector will have to face in the next years. In addition, he highlights that "the entry of foreign investors in our country is very positive, since they are looking for the local knowledge that the promoter has."
For Juan Antonio Gómez-Pintado, in the equation of the real estate sector one leg remains to be developed: the administration . For the president of the national association, the administration "is not adapting its structure to the new times." In this sense, Juan Velayos affirms that "either the administration changes its attitude towards us, or this engine of growth that generates wealth and employment will be lost."
On the other hand, for Beatriz Toribio , one of the keys to 2017 will be that "finally the new home will stand out" in the official statistics and will cut distances with respect to second-hand housing as a consequence of the greater development activity that has been known. in 2016.
"In large cities such as Madrid and Barcelona there is a deficit of new housing and in 2016 there has been an increase in off-plan purchases that will be transferred to official statistics over the next year," he adds.
The challenges of the sector
From the APEI , they emphasize the need to solve the pending issue for the new government, "the regularization of the entire real estate sector . "
“It is dangerous because it is a sector that moves a lot of money and, sometimes, with very little guarantee. We hope that the initiatives developed in Catalonia and the Basque Country will be extended to the rest of the communities, ”says Oscar Martínez, President of the APEI .
In addition, he warns that the demand for commercials for real estate agencies is multiplying, which worries the sector due to the possibility that bad practices such as those that occurred during the "boom" may emerge.
"Although we are working with different regional administrations to advance in a regulation of the sector, it is also very important that the consumer learns to distinguish between a good mediation professional, capable of guaranteeing good service, and a bad professional" adds Martínez.
In the opinion of Beatriz Toribio , head of fotocasa studies , it is necessary to delve into the reforms and changes that the Spanish real estate market needs. Excessive bureaucracy, a better rehabilitation policy and a greater offer of public housing are some of them. But, above all, "there are two challenges that the real estate sector has to face urgently: a clear commitment to the rental market and facilitating access to housing for young people . " For more information visit: carpet cleaner Toronto
Uncertainty in the international market
In TINSA they foresee three factors that will produce uncertainty at the international level, on the one hand, they believe that the arrival of Donald Trump to the US presidency may condition economic relations at the international level (threat of protectionist policies) and create a new political balance between the main powers.
“The public investment policy announced in the US may generate an inflationary outbreak that accelerates the rise in interest rates by the Federation. The current can be transferred to Europe. In Spain we are already seeing the first signs of positive inflation, moderate for the moment. Although it is unlikely in the medium term, an increase in rates would make financing for home purchases more expensive ”.
Finally, from TINSA they believe that the Eurosceptic current in various EU countries threatens the political and economic "status quo" in Europe.
On the other hand, from the APEI they warn of the possible effect of "Brexit" in the sector . Oscar Martínez warns that the devaluation of the pound will translate into a lower purchase of housing by the British . However, the market “is going to move”, because “it will be advantageous for them to sell their properties in Spain because of the devaluation of their currency”. However, APEI predicts that the British will continue to be good investors, especially in the southern part of Spain. In addition, there are also "good expectations" that important international companies will move their nerve centers from London to Madrid and Barcelona, as the most important capitals.
No comments yet