The coronavirus crisis has convulsed the Spanish real estate market , changing the housing paradigm and revaluing areas and homes , such as those located on the periphery of urban centers and second lines, which until now had no special attraction or were seen as vacation opportunities .
In this context of change, the real estate sector is stably resisting the pandemic. In fact, the expected fall of 7% in the price of housing in Spain will not occur this year, according to the forecasts of the Spanish Association of Real Estate Personal Shopper (AESPI).
Yes, there is a segment that has remained stable throughout the crisis and that reflects the economic stability of its demand: new construction . In this sense, prices have been maintained and even increased since 2020, placing the average price per square meter in large cities such as Madrid and Barcelona at around 4,000 and 4,400 euros , respectively. In addition, the metropolitan areas of the large Spanish capitals continue to account for a good part of the new housing developments due to the greater accessibility of construction companies to finalist land at competitive prices.
“This trend is explained through the ability to adapt the supply of new construction according to demand and the characteristics of these properties, which better respond to the needs of outdoor spaces and square meters of this post-pandemic society, and not they are found in second-hand homes, traditionally located in city centers “, explains Iñaki Unsain, personal shopper and president of AEPSI.
The evolution that second-hand housing has followed has been different. According to experts, this segment has suffered the consequences of the crisis to a greater extent, with price drops of up to 7% in the main Spanish cities such as Madrid, Barcelona, Valencia, Seville or Malaga. Migration to the periphery of cities and the need for liquidity of many owners as a consequence of the drastic decline in tourism and the different ERES and ERTES processes are pointed out as possible causes.
However, not all second-hand properties have followed the same trend. In this sense, the 50-70 m2 flats have been the best investment assets due to the high profitability they offer and their contained purchase and maintenance costs, and the ones that have experienced the least price drops.
In addition, this type of property “has had a greater demand for rent from a very solvent profile, such as executives who have moved to the city to work and master’s students,” explained Unsain.
With regard to the rental market, the transfer of tourist rental to residential increased the offer, causing the beginning of the year with price reductions of 5% in the main Spanish cities, but stabilizing throughout the year due to the European vaccination plan and the progressive boom in tourism. The rental has a long history around the big cities, since there is still a great demand related to the work environment and an urban lifestyle , in addition to attracting part of consumers with low debt capacity.
“The good prospects that open with the vaccination plan, the fall of the state of alarm and the return to the ‘new normal’ predict a progressive recovery of the real estate sector for the summer , waiting for what happens with the successive extensions of the ERTES “, assures Montse Moreno, personal shopper and vice president of AEPSI.
The expert believes that if the planned vaccination plan is fulfilled and there is a certain opening of borders, this will affect the rental market in a special way, since it is expected that a new transfer to this market is already being noticed to give “coverage to the demand existing”.