The second residence is slowly getting off the ground in the Spanish real estate market, and the offer is mostly on the coastline. We must recall that the economic crisis speeded up the outbreak of the housing bubble which had an even greater impact on second residences as well as on coastline apartments. It is estimated that there was a drop of around 60% on the price of second housing. They were difficult years due to the fact that this devaluation also affected the maintenance of second housing. Liquidity shortage led to abandoning or neglecting, in many communities, the maintenance cleanup tasks as well as the management of gardens and swimming pools, to the despair of the owners. Fortunately, everything has changed over the last few years, and second residences have, thankfully, turned the corner. The best proof of this, according to Tinsa, is the increase of around 6,4% on the price of housing in holiday areas in Spain and this price rises to 9,4% on the islands.
A MODEST RECOVERY
Even though there has been an increase on the sale of second residences, we are still far away from the figures before the crisis. It is estimated that housing prices on the Mediterranean coast are below 45% in relation to 2007 prices. This fact shows that we must be cautious and that we must also be aware that even though the situation has improved, we are still behind a full recovery regarding the best of times. According to the report carried out by Tinsa, in the first term of 2017 the Mediterranean areas which had the highest annual variation were Manilva (15%), Marbella (11,3%), Benidorm (10,9%), Denia (9,7%) and Benalmádena with 8,9%. Of all of them, Marbella is the most expensive as the price is 2.047€ per square metre, and in second place comes Benidorm with a selling price of 1.585€ per square metre. However, we must point out that Sitges is the most expensive area on the Mediterranean coast as the selling price is 2.815€ per square metre, even though its annual variation is only 5,2%. In any case, as we have already mentioned, the prices are nowadays much more affordable than they were ten years ago during the housing boom. Because of this, we must be cautious and regard the current situation as a modest recovery.
THE TOURIST BOOM
Some time ago, we wrote about the relationship between tourism and second residences. There is no doubt that foreign investors have contributed to the real estate boom in this sector. Moreover, foreign tourism as well as Spanish tourism have helped the sale of coastal property and thus making it a profitable investment. Generally speaking, the real estate offer varies a lot as it depends on the area and the age of the house. Therefore, you can find from very affordable apartments to luxury homes equipped with the latest technology and which are aimed at very specific people. Those who are looking for an exclusive second residence are attracted to the area of Marbella and the Balearic Islands. Experts state that the best time to invest is now. This is due to the fact that in the near future prices will rise even though they will not reach the 2007 figures.
Picture 01: Ashley Buttle
Picture 02: Matt Kieffer