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Market OverviewThe southern coast of Spain has long been a popular destination for tourists and foreign buyers, driving much of the nation’s housing-market recovery after years of falling prices in the wake of the global recession.
Before the coronavirus forced Spain to shut down in March, the market on the Costa Del Sol, just south of Málaga, was very stable, with constant high demand since 2012. Sales-wise, 2019 was “one of the best.”
Many important sales were achieved prior to the lockdown. Prices did not seem to be affected by the fears announced by some experts.
As of Aug. 18, Spain had reported 359,082 cases of Covid-19 (the most of any European nation) and 28,646 deaths (fewer than Italy, France and Britain).
Today, the market has nearly bounced back to pre-pandemic levels. Though a few deals were immediately cancelled when the lockdown began, most agencies saw strong interest, fielding more inquiries than usual from local, national and international buyers. The agencies were able to close deals also during the lockdown and some deals were generated via virtual viewings.
Still, total real estate transactions fell by about 20 percent from 2019, because of the “historic drop in air traffic and to the quarantine imposed to avoid the virus spread.”
When stay-at-home measures were eased in Spain and other countries, “pent-up demand” for properties on the Costa Del Sol rocketed, with property searches climbing 34 percent compared with the same period last year.
As soon as flights were authorized to land in Spain, sales started to happen, with many of the deals agreed prior to Covid-19 and completed in May and June. Prices and sales remain on par with 2019, with neither significant discounts on the deals nor big hits on the asking prices. With so much demand, some asking prices have increased.
Deals are also closing quickly. Many European clients that seem to be in a hurry to purchase houses here. People realize the comfort and efficiency of working remotely.
The Costal del Sol has 17 municipalities and more than 93 miles of coastline. Marbella has long been “the jewel of the crown,” including the neighbouring towns of Estepona and Benahavis in the “Golden Triangle,”.
The “Golden Mile,” between Marbella and Puerto Banus, is also coveted by deep-pocketed foreign buyers, with luxury prices ranging from $3.5 million to more than $70 million.
Sixty percent of buyers are purchasing holiday properties, often seeking modern new houses with traditional Andalusian flair. Prices for two-bedrooms near the beach range from 700,000 to 2.5 million euros ($828,000 to $2.95 million). Further inland, buyers can find properties for as little as 350,000 euros ($415,000).
In the port city of Málaga, home to about 570,000 people, the majority of buyers are full-time residents. Resales of older homes dominate and Mediterranean style is most coveted. New condominiums are being developed in the city and along the coast. In Málaga East, mansion prices top out at 4 million euros ($4.7 million), far lower than in Marbella.
Who Buys on the Costa del SolIn the province of Málaga, 28 percent of property transactions in 2019 were completed by foreign buyers. In the first quarter of 2020, it was about 33 percent.
Buyers typically come from Britain, Germany, Scandinavia, the Netherlands, Belgium, France and Finland and in general, span the globe, including the United States, Canada and the United Arab Emirates.
Buying BasicsThere are no restrictions on foreign buyers in Spain.
A Foreign Identity Number, obtained through the police department, is required for opening a bank account or to buy property.
A notary must oversee the process of signing contracts, transferring deeds and ensuring that taxes and fees are paid. An independent lawyer specializing in Spanish conveyance laws is highly recommended to do due diligence and check title.
Banks offer mortgages to foreign buyers for up to about 50 percent of the purchase price.
Source: The New York Times
11/13/2022 02:34:00 am
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