Spanish property prices rose by 1.1% year-on-year in January according to the latest data released by the valuations company Tinsa in its IMIE National & Large Markets report. The results get 2016 off to a great start and point towards it being another year of growth for property prices in Spain after a national rise of 1% was recorded in 2015.
The increase also means that prices are rising again after a decrease of 1.8% year-on-year was registered in December. The peak-to-present drop in prices now stands at 41% in Tinsa’s data series but the company states that recent results point towards stabilization and that current economic growth forecasts bode well for property price evolution going forward.
Islands & major cities leading increases
Of the 5 groupings into which Tinsa splits Spain for its monthly study the best performers in January were the Balearic & Canary Islands with a 3.2% year-on-year rise in prices followed by Capitals & Major Cities which saw an increase of 2.9%.
Prices in both the Mediterranean Coast and Metropolitan Areas groupings remained steady and registered increases of 1% and 0.8% respectively while the only negative result was recorded for the Remaining Municipalities grouping in which prices fell by 2.2% on January 2015.
Mediterranean Coast offering bargains
In recent months the Mediterranean Coast has started to see increases in property prices after years of decreases. Tinsa puts the peak-to-present fall in the value of property on the coast at 48%, the highest of all its groupings, meaning that property prices in the area are almost half of what they were in 2007.
Most parts of the coast are now seeing an upturn in the number of sales with this being especially evident on the Costa Blanca, Costa Brava and Costa del Sol. This coupled with the recent stabilization in prices makes it a prime time to look at investing in property in the coast’s best locations as capital growth is guaranteed with strong rental potential being a further bonus.
Experts are currently queuing up to give their opinion on the recovery of the Spanish property market and the consensus is that 2016 will be a good year. Juan Carlos Álvarez, the Director General of Real Estate Business at ServiHabitat, has predicted a rise in prices of between 6-6.3% for the year.
As evidence to back his optimistic predictions he cites the fact that certain areas of Spain have already seen significant rises in the price of property due to a lack of new-build stock which is causing supply bottlenecks and pushing property values upwards. He expects to see growth in construction in 2016 and forecasts a 13% rise on 2015 in the number of new-build properties completed.
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Main image: Artist’s impression of the Residencial Silene development on the Costa Blanca ©TM Real Estate Group