Costa del Sol property decreases
House price statistics released by the government last week revealed that the average price of property in Spain is now down to 2005 levels. Their figures are based on price per square meter, which currently stands at approximately 1,700 euros.
These latest reports show that the average house price has fallen by 22% since the peak, but that doesn’t tell the whole story. This price index provides a national average, giving a reflection on the market at a macro level – what it doesn’t represent is data on individual properties, or areas within a town on a micro level.
There are plenty of reports of properties that have more than halved in price since the peak of 2008. As a known example, a property was purchased by a colleague for 180,000 euros 10 years ago, they subsequently sold it for 695,000 at the peak of the property boom and it was resold earlier this year for 320,000 – quite a dramatic rise and fall.
While this may not be “average”, it demonstrates that while the national price drop of property in Spain may be 22%, there are some properties where vastly larger savings can be achieved. By definition, a national average takes into account all areas of Spain, including highly populated cities, where there has been no overbuilding and demand has remained consistent.
Around coastal areas, such as the Costa del Sol and Costa Blanca, as well as in resorts on the popular Balearic and Canary Islands, some towns have seen prices fall by between 28 and 49 percent. These numbers still reflect an average but give greater insight into local trends than any national statistic.
Some of the price differences can be attributed to speculative developers whose overbuilding has left them desperately seeking buyers and offering heavy discounts. There will also be properties that have been repossessed or required a quick sale from their cash strapped owners.
But the take away for both buyers and sellers is that prices are very much dependent on location – anyone seeking to sell their property should be realistic when setting their sales price and headline average price cuts should not be used as a guide. While, for buyers seeking a bargain, these coastal areas are clearly the place to head for sun, sand, sea and cut price properties.
- The map below shows price decreases in larger popular coastal and island towns (all with a population of at least 25,000) -
Source article: Kyero.com