Bankinter Forecasts 20% Rise in Home Sales in 2016
According to a recent report published by Bankinter, the demand for housing in Spain will continue to grow, reaching up to 420,000 home sales in 2016 and up to 450,000 in 2017, and that the price increases shall not exceed 3% on average, or 5% for those in the best locations.
These figures represent an increase in transactions of around 20% compared to the total of 354,132 homes sold during 2015, according to the National Statistics Institute’s data. Moreover, the Bankinter report indicates that second hand homes will continue to be the dominant choice in a scenario of economic recovery, accounting for over 85% of all home sales transactions carried out in the coming quarters.
As the homes being constructed in the second half of 2015 come on the market, says Bankinter, sales of new homes should increase to account for over 15% of the sales, with the number of transactions reaching possibly 60,000 or 70,000 units per year.
This increase in demand, explained the financial institution, is due to the expected improvement in employment, as well as low interest rates and the greater attraction of housing as an investment.
With regard to prices, the report notes that the residential market varies depending on the area, but that average prices are likely to rise, driven by a lack of supply in places like Madrid or Barcelona. In this regard, the report also indicates that the first increases in land values could begin to have an impact on the final prices of housing.
However, El Mundo reported that Bankinter emphasise that these price increases will not be significant as some of the purchases will be for foreclosed housing awarded to the banks, being sold at great discounts. Moreover, as a result of these advances in the market, the ‘stock’ of unsold new homes could fall to below 500,000 units during 2016.
source - Kyero.com