Confidence in the Spanish property market is returning as British buyers flock to take advantage of falling prices.
Overseas mortgage specialists Conti say Spain is now the world's number one destination for Britons buying overseas, accounting for 43% of enquiries.
With some holiday homes selling for just 20% of their original asking price, Spain has outperformed every other country in the three months to October, including France.
Conti director Clare Nessling said: “This is the first time since 2008 that Spain has accounted for so many of our enquiries over so many months.
"It was very popular over the summer period, but there’s been a definite shift over the last six weeks in particular."
A number of factors are pulling buyers in, Nessling said. "Tourism is booming, access is easy and the culture is familiar, but it has also become much more affordable.
"Mortgage rates are very low, the pound has been getting stronger, and prices are still bottoming out in some areas.
"It’s a great time to buy and people who have been putting their plans on hold for the last year or two are taking advantage of the favourable conditions and deciding to go for it.”
International purchases of property in Spain grew 13.6% in the first six months of 2013, compared with the same period in 2012, according to figures from the General Council of Notaires.
The Bank of Spain has reported that foreign investment in Spain reached more than €2,834 million in the first half of 2013, the largest amount recorded since 2004.
The British are still the biggest buying group.
Sales to overseas buyers are now expected to increase even more, thanks to a new law granting a residency visa to non-European Union nationals if they spend a minimum of €500,000 on property.
This has effectively opened the door to thousands of potential investors.
Estate agents in Spain are also reporting increased activity. Peter Birkett from Property Repossessions Spain, says: “After a very difficult few years, prices are starting to creep back up in some areas, and people who have been watching the market are putting their plans into action in case they end up missing out on the best possible deals.
“I’ve recently sold properties to British buyers who have been holding out for the last three years, but the current market conditions have convinced them to make the purchase.
"Confidence amongst UK buyers is definitely returning, with the Costa Blanca, the Costa Almeria and the Murcia area proving to be very popular.
"We have a two-bed, two-bathroom property in Almeria on our books at the moment with a sale price of €65,500, down from an original asking price of €298,000. Bargains like this won’t last forever.”
Spanish lenders are still willing to provide finance to foreign nationals, particularly if you can prove that you have a sound financial profile. Buyers can generally borrow up to 65% of the value of the property, with rates starting from just 3.23%.
Nessling said buyers must seek the right advice. "Bitter experience has taught many Spanish property buyers that scrimping on independent legal advice can effectively cost them their holiday home. Buyers should always go through the same process that they would follow if they were buying a property in the UK."
Comments