While UK home ownership has fallen to its lowest level in 25
years, some Eurozone countries are enjoying a resurgence of their property
markets thanks to more affordable house prices and greater demand from overseas
buyers. In some parts of Spain, in the Canary and Balearic Islands, at the
Costa del Sol’s Marbella and in Murcia, some localised hot spots are emerging,
where foreign buyer demand is causing quite a stir.
For people living in cold Northern European climates the
prospect of relocating permanently to the sunny shores of Portugal or Spain has
always been a great comfort. After several consecutive summers bringing nothing
but floods, increased heating bills and grey skies, many property buyers look
to Mediterranean countries for their retirement, especially now, when Spanish
property has become affordable.
Already Costa del Sol resorts are seeing prices becoming
more stable thanks to a growth in enquiries and sales activity. In Murcia for example
a number of golf developments and properties located within close proximity to the
planned Hollywood theme park are doing very well indeed.
It seems many investors, particularly cash buyers, have been
waiting for the right moment, namely when property prices had fallen significantly
in luxury resorts. It’s not cheap and cheerful properties at the Costa Blanca
that are selling like hot-cakes; it’s actually quality build, high-end
properties in Mallorca and Ibiza in the Balearics and in Marbella’s luxury
developments where penthouses and apartments are selling out fast.
Lifestyle remains key – with more than 300 days of sunshine,
azure blue skies and year-round warm water temperatures what’s not to like
about the Costa del Sol? Demand for resort property has been growing steadily;
with more than 1 million golf tourists flocking to Spain last year, it’s easy
to see why investors will queue up for a place when international property brokers
arrange viewings in golf resorts.
One leading developer, Taylor Wimpey España, recorded record
sales last year for their resort-based properties. Their Avalon beach
apartments are on the market for just EUR 195,000, while their Los Arqueros
golf apartments are being offered from EUR 250,000. Respected and well-known
for their high-end builds, the company is increasingly seeing more off-plan
buying activity, something that hasn’t happened to this extent since the
Spanish housing market last peaked at the end of 2007.
Resales are currently outperforming new builds. In order to
off-set the increases in Spanish VAT charged on property purchases this year, many
vendors have adopted a more realistic approach to what offers they should
accept. Buyers have appreciated this and are making more realistic offers,
resulting in more completed sales.
Although resales and newly built properties in resorts like
Marbella have been doing much better than a year ago, it has to be said Spanish
house prices have continued to fall because Spanish banks have shed
repossessions by the thousands at heavily discounted prices.
Offered with 100% finance and without the need for a
deposit, some new 2 to 3-bed apartments in Elviria, eastern Marbella, and located
within a 5 minutes’ drive of the Golf Club House at Santa Maria Golf Club are such
a bargain that few long-term investors could resist.
At starting prices of EUR 253,405 and EUR 336,470 they do
not fall into the “cheap-as-chips” bracket, but they are such good value for
money thanks to their high-end finish and great location, they will bring their
new owners excellent holiday letting yields for many years to come.
Some resort repossessions are also amazing value for money
with asking prices starting at just EUR 155,000 for brand-new, 2-bed, 2-bath
apartments located in the east of Marbella. Offered with 94 sqm of floor space
including a sun terrace, these apartments are not even the best buy by a long
chalk!
In the resort of Calahonda, located approximately 15
minutes’ drive from Marbella and 35 km from Malaga Airport, prices in a small development
close to the famous Nikki Beach Club start at just EUR 115,000 for 2-bed,
2-bath apartments with 74 sqm living space, while apartments with 81 sqm floor
space are being offered at EUR 159,000.
On a clear day the views stretch all the way to the coast of
Africa, what investor could possibly resist?