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Friday, January 26th, 2018

The real estate market expects a great 2018

The annual predictions from different sources agree that there will be more real estate buying and selling, while prices increase, especially in large cities.

The real estate market boosts in the centre of Valencia

After a few years of severe recession, the Spanish real estate market faces a recovery period regarding transactions and prices, two realities which will be proved in 2018. According to the annual forecast from different economic institutions, encompassing banks and study centres, properties will start to be sold and bought for increasing amounts, a pattern that will also remain in the luxury real estate market.

The  latest studies service by BBVA Research expects a 6% increase in the real estate buying and selling, reaching 555.000 transactions; a rise in prices close to 5%, and a double-digit growth in the licensing of new constructions . The Bankinter Report agrees with BBVA and indicates the positive value of investing in real estate assets. Its sales predictions about second-hand  properties range  approximately 5.5 million of units and a price increase close to +6.0%, while the evolution of construction permits continues.

That said, Fitch Ratings, the rating agency of credit eventing, specifies that even though property prices will continue to rise in most of the analysed countries, it will grow at a slower rate in 2018. This comes up to the end of the “ideal scenario of cheap or zero-interest loans” in the main developed economies. It is also true that, special considerations for specific cases are made, including Spain, which has recorded increases in spite of “several bottlenecks of loans” over the past few years.

All these elements impact the luxury real estate at a moderate rate, which, even though it did not suffer such a sharp fall with the recession, is experiencing a more overwhelming growth in operations. Barnes Internacional, the national luxury agency values that the buying and selling of properties with a price over 900.000 euros grew by 25% during 2017, while the price of the same experienced an increase of 10%. In places such as Madrid, Barcelona, the Costa del Sol or the Costa Blanca this was around 20%.

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