The present property boom in Spain begun in the late 1990's. It was widely
recognized that the imminent introduction of the euro coupled with strong
worldwide economy growth were the principal factors driving the market at
this time.
Non declared earnings were ploughed into property, as the Spanish public
desperately tried to 'get rid' of legacy currency. Add to this, the continued
popularity and availability of property purchases from the UK and other
European countries (6 billion Euros in 2002), saw Spain and the property
market 'boom' with accelerated growth.
However since the euro was introduced in 2000, you can see prices have
continued to accelerate. There are a number of factors behind these
increases. Firstly we are living against generally low interest rates.
Mortgages, which were running at 15% in the early 1990's have been
trimmed to below 4% in some countries. Another factor is demographics,
the Spaniards of the baby boom (early/mid 70's) have belatedly begun to
leave the nest - Spain is also experiencing large net immigration.
In economic terms, since the end of the Franco dictatorship, and especially
since entry into the European Union, living standards in Spain have
increased dramatically (12% disposable income growth since 1997), closing
the gap on the rest of Europe. The poor quality housing stock of that era has
given way to improved standards, as Spaniards have demanded more
luxurious homes.
The biggest property growth increases have been in the heavily populated
areas of Spain and it's cities, around Madrid, Barcelona and the Basque
Country. General property growth and a steady reduction in family sizes
which has resulted in the smaller more centrally located flats / apartments
seeing the largest rises. However demand by foreign and domestic buyers
for holiday homes has pushed up the prices in the tourist coastal havens
of all the 'costa' regions notably, the costa del sol (Andalucia) and the
costa blanca (Valencian).
|
Property Search
Spanish
Property Market 
