Home sales in Catalonia soar 20% in 2016

BarcelonaIn 2016 66,447 homes were sold in Catalonia, a figure 20% higher than the 55,373 that were sold in 2015, according to data released Friday by Spain’s National Statistics Institute (INE).

The more than 66,000 homes sold in Catalonia in 2016 exceed the 2008 figures, when there were 62,136 sales, but the number is still far below the record high of 2007, just before the housing bubble burst, when there were 111,482 transactions.

Catalonia is the region with the second highest number of homes sold, only behind Andalusia, where there were 78,708 purchases, and ahead of Madrid (58,231) and Valencia (57,828). It is also the Spanish community with the second-highest increase in sales (20%), and is only surpassed by the Balearic Islands (31%). In the whole of Spain 403,900 homes were sold, an increase of 13.6%

Funding and investors confidence

The improvement in the residential housing market in Catalonia can be attributed, according to Òscar Gorgues, manager of the Barcelona Chamber of Urban Property, to improved access to financing, but above all, to “higher expectations for an improvement in household incomes”.

According to Gorgues, to these two factors "the addition of a new generation to the housing market" must also be added.

In addition, there is a factor that also helps the growth of the market, which is the conversion of housing into an investment alternative. "Investors are buying flats because the alternative of fixed income funds has a very low yield, even potentially negative rates." This, explains the manager of the Chamber of Property, also helps to boost the housing market.

Recovery

According to Gorgues, the data published by the INE indicate that the recovery has solidified in the sector. "It appears to be a consistent recovery," he said, because the sale of homes in Catalonia has not stopped growing since it bottomed out in 2012 with 43,015 transactions. The year 2013 saw an increase of 14%, which rose to 18% in 2014, and to 31% in 2015. Although growth in 2016 was lower, at 20%, it was still a significant percentage, as it reflected a higher base.

However, he claims that there is room for more growth, "but the figures for 2016 already show a good level."

Second-hand properties

The growth of the residential real estate market continues to be focused on second-hand flats. Of the more than 66,000 transactions recorded in Catalonia in 2016, only 8,658 were new housing, while 57,789 were for pre-existing homes.

This trend is generalized in Spain, where sales of second-hand flats soared 17.8%, while new home sales fell 1.7%. In Catalonia, the sale of new flats, however, grew by 2.7% in 2016, but the recovery will be slow, says Òscar Gorgues, because launching new constructions projects takes time, and in addition, there is a significant effect from the Catalan capital, where the lack of land hinders large growth in new construction.