Monday, 11 November 2013

Spanish property purchase news

The buying and selling data for properties in Spain September 2013
Monthly data out today showed that whilst property transfers in Spain increased slightly in September, in comparison to both year on year figures and month on month, the level of actual sales continues to come under huge pressure.
Incorporated into the monthly property transfer figures issued by the INE are foreclosures, inherited properties, commercial property and swaps.
When the numbers are broken down into the number of properties bought in Spain the data looks far from rosy.
What do the property purchase numbers look like
Total property transfers were 126,150 which was an increase of 3% in comparison to September of 2012, however actual sales of properties showed an annual accumulated decrease of 8.8% in comparison to the same time in 2012.
The number of actual sales in Spain between August to September did show a small increase of 1.1% which is the first time sales have been higher in September in comparison to August of the same year, since 2009.
How were the property sales in Spain broken down in September
Of the properties sold in Spain 44.8% were new builds and 55.2% were re-sales. Resales are holding up better than news builds and have increased 4.9% year on year.
In 2012 the Spanish Government put in place tax measures to assist the sale of new builds by lowering IVA and providing breaks on future capital gains. These incentives helped increase new build sales in 2012. The removal of these incentives in 2013 are now showing in the figures. This trend will continue for the rest of year, as sales of new builds were buoyant in October, November and December 2012 as buyers rushed to beat the withdrawal of the tax breaks.
How are the regions house sales holding up
Andalucía for yet another month had the highest amount of sales. The Andalucía region sold 5091 properties in August a small increase from previous year of 0.5%.
The Canary Islands showed the largest increase year on year up by 32.3%.
Only Andalucía, Canaries and Cataluña showed any year on year increase at all, suggesting sales are helped in those regions by nonresident buyers who are looking for holiday homes rather than permanent residences.
If overall Spanish property transfer are up is that good news
Perhaps more worrying than the stagnant residential house sales in Spain is the level of property transfers that are falling into the others pot. This is because the others pot includes Spanish bank foreclosures.
The data suggests further long term problems as Banks accumulate more and more stock from defaulted Spanish mortgages on their books. This will continue to put pressure on the Banks overall profitability as well as the oversupply and pricing of the housing stock.
Of the 30,180 Rustica properties transferred in August only 8,173 were actual sales and of the 54,486 Urban properties transferred in August only 23,805 were actual sales.

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