Spanish Real Estate Market: September 2020 News

Welcome to our September News Digest. Here you can find the latest information on the Spanish real estate market, current statistics and analytics.

1. -4% on the coast

According to Tinsa analytical agency, during the pandemic (since March 2020), Spanish property has lost an average of 1.8% of its value. Nevertheless, specialists consider these figures with a positive outlook, because with the beginning of the pandemic, some experts predicted a 10% reduction in cost by the third quarter of the year. Besides, if we take into account only capitals of provinces, Spanish real estate shows an increase of 0.4%, which is above the most optimistic forecasts.
Coastal real estate
Coastal real estate
According to the study, resort properties on the shores of the Mediterranean Sea and islands suffered the most (-4% of property value). As noted in the report, now the market has favourable conditions for those who want to buy housing on the coast at a lower price. Which areas for buying property are popular in 2020?

2. A website that costs more than 1 billion

Investment giant EQT Partners from Sweden buys the Spanish website Idealista from Apax for €1.3 billion. This is the largest transaction of its kind in Spain. The news has made a lot of noise in the Spanish media, some journalists and experts call this event historic and see it as a confirmation of the prospects and demand for the local property market. Idealista is not only one of the leading websites for the sale of Spanish housing, but also a top newsmaker on the market.
Screenshot from the Idealista website
Screenshot from the Idealista website
Jesus Encinar, the founder and president of Idealista, will remain in his position and retain some of the company's shares. With the financial capacity and IT tools of EQT Partners, the portal is expected to gain momentum. By the way, you can make transactions on Idealista with the help of our managers.

3. Landlords rub their hands

The price of rental housing in Spain has reached a historic high. Today you can rent a square metre of housing in Spain for an average of €11.4 per month. Small towns have been showing positive trends in recent months. In contrast, provincial capitals have remained at the same price level or experienced a slight drop (-1.3% and -1.5% in August in Madrid and Barcelona). This is also due to the pandemic, during which many stayed away from large cities.
Real estate in the Old Town of Girona (Onyar River)
Real estate in the Old Town of Girona (Onyar River)
In terms of annual dynamics, the province of Girona has added the most to its rental price over the past 12 months (+8.9%). On the opposite side of the list is the province of Cuenca (-2.5%).

4. Bee honeycomb in Barcelona

Barcelona is preparing to launch the Haibu 4.0 startup. Managers of the project offer 2.2m² of room space for €200 per month. According to the owners, the complex of apartments in the form of a beehive is designed to solve the problem of housing shortage and high property prices in Barcelona. The rooms are intended only for residents of Barcelona who have lived in the city for at least 10 years and have no criminal record. Euronews reports that over 800 applications have already been submitted for accommodation.
Image from the Euronews website
Image from the Euronews website
The building will operate like a hostel: kitchens, bathrooms and toilets to share on each floor. Due to the small size of these rooms, they are called 'bee honeycomb'. The room fits in a bed, a table, one shelf and a locker.

At the same time, the Barcelona City Council is not in a hurry to issue a permit for a project, as local laws require at least 5 square metres of housing per person (Resolution 141/2012 of the Generalitat). According to startup manager Mark Olive, they will launch even without a permit, and a similar type of housing already exists and is in great demand in Japan.

5. The Franco family is evicted from the castle

The La Coruña Provincial Court of First Instance ordered Francisco Franco's family to be evicted from the Pazo de Meirás estate in Sada. Franco, who ruled the country between 1939 and 1975, used the castle as a summer residence. After his death his numerous descendants (six grandchildren and other relatives) were staying there, as written in the Spanish newspaper El Pais.
Pazo de Meirás palace in Seda, the former summer residence of Francisco Franco
Pazo de Meirás palace in Seda, the former summer residence of Francisco Franco
Franco took over the castle in 1941. It is believed that the historical building built in the 19th century was given to him by the widowed daughter-in-law of the writer Emilia Pardo Bazan, who signed a deed of gift. The court draws attention to the fact that the building was not donated to Franco personally, but was given as a gift to the head of state, and cannot be considered personal property of anyone. Also, in 2008 the Spanish government declared Pazo de Meirás a material heritage. Franco's relatives disagree with the court decision and intend to appeal.

The Pazo de Meirás Castle consists of three towers with serpents on the roof. The area of the site is approximately 6.6 hectares. The total area of all premises is over 2000 square metres.

6. Capitals and COVID: who lost and who acquired?

The Knight Frank analytical agency has released a study on changes in housing prices in the world's largest cities. The report compares prices before and in September 2020. Thus, London (-3.7%), Zurich (-3.6%) and Stockholm (-3.3%) lost the most in price. According to the study, Madrid lost 1,5% over the same period.

On a year-on-year basis, real estate prices rose the most in Manila (capital of the Philippines, +14.4%), Tokyo (+8.6%) and Stockholm (+4.4% for the year, despite negative trends in recent months). Moscow was ranked fourth (+4.1%), and Madrid was thirty-fourth (-0.9%).
Screenshot from a study by Knight Frank
Screenshot from a study by Knight Frank

7. Overview of salaries in Spain

Idealista (via the Adecco consulting agency) has published data on average national salaries in 2020. Of the 17 Autonomous Communities, the top three were Madrid (€2017/month), the Basque Country (€1994) and Navarra (€1886). The average salary in Spain is €1700.
Salary statistics
The lowest salaries are in the Canary Islands (€1460/month), Murcia (€1455) and Extremadura (€1385). Wages and quality of working conditions are one of the main reasons that many people seek to move to Spain.
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