A favourable exchange rate, signs of recovering foreign property markets and improving mortgage availability have combined to drive confidence in purchasing European real estate in 2015, said Spot Blue International Property in July.
The stronger Pound means that for UK buyers the price of property in the Eurozone has fallen by around 10 per cent since the start of the year. In real terms, a €150,000 home in Spain, Portugal or France is now – at the end of July – around £12,000 cheaper than it was at the start of the year.
In Spain, bullish stats from Spain’s General Council of Notaries reveal that national home sales rose 8.4 per cent in May compared to the same month last year. Resales are driving the recovery, achieving a 14.5 per cent year-on-year increase for the month, while new home sales fell 21 per cent. Meanwhile, interest in Spanish property is being boosted further by the country’s record tourist numbers, which increased 4.2 per cent between January and June this year compared to the same period in 2014.
“There is evidence of not just price stability but also rises in some major cities and established parts of the Costa Blanca, Costa del Sol and Mallorca, an island that according to new research by the valuation consultancy Tinsa is home to five of Spain’s ten most expensive property hot spots,” said Julian Walker, director at Spot Blue International, which sells in Spain. “The struggling new-build sector could be due to limited supply of quality new projects in desirable areas,” said Mr Walker. “Today’s buyers of new-build are discerning and understand the benefits – 10-year guarantees, potential capital appreciation, the chance to customise fixtures and fittings, and that modern, efficient building materials are used.”
In Portugal, the latest RICS/Ci survey indicates a recovery is well underway, revealing that in May enquiries for property continued to rise month-on-month while agreed sales rose at the sharpest rate since records began in 2010. The survey also highlighted that Portuguese prices are expected to rise an average two per cent this year, although more in Lisbon and the Algarve (2.5 per cent). Data from Statistics Portugal (INE) show that property values in Portugal began to rise in 2014, namely by 1.81 per cent in the year to March 2015.
Confidence in Portugal has been bolstered by the improving lending conditions and rise in mortgage applications. “Banks and lenders saw a hike in enquiries after Portugal made a clean break from its bail-out last year,” continued Mr Walker at Spot Blue International Property. “But this year, the exchange rate has triggered those enquiries into applications from British buyers.”
Outside of the Eurozone, sales in Turkey’s property market saw consistent growth for the first five months of 2015, to the point that in May purchases by foreigners hit a record level and achieved a 21.3 per cent rise compared to the same month last year. According to the Turkish Statistical Institute (TurkStat), sales of Turkish real estate to non-Turks rose 19 per cent between January and May compared to the same period in 2014, with 8,097 properties bought by foreigners. Istanbul and Antalya on the south-west coast are the most popular buying areas with foreigners.