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An increased number of foreign buyers is set to boost the residential property market in the Costa del Sol in Spain, one of the country’s most popular areas with overseas purchasers.

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A new market forecast report from Instituto de Practica Empresarial (IPE) business school, in collaboration with property company Mar Real Estate, suggests the market could grow by 10% in the area.

It also says that the market is set to grow by between 5% and 7% in major cities such as Madrid and Barcelona and 3% in other cities.

The IPE says that home prices on the Costa del Sol are already up 10% this year, and now represent 5% of all sales nationwide and if sales continue growing at their present trend, the property market in Málaga province will increase to 20% of the overall Spanish market.

The growth is buoyed by foreign demand for holiday homes on the Costa del Sol and the IPE report suggests that surging sales will help reduce the glut of new homes on the coast. Indeed, the excess inventory of new homes is expected to fall by 50% this year.

Luxury home sales, in particular, are coming back strongly on the Costa del Sol, according to the IPE report, driven by a better exchange rate in Pounds and Dollars, and the security and stability of Spain.

Meanwhile, the latest report from property valuation firm Tinsa says that the Spanish property market is undergoing a widespread recovery. Average property prices fell by 2% year on year in July, the lowest rate of decline since May 2008 but this masks growth areas along the Mediterranean coast in particular with some areas seeing price growth of 2.8% year on year.

The data shows that on the Mediterranean coast, where prices have fallen by an average of 47.6% since the economic downturn, the average price of a home has increased by 3.8% since the end of 2014. This is more than large cities and the Balearic and Canary Islands where average prices have risen by 0.2% and 0.9%, respectively.

Tinsa data also shows that five of the top 10 most expensive property hotspots are located in the Balearic Islands but Alejandra Vanoli, managing director of Mallorca Sotheby’s International Realty, said that there are prices per square metre in these locations that far exceed Tinsa’s estimations.

‘It’s not unheard of to reach as high as €30,000 per square metre for the most desirable Port Andratx home. Demand is strong from some of the wealthiest individuals and families in Europe, the US and beyond,’ she explained.

Tinsa figures also suggest that the Balearics weathered the storm of the Spanish property market price ‘correction’ more positively than the rest of the country. While the average drop in prices across the whole country stands at 42%, in the Balearic Islands most regions registered less than a 35% decline.

Palma was also highlighted by Tinsa as property transactions increased by more than 50% in 2014, higher even than the mass volume markets of Torremolinos and Benalmadena. Indeed, luxury bricks and mortar is seen as one of the main drivers behind the strength of the Balearic property market. Tinsa director Jose Antonio Lopez states that the luxury coastal market is one of the areas where the turnaround is most clearly seen, owing to the differing dynamics at the top of the market.

The world’s most popular tourist destination is Mallorca, according to website HotelBeds.

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The island is even more popular than destinations like Disney World in Orlando, and is followed in popularity in Spain by Barcelona, Tenerife, Benidorm and the Costa del Sol.

Mallorca is full to overflowing with tourists in hotels and apartments. In June, the National Institute of Statistics (INE) confirmed that holiday lets on the island reached the highest occupancy levels in Spain. The island’s favourite destinations are Alcudia and Calvia, and it appears that tourism is due to continue along the same lines at least until the end of September, a month which is seeing figures rise each year.

The British, German, French and Italian markets are providing Mallorca with even more visitors than in other years, and growth within the Spanish market is at around 15 per cent.

HotelBeds concludes that the amount of activities available to tourists is also rising to keep up with demand. The site has a database of 75,000 hotels in 180 countries.

AUGUST kicked off to a busy start for Malaga-Costa del Sol airport, where activity has been frenetic over the last week.

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As predicted, the first weekend of the month registered large amounts of travellers with 316,000 passengers passing through the airport in just five days.

The busiest day was Saturday (August 1) with 412 flights, although queues were also extra-long on Monday when 392 flights were reported.

Spain’s Balearic Islands are one of Europe’s most attractive and loved summer sun destinations. Holidaymakers from mainland Spain, along with the UK, Germany and Italy flock to the islands every year, craving their perfect balance of sun, sea and sandy beaches. Amongst Spanish residents, the Balearics come second only to Andalusia in terms of popular tourism destinations, accounting for 18% of total bookings according to HomeAway figures.

The principle island of Mallorca saw 9.54 million visitors arrive through Palma Airport during H1 2015, an increase of 2.9% over the same period last year. Both April and May saw passenger numbers reach record levels. The figures are good news for the island’s property market, as Marc Pritchard, Sales and Marketing Director of leading homebuilder Taylor Wimpey España, explains,

“More visitors arriving in Mallorca has had a positive impact on the island’s economy and has pushed up demand for second homes, with many of those who visit – myself included – falling in love with Mallorca almost on first sight.”

Marc was an early advocate of island life, moving to Mallorca back in 1989. Since then, the island has changed dramatically, yet has still retained its essential charm and stunning, unspoiled vistas, from pristine beaches to steep, rocky mountains.

Now, with more visitors and holiday home sales booming, Mallorca is enjoying property prices rises of up to 10-15% in some locations, according to one local estate agency. Apartments with outdoor space in good locations are the properties most in demand, advises Marc Pritchard,< "Buyers want to enjoy the sunshine at home, as well as at the beach, so homes with well appointed terraces that offer space for sunbathing or for outdoor dining sell particularly well." Two of Taylor Wimpey España's most popular developments on the island are Cala Magrana III and Cala Anguila II. Both enjoy extensive grounds, with lush landscaping and large shared pools. Individual apartments all have generous terraces and well considered views, in addition to high spec interiors. Prices start from €220,000 at Cala Magrana III and from €230,000 at Cala Anguila II.

For second home owners from the UK, access to Mallorca is set to get even easier from 2016 onward, with British airline Jet2 opening a new line between Manchester and Palma from February 2016, with up to three flights per week, and between Edinburgh and Palma, with two flights per week from March. Jet2’s Steve Heapy has commented that the flights should help to combat tourism seasonality and holiday home owners will certainly want to take advantage of this, as part of the joy of owning a second home on Mallorca is the ability to enjoy the island not just during the peak of summer but also earlier and later in the year when the masses have headed home.

So, will the new flights contribute to further price increases on the island, as demand continues to soar?

“It’s certainly possible,” concludes Taylor Wimpey España’s Marc Pritchard. “Mallorca has proven itself to be an enduringly popular location over the years and demand for high quality properties here is high right now. If demand continues at this level I think we can look forward to prices continuing to rise over the months and years ahead.”

For more information, please contact Taylor Wimpey España today on 08000 121 020 or visit www.taylorwimpeyspain.com. Those residing outside of the UK should call 0034 971 70 69 72.

Monarch has added an additional 7 weekly flight frequencies to its summer 2016 schedule from Leeds-Bradford Airport including a new route from Leeds-Bradford Airport to Malaga on the Costa del Sol.

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Additional Leeds Bradford routes and frequencies now on sale for summer 2016 include:

  • Leeds Bradford to Malaga​- ​new route – 3 x weekly flights
  • Leeds Bradford to Naples​- ​2 x weekly flights

The new summer 2016 schedule from Leeds Bradford also includes increased frequencies to Faro on the Algarve and Dalaman in Turkey with flights at sociable flight times; allowing customers to escape for a weekend or a longer break to some of Europe’s most popular leisure destinations.

Marjan Schoeke, Head of Network Development for Monarch Airlines said:
Next year’s schedule (summer 16) offers more flights from our most popular destinations at Leeds Bradford as well as introducing a new route to Malaga on the Costa Del Sol.

This follows the launch of our summer 2016 programme last month when over 80% of Leeds Bradford’s summer schedule went on sale.

Tony Hallwood Leeds Bradford Airports Aviation Development Director said:
The introduction of Malaga from Leeds Bradford is a welcome addition to the Monarch route network serving the Costa Del Sol region for holidaymakers and overseas property owners alike.