The market splits in two
Signs of British nerves are drowned out by a European show of force.
February continued 2017’s bouncy start, with over 550,000 people visiting Kyero. They generated just under 62,000 sales leads for our agents, a 25% annual rise.
Looking back over a year of double digit growth, I’ll admit it was becoming hard to pick out the real strengths and weaknesses in the international market. When every indicator is green, it’s tough to separate trends from threats.
However, I think March 2017 will mark a change of narrative.
European buyers step on the gas
Spain has always put a focus on British buyers, but it’s easy to forget they account for just 1 in 5 foreign sales. Most market statistics break buyers down by country (putting Brits forever in the no.1 spot), but European buyers are a much bigger market.
If we report European buyers collectively, the picture looks very different:
Over 60% of Kyero’s audience are now European, and with traffic from this group hitting double digit growth since the summer, it’s easy to see where the real sales drive is coming from. To help clarify the picture, our monthly market report now breaks the audience into both national and European groups.
In a market that is increasingly multilingual, Kyero’s decision to operate in 13 languages has turned out to be a reassuring move. We’re nicely placed to follow a shifting audience.
British pensioners take fright
A strange thing happened to British traffic in February: Visitors hit an all-time high, then they blinked.
UK visits grew 36% on the previous year, but following months of enquiries growing at a similar rate, enquiry growth stalled. Sales enquiries from British buyers grew just 1.5% versus February 2016.
How can UK visitor numbers reach record levels, while enquiry growth dries up?
It means British buyers still want to buy, but they’re becoming less likely to progress their search to a viewing. Listening in on buyer chatter shows Article 50 is the obvious culprit. Brits are now in a holding pattern while they wait to see how Brexit negotiations progress.
Arguably the group with the most to lose from Brexit are British pensioners, and we detected clear signs of their nervousness in the latest traffic demographics:
Healthcare and pensions will be hot talking points in the Brexit process, and anyone planning a retirement in Spain should watch closely. On balance we think the majority of British buyers will (at most) be mildly inconvenienced by Brexit; it’s unlikely to materially change travel access, property rights or availability of credit.
However reassurance and calm heads will be needed, and agents should expect a period of subdued British interest until this shakes out. It’s time to turn our eyes firmly on Europe.
Prices remain steady
Kyero’s median asking price is unchanged at €245,000 – but this has slowed the annual trend to +5.8%. Beyond the cauldrons of Madrid, Barcelona and Ibiza, official Spanish house prices remain a patchwork quilt of marginal winners and losers. Kyero’s numbers show a broadly similar picture:
|#||Province / Island||Avg. price||Annual trend|
This provincial list tells some of the story, but also hides a rapidly changing local picture too. For example in the province of Malaga, high-end Marbella is showing price falls of nearly 9%, while Mijas – its prettier and cheaper inland neighbour – has risen nearly 14%.
(We’re working on a better way to surface these nuances in future reports.)
As we move further into the year, the Canaries begin to loosen their grip on winter trends. Gran Canaria is having a particularly good start to the year, with enquiry rates running at nearly 5 times the site average. Lack of supply here is a frustration.
There are some interesting new entries on this month’s list. One such is Albox in Almeria – a region we’ve tipped as an alternative for tightened British budgets. With buyer enquiries running at 4 times the site average and a median price of €129k, this traditional inland town could be very much in vogue.
|2||▼1||Playa del Ingles||Gran Canaria||€175,000|
|3||–||Puerto Rico||Gran Canaria||€139,000|
|4||–||Playa de las Americas||Tenerife||€349,000|
|7||▲2||Costa del Silencio||Tenerife||€131,000|
|8||▲6||Playa de los Cristianos||Tenerife||€220,000|
|13||NEW||Lloret De Mar||Gerona||€262,500|
|14||▼6||Playa Blanca (Yaiza)||Lanzarote||€278,000|
|15||▼5||Chiclana de la Frontera||Cadiz||€170,000|
|16||▲2||Las Palmas||Gran Canaria||€175,000|
What next? INE.es has just published the Q4 House Price Index, which gives us an opportunity to take a much deeper look at what happened to prices across Spain in 2016. There’s also something interesting happening with American buyers… the Trump effect? I’ve started musing on LinkedIn and Twitter – do say hello.
Download the Kyero Spanish Property Report, Feb 2017 (PDF, 171Kb)
We promote 200,000 properties in Spain to international buyers in 13 languages