Investment opportunities in the Spanish Real Estate Sector Helsinki, 12th February 2013
The real estate sector in Spain Residential investment played a key role in the long expansion of the Spanish Economy for more than a decade up to 2007. Since the economic and financial crisis has taken up. Source: Spanish Statistics Institute The peak was reached in 2007 and after a severe adjustment process has resulted in a shortening of the residential construction sector. A small recovery took place in 2010, partly due to fiscal incentives, partly because affordability indicators were at historically low levels, but in 2011 and with data of 2012 have dropped again. Foreign demand is starting to react to price signals: after dropping 35% in 2009, the acquisition by non residents rose by 6% during 2010 and 2011.
Real Estate: Foreign Investment Figures of foreign real estate transactions Resident Foreigners Year 2008 2009 2010 2011 2012(Proy. ) Nº 37.714 24.520 30.117 32.303 35.504 % Variation - -34,98 22,83 7,26 9,91 Non-Resident Foreigners Year 2008 2009 2010 2011 2012(Proy. ) Nº 3.691 2.392 2.416 2.546 2.953 % Variation - -35,19 1,00 5,38 16,00
Price Adjustment Overall housing prices have fallen over 23% from its maximum in the 1st Q 2008. Higher discounts have taken place in the Mediterranean Coast, in some of the Canary Islands and in Madrid s outskirts. Housing price variation (Base 1995) 2500 /m 2 2000 1500 1000 500 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Price adjustment: regions (I) Nominal price adjustment of residential real estate has been very heterogeneous between regions - 16,3% - 16,9% Housing price decrease per province 1st Q 2008 1st Q2011-16,7% - 15% - 16% - 17% - 15,7% - 19,2% - 18% - 21,9% - 19% - 21,5% -17,5% - 22,3% - 18,4% - 16,7% - 16% - 15,7% - 21,6% - 21,1% - 19,2% > -20% -15% - -20% - 15,4% - 22,2% - 19,6% - 15,2% - 19,7% Source: Ministry of Public Works
Price adjustment: regions (II) This adjustment has been even more intense in the last year Source: Ministry of Public Works
Municipalities Price Drop: Municipalities Price 2008 Estate Sector (euros/m 2 ) Price 2012 (euros/m 2 ) Price variation (%) Torrevieja 1.707 1.185-30% Oropesa del mar 2.493 1.804-28% Puerto Sta. María 2.226 1.933-13% Marbella 2.751 2.219-19% Torremolinos 2.505 1.868-25% Estepona 1.855 1.654-11% Fuengirola 2.327 1.814-22% Sta. Cruz Tenerife 2.174 1.704-22% Price Adjustment: New Housing 2009 2010 2011 2012 Price (euros/m 2 ) 1910 1841 1729 1572 Variation (%) - 3,6% 6% 9% Source: Adapted from data of Ministry of Public Works Average housing price drop (2009-2012): 17,7%
Stock Adjustment: Features 60% of unsold housing stock are vacational dwellings located in the Mediterranean coast. Stock of unsold houses has started shrinking in 2010, and continues at a stable path in the last two years. National total Total stock, numbers (2012 is a prediction) Evolution of the real estate market In numbers Approved Projects Alienated Real Estate Initiated Projects Mortgaged Properties Finished Projects Source: Expansion and IPE
Stock Adjustment: Regions Map of the real estate stock In number of stock by region and percentage, in 2011 HOUSING Source: Expansion and IPE
Strong Legal and Institutional Framework Public Cadastre Examination of the physical and legal condition of the house Contract Public deed Public Land Registration Office Urban Information Service
Spain as Investment Destination in real estate Infrastructures Spain has the biggest highway net in Europe, and is the first European country and second in the world, behind China, in high speed railway line miles 47 airports in which 250 airlines operate Source: Invest in Spain
Spain as investment destination Hospital Sector: introduction to the healthcare system 2,913 polyclinics and 10,178 local consulting rooms. The autonomous regions with most hospitals are Catalonia (206), Andalucia (104) and Madrid (83). Owing to the high density population, the average hospital covers 50,000 inhabitants. Modern registration and administration system Spain has an on-line clinical-trial registration system. This simplifies and streamlines the approval process for such trials. A comprehensive and protective health system In 2011 the budget amount per inhabitant in Spain was 1,297. This covered nearly 96% of the population (or 45.223.513 people).
Should you have any further question Embassy of Spain - Economic and Trade Office of Helsinki Pohjoisesplanadi 27 C 00100 Helsinki - FINLAND Tel. +358-9-68505335 helsinki@comercio.mineco.es