Just a Year’s Supply Left?
According to the Malaga Provincial Association of Builders and Developers, the Costa del Sol has a stockpile of just one year’s supply of new properties. This perhaps surprising statistic adds fuel to the belief that the property prices on the Costa del Sol are set to see a healthy increase from next year, proving beyond doubt that now is the time to make property investment in Spain.
Statistics from the Association estimate that there are currently slightly over 20,000 unsold new properties on the market on the Costa del Sol. The Association claims that this figure is not high since it is the usual demand for a year. Add to this the fact that there is virtually no new construction taking place on the Costa del Sol at the moment and it becomes obvious that the area is not far off a situation where supply meets demand. Once demand outstrips supply, prices will begin the inevitable upward trend.
Property experts are unanimous that one of the major problems currently facing the Spanish property market is the huge oversupply of unsold new properties. Although there are no definitive official figures, the numbers of unsold units throughout Spain range from one to two million, depending on the source quoting the figures. Within these national figures, it was generally believed that the Costa del Sol had a large stockpile of new homes, but the relatively low figure of 20,000 has surprised many analysts.
“Obviously, the demand of 20,000 is for a normal year and in the current market, we wouldn’t expect to see this met within a year,” says James Gonzalez, Market Analyst at Obelisk Investment Property. “However, those of us based on the Costa del Sol have seen a massive increase in buyer interest and it wouldn’t surprise me at all to find that by mid-2010, supply starts to lag behind demand.”
James believes that these statistics confirm Obelisk’s forecast that prices next year on the Costa del Sol will experience a 2.5% to 3% growth on 2009 prices. “All the signs are there,” says James, “and the area is undoubtedly top of the investment spots at the moment.”
Statistics from the Association estimate that there are currently slightly over 20,000 unsold new properties on the market on the Costa del Sol. The Association claims that this figure is not high since it is the usual demand for a year. Add to this the fact that there is virtually no new construction taking place on the Costa del Sol at the moment and it becomes obvious that the area is not far off a situation where supply meets demand. Once demand outstrips supply, prices will begin the inevitable upward trend.
Property experts are unanimous that one of the major problems currently facing the Spanish property market is the huge oversupply of unsold new properties. Although there are no definitive official figures, the numbers of unsold units throughout Spain range from one to two million, depending on the source quoting the figures. Within these national figures, it was generally believed that the Costa del Sol had a large stockpile of new homes, but the relatively low figure of 20,000 has surprised many analysts.
“Obviously, the demand of 20,000 is for a normal year and in the current market, we wouldn’t expect to see this met within a year,” says James Gonzalez, Market Analyst at Obelisk Investment Property. “However, those of us based on the Costa del Sol have seen a massive increase in buyer interest and it wouldn’t surprise me at all to find that by mid-2010, supply starts to lag behind demand.”
James believes that these statistics confirm Obelisk’s forecast that prices next year on the Costa del Sol will experience a 2.5% to 3% growth on 2009 prices. “All the signs are there,” says James, “and the area is undoubtedly top of the investment spots at the moment.”
Labels: investment, property, real estate, spain
posted by Alison Kane at 5:07 pm
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