Buyers from abroad are returning to the Spanish housing market, attracted by economic growth that’s beating most of Europe and signs that prices are bottoming out after years of declines. Britons are the biggest investors as near-zero interest on U.K. savings accounts and rising residential prices make it less attractive to keep money at home.
Non-Spaniards spent 6.05 billion euros on Spanish property in the first nine months of last year, up 30 percent from the same period in 2013, according to data from the country’s Ministry of Public Works. The 40,338 dwellings purchased represent a 27 percent increase from the same period a year earlier, led by Comunidad Valenciana, Andalucía and Cataluña, the data showed.
Foreign and domestic homebuying in Spain evaporated when the economy collapsed during the financial crisis, leading to an international bailout of its banks and the worst recession in the country’s democratic history. An excess of credit-driven construction before the slump led to a surplus of more than 1 million homes, including properties in sunny southern resort areas popular with British and continental Europeans.
Average home prices in Spain fell 42 percent from their 2007 peak, while properties in coastal areas dropped 50 percent, according to Tinsa, the country’s largest home appraiser. Declines slowed to 3 percent last year from 9 percent in 2013, Tinsa said.
Purchases from abroad accounted for a record 13.9 percent of Spanish residential transactions in the fourth quarter of last year, according to the country’s registrar’s office. Britons were the largest group, followed by French and German buyers.