The golden stage of the real estate market is ending

sipon80

Still far from being considered a change of cycle, the Spanish real estate market is experiencing what could be the end of the golden period it has experienced after the pandemic. The constant increases in interest rates by the European Central Bank (ECB) - which last Thursday announced a new increase to 4.5% - have cooled home sales figures.

According to a report published by the General Council of Notaries , during July 2023 - compared to the same period of the previous year - the purchase and sale of Email Data homes fell by 18.4% and the granting of mortgage loans for the purchase of a home fell by 25. 7%, while the incorporation of new companies registered an increase of 5.1%.

Housing sales and average prices Source: Notarial Statistical Information Center (provisional data for the last 3 months). (*) Gross series in centered 3-month moving averages.

In general terms, in our country the number of sales decreased to reach 57,255 units and the average price per square meter stood at 1,617 euros per square meter, registering a decrease of 4.6%. Despite these drops, experts say, the numbers are still positive.

Despite the drop, the moment is "spectacular"
For Ricardo Gulias , CEO of RN Tu Solution Hipotecaria , analyzing the current housing situation is not a question of seeing if it has reached its ceiling, but rather that "different variables" have come together. Even so, we are at spectacular numbers . Buying a home is a process that requires meditation, so the current situation, marked by the highest interest rates in recent times, favors greater " caution" on the part of buyers. Ricardo Gulias, CEO of RN Your Mortgage Solution.

We are coming from an extraordinary moment in the market after the pandemic, which made us realize where we were living and think about where we wanted to live. That, together with interest rates around 1%, made it sell like crazy. Now, along with the problem of interest rates, what real estate companies find is that there is little product, both new construction and 'potable' second-hand. Even so, the moment is still very good because we are coming from a spectacular year ," explains Gulias.

The percentage of home purchases financed by a mortgage loan stood at 45.9% this year. Furthermore, in this type of purchases with financing, the amount of the loan represented on average 70.2% of the price.

A rumor in the real estate market
Experts believe that we are at an inflection point, a time when buyers are waiting for what happens first: for house prices to fall, or for interest rates to do so.