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January 5, 2017

Real estate prices rose by 2.3% this year and up to 5% in 2018

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Real estate prices rose by 2.3% this year and up to 5% in 2018

The cost of real estate in Spain has grown by 2.3% in 2016 and will increase gradually, reaching a growth by 5% in 2018. This increase will remain stable until the end of the decade, according to the forecasts of the twentieth edition of the "Statistical Annual of the Spanish real estate market, year 2016", of the consulting company RR Acuña & Asociados. According to the published report, the evolution of real estate prices in the different Spanish local markets may be "very different from what is expected for the entire Spanish territory."

In 2015 the increase in real estate prices in Spain was recorded only in 46.8% of the provinces, and the fall in prices is still expected for most of them in the coming years. In addition, it should be noted that the successive decline in real estate prices in Spain over the last eight years has been caused by a strong disarrangement between supply and demand that has characterized the development of the Spanish real estate market, loaded with a really high demand.

Likewise, the strengthening of the demand for real estate in Spain in the big cities and their suburbs, as well as in coastal tourist areas, has been due to the positive forecasts for economic growth and a significant improvement in employment in recent years two years. In addition, there is a growth in demand and sales that will continue at least during the short term, according to official forecasts.

Therefore, the conclusions of the published report focus on the fact that there is a balance in the Spanish real estate market, due to the increase in sales and, besides, the prices are recovering. In addition, according to the study, it is expected that the supply of new housing in Spain will reach its minimum in 2016 with 40,000 finished objects. And over the next two years it is expected that there will be constant growth in very specific areas of the country that are under development and, therefore, the supply of new housing is practically non-existent there.

At the same time, demand for new real estate in Spain will reach at least approximately 82,000 homes and apartments this year. R. R. Acuña & Asociados predicts that in 2018 the balance between supply and demand will almost be achieved with a stock of 341,000 residential real estate objects.

As for second-hand housing, in this case, the supply will continue to grow, and it will be from 40% to 50% of the demand for apartments and houses in Spain. Forecasts for this type of housing indicate that about 330,000 second-hand homes and apartments will be sold each year until 2018, after which the numbers will become more and more moderate.

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