Our company, Hamilton Homes Spain, is based in Sabinillas and we specialise in property sales in the area from Sotogrande to Estepona.
Having been in this industry since 2003, I thought it would be interesting to look back at the property market over this past year, in this key geographic area, and take a sneak peek at what 2019 holds in store for us.
2017 - 2018 has shown a steady increase in property sales, and this has had an impact on property prices. The first six months of 2018 saw prices rise significantly. Gone are the days when you could buy a decent 2 bed, 2 bath property for under 100,000 Euros. Whilst prices are steadily increasing, the market has still not reached 2007-2008 price levels (Idealista).
70% of our buyers are foreign, and despite Brexit, the British still make up the greatest percentage of this group. We have also seen an increase in Spanish nationals buying either first-time homes or second residences. This has been strongly influenced by a negative Euribor and low mortgage rates.
There has been a shift in the supply of properties. In 2014 - 2016, the main stock of our properties came mainly from bank repossessions or property investment funds, and this was reflected in the fact that 80% of properties that Hamilton Homes Spain sold during this time were from these sources. However, the supply of bank properties has fallen significantly, and at present, the main sources of supply are from resales and new builds.
2017 - 2018 saw a significant increase in new builds, with some New Developments being launched. The cranes that disappeared through the years of crisis have reappeared, and there is a good selection of new, quality construction.
We are now seeing a dual market - with the second-hand market offering the same sized properties for considerably less than the new build prices. The pricing for new developments ranges from 2800 - 3000€ per m2. In contrast, the price per m2 on a resale property is substantially less - 1500 - 1800€ per m2. This is partly due to the quality specifications that new builds offer but also partly impacted by changes in consumer tastes and fashion.
We have seen a shift in demand with a higher percentage of clients looking for villa properties. Many clients are seeking properties in the middle market (ranging from 400,000 - 800,000€)
The area between Alcaidesa and Estepona is very well positioned both geographically and regarding price. There has been a big injection of investment into West Estepona. We anticipate that this area will continue to grow. The area is serviced by both Málaga and Gibraltar airports. There are excellent golf courses, including Finca Cortesin and Valderrama in Sotogrande. The prices are still below the peak prices of 2007, but the trend is definitely on the up. A key thing I would say to property buyers in 2019, is not to overlook resale properties as many present excellent value for money. Often it is worth purchasing a second-hand property and refurbishing it.
When clients approach us, we like to take them out for a coffee, discuss their property plan - why do they want to purchase and what do they want from their property? By looking at this, alongside their financial requirements, we are better able to understand what type of property suits each client’s needs, and able to advise whether they should purchase a new build or resale property and discuss finance options with them.
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