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Market Report – April 2020


As detailed in Parts 1 and Part 2, the style of the Report this quarter is substantially different from our previous reports, due to the effects of COVID-19 and the actions taken to stop it’s spread.

The Market Opinions

This quarter we have asked specific questions and added to the range of enquiries to include not only surveyors, valuers and estate agents, but also mortgage and insurance brokers, lawyers, architects and others involved with property. Immediately below, is a summary of their responses, with the actual responses below that. We’ve grouped them by profession, and the range of thought and prediction is interesting. The first response was received on the 4thof this month and the last on the 24th April 2020.

It was very gratifying to receive a good response, especially after being threatened of having spammed the property industry on the Costas and Islands of Spain. The consultants bear no responsibility for the summary opinions expressed below.


The questions asked were:

  • How the market was at the beginning of the year, before the virus struck?
    • It appears to have been positive, with some hope for a stronger year than 2019, whilst others were detecting a slowdown. There were doubts regarding over supply and high prices, which tended to create some nervousness.
  • How you think it is now in the shutdown time?
    • Not everything has stopped, with lawyers in particular still concluding deals, though most of these will have started before the lockdown commenced. All are involved in protecting their finances for what could be a prolonged absence of income, but preparing their businesses for when the market returns.
  • The big one. What you think it will be like for the rest of the year?
    • Opinion varies considerably, with some looking forward to a mini-boom, whilst more are concerned regarding the economic effects of the cessation of countries’ trade and the personal losses of potential purchasers and current owners. The timing is expected to be slow, with the majority of 2020 still influenced by and dependent upon the resumption of international travel. However, all are convinced that the merits of Spain, it’s climate, proximity to Northern Europe and Spanish property in general, will see a gradual resumption of demand.
    • Prices are expected to be reduced due to the scarcity of buyers, other than those seeking bargains, and the existence of owners who may have lost considerably in the economic collapse and be forced to accept lower ‘cheeky’ offers in order to raise equity finance.

The Responses: (the Business sector of the responder is given for guidance)

The questions asked were:

  1. How the market was at the beginning of the year, before the virus struck?
    1. Estate Agent: Up until the events of the COVID-19 (C19) Pandemic, my market view was that essentially 2020 would be a fairly steady, if unremarkable year. Prices had already reached unsustainable levels in my opinion and the glut of overpriced new build developments were making the good second-hand property look cheap, whilst simultaneously lowering demand for overpriced, tired properties. When advising clients my main point was not to overpay, probably “wait and see” and be prepared for some kind of significant correction.
    2. Estate Agent: The market at the beginning of the year was very strong with lots of enquiries, lots of clients coming to Spain to look and personally I had good numbers in terms of sales. The prices of the properties did vary from €60,000 upwards.
    3. Estate Agent: My company had a quiet January, but started seeing solid, consistent activity February and the first week of March, which would indicate that we were heading for a similar year to 2019, which was not a magnificent, but certainly a good year.
    4. Estate Agent: The beginning of the year was, in general, quite positive. We had numerous sales and a few projected for April and May. In saying this, there had definitely been a slowdown in relation to the last quarter of 2019.
    5. Estate Agent: Extremely positive!
    6. Estate Agent: 2020 began very well. With Brexit clarified (Out and by when) it seemed that many potential clients were able to make decisions on their intention to buy or indeed on any price adjustments vendors may want to make, but were waiting for the Brexit outcome before deciding. Our pipeline was very strong, and we were looking forward to a very good year.
    7. Estate Agent: We had a good start to the year thankfully. Sales were up 63% on first quarter last year. We were very busy in the weeks leading up to coronavirus with many enquiries from all over the world, particularly Belgium (mainly villas) and UK.
    8. Estate Agent: We had the busiest start to the year with a record number of completions and a higher average purchase price per transaction.
    9. Estate Agent: The market had picked up and was looking a lot better than 2019.
    10. Lawyer: The market at the start of the year was busy, with the reason for this being Brexit and the UK entering into the transition period and the absence of a deal between the UK and the EU.
    11. Lawyer: I think that the market was in a process of gradually slowing down already. Although my activity is not only related to the property market, conveyancing has a certain weight and, without changes in our structure or sources of clients, we have seen a reduction of turnover since 2017. Whereas 2020 has been affected by the lockdown and that may deviate the figures, the tendency seemed to be there in the first two months.
    12. Lawyer: The market was in full swing and we were looking forward to a busy year as the UK leaves the EU with many Brits deciding to move to Spain this year and take up residency.
    13. Project Manager: Construction was still continuing or was planned to start up, but there was certainly some stress in the market and several contractors had overstretched themselves and were going into liquidation. Sales had apparently slumped, but possibly due to the Brexit effect and the fact that things were still unclear and until the end of the year we would not know whether or not there would be a deal.
    14. Mortgage Broker: Market conditions were adjusting continually, mainly because of the outcome of Brexit on 31st December 2019, and the ongoing transition of the “ley hipoteca” regulations introduced last June 2019. The banks were still keen to provide terms for non-residents and the availability of mortgages was good. However, because of various market uncertainties, which still prevail to this day, some banks were withdrawing fixed rate mortgage products for clients who are non-euro earners, and preferred to proceed with higher upfront deposits in some (but not all) cases.
    15. Mortgage Broker: At the beginning of the year we were looking to really push on as finally we saw that Brexit was definitely going to happen meaning that there was some sort of clarity there. Although nothing had been agreed between the UK and EU to what Brexit would finally look like, there seemed to be some sort of progress on the issue and we did see a rise in enquires from British clients who were looking to purchase before the end of the transition period, which was to be 01.01.2021.
    16. Valuer: It was a calm market, keeping active, but with fewer transactions. Prices steady or going around 5% less.
    17. Valuer: The property market at the beginning of 2020 appeared to be slowing, but deals were being done. UK buyers were tentatively returning after the election result, but nowhere near the volume seen in previous years. Again, a polarised market, with expensive and cheap properties most active.
    18. Valuer: The year began with the conviction of the reality of the Brexit and that stage brought at least a clear perspective calming down the anxiety. The nationality of buyers, in the Costa Blanca, mostly British, has been changing in the last year, with increases from other countries, such as the Netherlands and Belgium. The UK market experienced a slight recovery too. In the area of Valencia city and inland the demand has been strongly reinforced by American buyers. No major new developments were expected in coastal areas in this year. In the city of Valencia a few complete refurbishments of buildings, in order to change their use from residential to hotels. Tourist rental properties have been one of the major investments, providing a substantial support to the real estate market, reinforcing the businesses related to the tourism. Offer prices have not had relevant movements. Significant increases of bank valuations were seen to provide loans.
    19. Valuer: The sales market before the shutdown was without change from the previous quarter.
    20. Valuer: At the beginning of the year, the market was already showing signs of easing up, both in terms of sales and price increases, after about 6 years of progress.
    21. Insurance: The market for the first 2 months of the year was steady, but unspectacular. Health insurance continued to boom due to the requirements for residencia, and general insurance was in line with the same period last year, albeit in a very competitive market.
    22. Insurance: I think we exited 2019 and entered 2020 with a feeling of concern about the property market. It was generally accepted that there was an oversupply of new developments and that demand was not keeping pace. Banks had already started to tighten their criteria on availability of development finance and there was considerable worry about the global economy adding to the uncertainty.
    23. Newspaper: There is hearsay evidence of a considerable increase in the number of British buyers, perhaps wanting to acquire before the final Brexit separation at the end of this year.
    24. Newspaper: It is anticipated that the Corona Virus could have an increasing effect upon travel and therefore demand, but as yet we have no market evidence.
    25. Newspaper: A developer reported an increase of 125% in UK buyers compared with December and January 2018/2019. The Registrars reported that Andalucia was the most popular place for UK buyers, being 20% of the total. The strength of the pound will have had a major influence.
  1. How you think it is now in the shutdown time?
    1. Estate Agents: Developers are now stressing full refund of deposits for buyers reserving property, but changing their minds within a month. (Something they would be obliged to do most times in any case!)
    2. Estate Agent: The pandemic measures in place have created unprecedented conditions for buyers, sellers, landlords, tenants, investors, agents, banks and lawyers. From what I have heard, there are a handful of panic sales being agreed, but completing the sale is proving very difficult. Also, I know of a significant number of sales that have fallen through. Another significant issue that is still unknown, is how the banks react to post-C19 conditions. I suspect that they will be very restrictive, and as history has shown, unfortunately, pass on costs to borrowers.
    3. Estate Agent: Having received my performance statistics from my web people, the figures have still been good in terms of the number of people visiting my website. The number of enquiries has dropped, which is totally understandable, but still encouraging considering the situation which we find ourselves in. I have also had positive feedback from clients who were due to come out in March / April, saying they will re-book when they are allowed to travel.
    4. Estate Agent: The market has come to a standstill with the exception of a handful of enquiries from portals and my own clients. All appointments and scheduled visits I had from mainly Scandinavian clients have been cancelled and our office has been closed for nearly three weeks. We are unable to take clients on viewings even if they were here due to the complete lockdown still in place.
    5. Estate Agent: Proposed deals for April and May are of course on hold and we are not sure if some may ‘fall out of bed’, with buyers losing jobs and banks modifying the mortgage conditions. It remains to be seen if we don`t lose more. During the Shutdown, it’s very, very difficult, in trying to keep everybody positive and the obvious difficulties in not being able to view properties. We have spent most of our time, reassuring both buyers and sellers, that things will get back to some sort of normality.
    6. Estate Agent: we are doing deals! It’s very difficult, but to be honest we have not stopped and are spending the time accomplishing all the tasks we never normally have time to do.
    7. Estate Agent: We are now suffering the worst. Now it seems no one has energy to even think about buying or selling property. The only incoming mail we have are from service providers looking for work in real estate related activity. Painters, plumbers, home maintenance companies etc…..
    8. Estate Agent: Within the shutdown period we have received three offers. One of 130k on an apartment listed at 160k (rejected); 100k on an apartment listed at 199k (rejected); 950k on a villa listed at 1.6m (rejected). These are all from potential purchasers who viewed properties at the beginning of the year, but were unable to pay the minimum prices required by the vendors. They have all been hoping to gain from others misfortune during the coronavirus crisis. We’ve also had one buyer who has decided he cannot go ahead on a purchase despite potentially losing the 10% that he paid on exchange of contracts. We have received no new enquiries since shutdown and a couple of vendors have removed their properties from the market for the time being.
    9. Estate Agent: The market has virtually stopped in terms of new enquiries. Banks are still processing our mortgages and completions still taking place, all be it at a slower pace.
    10. Estate Agent: With the shutdown, it’s a disaster. I will be surprised if clients will contemplate flying for some time and this will be a very hard year for everyone.
    11. Lawyer: The market is of course very quiet at the present time. However, we have acted for clients wanting to enter into a private contract so as to ensure the purchase or sale of their property when the current crisis is over, and they can attend the Notary.  The Notaries are open, but only if the Notary is of the view that it is an emergency. Spanich real estate of Mediterranean seashore, Mallorca
    12. Lawyer: The plans and the market are on stand-by for the moment, some may say life support. We have seen a few cancelations of recently generated deals. Some clients have moved to a conservative approach and, without disregarding of the purchase of the property, they have simply postponed it. New clients are virtually non-existent since mobility is dramatically reduced and it could be said that the number of new deals is not significant, although there are a few. Real Estate agents may still be active, but surely the deals will not be closed until clients can fly over.
    13. Lawyer: We are still receiving instructions from clients wishing to buy Spanish property and we continue to act for those already in the buying and selling process. Notaries are only signing urgent matters so this will create a bottleneck of purchases/sales when we come out of lockdown.
    14. Lawyer: Not much information on this can be provided. We are not doing much conveyancing at present.
    15. Project Manager: All construction is stopped and unless the companies have reserve funds then I expect there will be several companies who will fold. The government ERTEs may help; however, the smaller companies with only a few workers may not be liable for that. Likewise, agents have had to close and are not allowed to show properties, so as with the contractors, I can see several closing. It may clear out the market.
    16. Project Manager: At present the impression is current projects are continuing as allowed by Government. What is interesting is the attitude to new projects, with a range of wait and see to proceed full ahead.
    17. Mortgage Broker: The good news is that little has changed since then and the banks are still underwriting mortgage cases (meaning clients can get mortgage approvals) and a number of valuation companies are still visiting properties, generally with positive results up to this point. We’re aware of notaries who are still completing on purchases despite the process having slowed considerably. In the week following the introduction of the state of alarm in Spain on 14th March, we saw a 67% drop in mortgage enquiries compared to the previous four weeks. The good news is that since then we have seen the number of enquiries steadily increase. Last week the number of enquiries was almost four times the number we received in the first week of the lockdown, so we hope we are seeing the start of what will be a long-term recovery, but clearly nothing can be taken for granted during these times. Whilst the new enquiries are from clients at the very beginning of the process of potentially buying a property – they may not even be contacting the agents to enquire about properties yet – it is comforting to see people still intend to buy once the coronavirus situation has subsided and are already thinking about finance. We are seeing more enquiries from clients who may previously have been cash buyers; who have either seen their share portfolio fall in value or who simply want to hold on to their cash while borrowing is so cheap. We have also seen an increase in clients enquiring about bridging finance on commercial and residential real estate purchases, where clients typically need to borrow for 1-3 years and repay the debt at the end of the term. Although some investors are buying off-plan or buying via virtual property tours, most buyers – especially those who are buying for personal use – want to visit the properties after the travel ban has been lifted, whenever that may be.
    18. Mortgage Broker: The banks that we collaborate closely with are trying their best to work to a business schedule from home during this temporary time. Some offices and branches do open limited hours with limited staff on site; however, the majority work from home where possible including underwriting and risk teams. The availability of mortgages themselves has not been affected by the shutdown.
    19. Mortgage Broker: At the moment the Spanish property market is basically on shut down. No one can come to Spain and view properties; many valuers are not visiting properties; and some notaries are not opening to complete property deals unless there is a clear reason to do so. This is understandable considering the COVID situation. Banks are still open for new business and are still approving new mortgage applications subject to the properties being valued, so we can prepare new cases in readiness for when the market reopens, which we hope happens soon. I don’t see there being a massive credit crunch as happened in 2008 / 2009, and we should see governments and central banks come up with a liquidity plan to ensure banks have enough cash to pump back into the market, as and when it is needed. The Spanish banking system is not a concern to us at this stage and we expect interest rates to remain very low given the negative effect COVID 19 is having on global economies. I believe that once Governments or the medical profession get to control the virus, I do see that the market can recover fairly quickly, but this does depend on how long this crisis actually lasts for.
    20. Valuer: Totally quiet, almost no transactions, and if one happens it was bought just before the shutdown.
    21. Valuer: The market is now shut for business. Many estate agents’ bosses I have spoken to have adopted the governments furloughing. Many agents are not positive about their job prospects.
    22. Valuer: The shutdown has drastically cut the real estate activity to zero. No viewings, valuations and sales. All consulted agents confirm the non-existence of operations from middle of March and no visible operations in April. The tourism business and incomes expected for Easter disappeared, as did the majority of reservations for the summer period. Construction maintains a low activity, finishing works.
    23. Valuer: Disaster struck, and the market is now paralysed. It is almost impossible to obtain post crisis evidence.
    24. Insurance: I suspect that during the lockdown, activity has pretty much ground to a standstill. Society, encouraged by governments worldwide, has put everything non-essential on hold, and the instinct for survival has kicked in, leaving other decisions such as purchase of holiday homes on the back burner.
    25. Insurance: We have seen a massive drop in new business during this time, but we are fortunate in that we have residual renewal business, which has continued to flow despite the lockdown. Dealing with clients via phone and email has meant that we can continue to do business at a time when many companies have come to a complete standstill
    26. Newspaper: UK searches for holidays in Spain in 2021 skyrocket by a staggering 1,600


  1. The big one. What you think it will be like for the rest of the year?
    1. Estate Agent: We doubt people will be allowed to come into the country until well into the summer. We think prices will fall but owners won’t drop their prices in general enough to sell. We think buyers will expect all prices to drop equally across the board, but that will not happen. Rental availability will increase due to the destruction of the Airbnb business model. Certain types of properties and properties with certain features will become more popular.
    2. Estate Agent: Many of my peers have consistently remarked that my market view pre-C19 was negative. My reasoning for this still stands. Asset values across all classes were overvalued. There was absolutely no way we would not see a big correction triggered by some kind of “Black Swan” event. Now that these events have unfolded, we are looking at conditions that will make 2008 look like a “walk in the park.” The Federal Reserve has predicted a 32% rate of unemployment in the U.S.A. These figures were released over a week ago, since then the data looks worse. If we are to assume the richest country in the world experiences these kinds of figures, then we can assume the situation across main European investor countries for Spain will be similar. This will knock the stuffing out of pensions, equity-release, domestic house sales, and savings. In short, I can’t see less than a 30% drop in values across the board. However, I would say that in some overpriced markets the drop could be as much as 50%. Although the pain felt will be extreme, fundamentally, I see long term benefits for the overall health of the market. For those in a position to buy without lending or with flexible lending already in place, the market will be a treasure trove. A handful of my clients are already enquiring about any interesting buys. Pressure on currency, available cash and from loss of income will surely put a large percentage of sellers in dire straits. The fact that this cycle has been started by a virus, makes everything more difficult to predict, but however this downturn started, there was always going to be a big downturn as we have been floating in a bubble for too long.2020/2021 Calendar with a house marker
    3. Estate Agent: The big issue is when Spain will start to allow flights back into the country. While we may get the restrictions lifted here, how long will it take for other countries to lift theirs i.e. the UK, so it really is a case of being patient and seeing when things get back to some form of normality. Personally, I think it will take this year for people to regain their lives back, which includes financially, so I think the market will tick over and there will be steady sales, but nothing through the roof. I also wonder how this will affect the new build market, which I felt was starting to become too expensive compared to what you can buy as a re-sale.
    4. Estate Agent: I wish I knew – nobody does. I am by nature an optimistic, positive person, but even so my gut instinct tells me that we will not see any significant business until September/October at the earliest – I obviously hope I´m wrong.
    5. Estate Agent: I can’t see the market recuperating until the last quarter of the year, going into 2021. This depends massively on the global markets and currency. I am staying positive.
    6. Estate Agent: We have written off until Summer 2021, but still expect to be doing business, but only between motivated sellers and buyers who understand the market. For educated buyers, this is the time to make some money and where safer than property? For those businesses like ours that went through the last financial crisis intact, we have a lot of experience to draw upon, we were very well prepared for this crisis, thankfully.
    7. Estate Agent: Your crystal ball question is so difficult. It is much too early to say. All depends when confinement is relaxed, and when we will be able to travel again. Buyers of second homes are relatively wealthy and will have been hit hard financially. We will undoubtedly face a long period of time with few enquiries and a growing number of nervous vendors looking to liquidate their second homes because they have to! The recovery cycle will be similar to past recoveries. At first, we will have some distressed vendors supplying opportunistic buyers.
    8. Estate Agent: I think it may take a little time to normalise, but that it will come back again quite quickly. I believe the banks will continue to lend according to their criteria as has existed over the last few months, which have been mainly driven by the new mortgage laws of June 2019 and Brexit.
    9. Estate Agent: The rest of the year will be a total loss for real estate agents and if it does recover it will be very slow. We hope that clients are looking at property on the internet now and will come out as soon as they are able, fed up with their home and looking for somewhere else, but I think a lot of people will stay closer to home. Later on, a lot of people who lost money on the stock market will look at going back into buying property as it’s safer, so we may see a surge later on, sooner the better we all hope.
    10. Estate Agent: My crystal ball is looking a little cloudy on the future. For us it will depend 100% on lifting of travel restrictions. On the one hand, I think people who have money, but who have been stuck indoors, will be looking forward to spreading their horizons and making the most of lifestyle opportunities available in Spain; on the other hand, so many people are going to suffer from such a drop in income this year, the next 18 months or so could be devoid of any luxuries, travel, holidays etc. There will always be the chancers looking for the distressed bargains. During the last crisis we didn’t see many bank repos or financially distressed sales – if any sales were distressed it was for health/ageing issues more than financial. However, over the past few years we have welcomed a new dynamic, with many younger families buying in the area with mortgages. It may be that we find some of these families unable to continue to pay their liabilities in Spain and having to sell at reduced prices.
    11. Rental Agent: I’m also hoping that travelling Spanish tourists from say Madrid, etc, will favour villas and private accommodation over hotels…so they can continue social distancing as they shop, but can enjoy the weather and swimming pools with families in private villas….it’s maybe my only silver lining.
    12. Rental Agent: If Spain were to open the borders and resume flights, as one of Europe’s top destinations, it will invite millions of potential carriers from all over Europe, from countries with outbreaks at various stages, UK, France, Italy, Middle East, US, Russia, China. They all come for a few weeks and return home leaving the Spanish Costas as an enormous, uncontrollable petri dish of death tolls in hundreds of thousands. I know it’s pessimistic, but I think it’s actually logical and realistic. It’s a nightmare scenario, but as much as I’d like to wish this pandemic will disappear in June all over Europe, and all of a sudden we are all immune, or vaccinated, etc, it’s foolish to think so. It’s a nightmare for me. If the wishful think scenario above transpires, I would probably be fine. The closed borders scenario is a nightmare for my business, all our businesses, Marbella and Spain as a whole. But the worst case petri dish scenario is equally as bad. And I expect France, Italy and maybe all of Europe will keep borders closed for the same reason I’m hoping that after summer I will begin to take booking for 2021 again, inc. the 2020 booking I’ve rolled over for a year at client request I am going to focus on getting clients from other parts of Spain rather than abroad for summer 2020.
    13. Lawyer: We expect the market to be busy for the rest of the year once the crisis is over; if the crisis continues it will be quiet. Once the crisis is over, buyers from the UK are looking to move to Spain and apply for residency prior to the end of the transition period 31.12.2020. The reason for this is the uncertainty as the UK has not done a deal with the EU to date. At the present time pensioners can get their S1 and UK citizens can apply for residencia and nothing has changed.  Post 31.12.2020 nobody knows what the position will be re residencia and pensions so buyers from the UK are looking to purchase before 31.12.2020.  As a lawyer, I suspect from my own personal experience that citizens of other countries are perhaps waiting for perceived bargains.  There may be some bargain properties, but I don’t expect this to be the case until after 31.12.2020 and this in my opinion will be dependent on whether there is a deal between the EU and the UK.
    14. Lawyer: I am certain the market will swing back into action as soon as the lock downs across Europe are lifted. I am optimist and, if the world situation permits, we should see a gradual recuperation in the market in the Coast. I think property prices will see an adjustment, but the activity will recover, perhaps by the last quarter of the year, not yet full speed possibly though. I also like to think that, after the lockdown, a number of people will have a different view of life and will not want to miss the opportunity of enjoying their holiday home in sunny Spain. We will see recuperation.
    15. Lawyer: If the lock downs in Europe are lifted by mid to late June, I believe that Spain will have a very busy summer with record bookings because there will be a holidays price war and people will want to travel to a safe country. With those bookings, the property market will pick up speed.
    16. Project Manager: Talking to the agents I deal with, there is a variety of opinion. From the market will crash in the next few months as no one is going to be able to visit, to quiet optimism at the thought the market will come back towards the end of the year, which, having watched the news, is what some are predicting.
    17. Project Manager: The market will be dead for some time until people recover financially, because even with government help throughout Europe, people will take a hit. I know there are still developers who wanted to start up, but are now weighing up what to do. There is already an over stocking of properties that have to be cleared first. I think that 2020 will be flat all year with things picking up next year. Pray for a bad winter in Northern Europe for a boost in sales.
    18. Mortgage Broker: Impossible to say! It completely depends on many factors such as how long not just Spain is in lockdown, but all other foreign countries also. Mortgage products will still be widely available, and will still be required by buyers whenever in the future that may be, and we will be very well placed to assist them with the connections and business collaborations built up over many years.
    19. Mortgage Broker: 2020 is going to be a completely different year to what we were expecting at the beginning of January. Spain having to go on lockdown will affect yearly property, new mortgage and re-mortgage figures. Spain is very reliant on tourism from other countries and as long as visitors from abroad are restricted in coming to visit us here, then 2020 will be a very tough year. This is true of the property market especially on the Costas. If Spain were to remove the lockdown for its residents, then the property market for nationals could get going once more. If we see that other countries such as Britain and Holland are behind Spain with getting the virus under control, then I can’t see how Spain would open its borders allowing these citizens to come back to visit us. There are too many variables to take into account and no one knows how long it will take for this pandemic to control, so all we can do is shelter ourselves and our loved ones. Also our business, to come back to when the threat has disappeared.
    20. Valuer: Next month there will be almost no activity, waiting to see the consequences of this shutdown. When the Economy begins to move, it will appear another time with new transactions, but growing slowly and probably not like before shutdown. Prices after shutdown will keep steady, but probably with a slight discount to try to be more attractive.
    21. Valuer: Sadly, I’m not expecting a swift upturn in activity. Limitations on international travel, lack of investment and the return of high local unemployment will not help the market to recover. Locally, we have a huge dependence on tourism, so hoteliers and holiday rental owners have been hit very hard.
    22. Valuer: The health crisis will lead to a deep recession and crisis in an area where the tourism and the foreign demand represent the major source of incomes. This demand will be recovered once the origin countries overcome the health crisis, which presumably will be happening after the summer. After months of no sales, and a lost summer for all businesses related to tourism, substantial reduction of offer prices and a high unemployment percentage are expected. The recovering to a previous stage before the lockdown will require at least two years, due to the traditional weakness of Spanish enterprises and the almost non-existing Government support for self-employed and small enterprises.
    23. Valuer: The rest as of now and in the future is anyone’s guess. Could be a drop in prices, unlikely to be a rise, likely to be vultures looking for repossession bargains again. I would suggest that with many workers being made unemployed or on an ERTE, there could be a fair few looking to put their second homes for sale to generate some money to live on in the future. I also think there will be a switch of short term lettings controlled by Airbnb and booking to long term lets. Not all of course but some, which I think will lead to a reduction in the monthly cost of long term lets.
    24. Valuer: Once the lockdowns are over, things will very slowly start to recover, but it will take time for flights to resume etc, so little more is likely to happen for the rest of the year, other than modest price drops. The damage to the Spanish economy, and indeed other economies, will be more long term, so local markets expected to be sluggish and expat markets too. UK will be particularly badly hit with the double wammy of Brexit and the crisis. I am expecting price falls of no more than 10% this year, but next year, who knows!
    25. Insurance: If only we had a crystal ball! Much will depend on the progress of the virus, and the potential easing of lockdown conditions not only in Spain, but the rest of Europe. If the predictions of a summer with virtually no foreign tourism on the coast are correct, it could be a hard slog for everyone in 2020, so let’s keep our fingers crossed that things return to some sort of normality sooner rather than later.
    26. Insurance: The $64M question!! Our property market on the Coast, remains for the large part to be a secondary home market ~ i.e. one that flourishes when buyers of these secondary homes have cash available and are feeling secure and confident. The economic scenarios being painted by many expert observers paint a very worrying picture once we emerge from the current lockdown, with shrinking GDP for most of the countries whose residents buy property in Spain, corporate failures, rapidly escalating unemployment, etc.. We will also see increased taxation, and quite possibly economic meltdown in Europe as the countries of Southern Europe struggle to cope with the colossal debt, high unemployment, corporate failures and fallout of several weeks of economic paralysis, which, depending on how Brussels and the Northern European countries respond, could put the whole European Project and the Euro itself in grave danger. That is to say nothing of the serious potential for social unrest in certain areas, and a possible reduction in capacity of flights to Spain as airlines struggle to stay afloat following several weeks of inactivity. All in all, 2020 is in my opinion going to be a very difficult year for Spain in general, and Costa areas in particular, and the property market will undoubtedly be affected with a contraction in demand and price reductions from developers keen to reduce stock. I wish it were more positive, but with the facts as they are, I cannot see how it can turn out differently.
    27. Newspaper: Following demand from many foreign residents owning properties in Spain, the department of Tourism in Andalucía is looking into the logistics of allowing residential tourism to resume safely after the current lock down is over, and once Spain’s borders are reopened. There are rumours of restaurants being opened towards the end of May and Hotels in June, but they will be different, perhaps less convivial places, with all the social distancing that will be required. Even the beaches will have to be controlled to prevent close groupings.
    28. Newspaper: Almost a fifth of companies listed on Britain’s blue-chip FTSE 100 index have now cancelled or postponed dividends, with that number likely to rise as a nationwide shutdown persists. “While 2020 will go down in history as the year stocks collapsed and dividends dried up, hopefully the world will get back on its feet and return to normality before too long.” The loss of income is bound to affect the availability of holiday and second home finance.
  • General Opinion from Survey Spain
    • The lawyer can make sure the paperwork is correct, but if the house is not accurately described or has physical problems, the buyer will have the inconvenience and cost of sorting those out. Those future problems that can be avoided by a survey. We are as important as a lawyer. The estate agent is being paid by the seller, so can’t be an independent adviser.
    • In preparing a valuation, we identify comparable properties similar to the one we have to value. From our experience of location, style, etc, and often from knowledge of the comparable property, we can compare the pros and cons, and arrive at a value. We compare with the asking price at the time of researching and may not know whether that has been recently adjusted for the ‘new’ situation or not. There is the probability that some will have dropped prices to try to sell ahead of the market. Therefore, at present, our answer has to be that the virus effect has not yet really been seen in prices, but the lack of buyers able to visit, the longer term unknowns such as flight availability and costs, and currency fluctuations, could make some buyers who are desperate to sell, be prepared to drop their prices significantly.
    • An FX company mentioned, ‘Although it is not possible for UK clients to come to Spain to view properties due to the travel restrictions,’
      • As independent and trusted professionals, Survey Spain can inspect properties for potential buyers, providing from the minimum of merely a drive by and commenting on the general ‘tone’ of the area and any cautions; to full building survey condition inspections where we comment on everything to do with the property, as if we were going to buy and live in it ourselves.
      • This service is especially appreciated by buyers of off-plan property that has now been granted First Occupation Licence and their lawyers are informing them that now they must sign and pay for the property. Power of Attorney for the lawyers sorts out the signature and paperwork, but what of the condition of the property? Has it been properly finished in full to the agreed specification? We can carry out the ‘snagging’ survey, where again we are independent of developer, builder, estate agent, etc, who are all dependent on the sale going through to receive their payment, and so might not be as diligent as to specification detail and quality as we will be.
    • It is reported that more than 1.5M ‘foreigners’ have left Spain due to the crisis. Most were tourists, those in holiday homes, students, or the like. Individuals mean consumption of goods and services, so that will mean a further hit on local and national economies. There will have been some balancing as Spaniards abroad will have returned home.
    • According to the Property Registrars of Spain, 2019 saw the first drop in house sales for 5 years. Valencia sold the most houses (27% to foreigners), with the Balearics third (42% to foreigners) and Andalucia fourth.
    • In January, we cautioned that the private funds that had bought in the middle of the financial crisis were selling to late arrivals, perhaps sensing that the run in values is losing steam. Whilst nobody knew what was just round the corner, these early funds must be thankful for their actions. I hope that they were prudent with investing the proceeds. We must remember that often these funds may be the basis of pensions and even health insurance pay-outs to individuals and families around the world.
    • Spanish banks are no different from others in that they still have bad credit debt portfolios. Many are corporate and this crisis could make it impossible for them ever to recover the loan. For individuals such as the mortgage payer in default, the tenant struggling to pay the rent, or the individual who has maxed out their credit, these are times of increased stress. We can only hope for understanding and compassion from ‘owners’ of their ‘debt’ with a financial margin, but who also have responsibilities and dependence on the income and debt repayment. The Government and charities can help to some extent, but survival and getting out of the situation depends upon individuals and supportive relationships.
    • Brexit will be harder due to the shut down of countries and the reduction in the Global market. The timing must be changed to give more of a chance for reasoned discussion, but that will spread the uncertainty even longer. With nothing being agreed until it’s all agreed, expats, businesses and travellers cannot plan. It will suddenly be done or not as the case may be, and there will be an almighty rush as everyone on both ‘sides’ tries to make the best of it. Currency exchange, so important for the property market, will fluctuate throughout the negotiation period, adding to the uncertainties and thus delaying decisions. We are going through hard time and there is more to come before it gets better.
    • The Climate Crisis is still with us, though skies, rivers and seas are clearer. The world doesn’t need us, it can carry on in balance without humans; but humans need the world. We must understand that it is finite and find a balanced alternative to growth economics. We cannot go back to how it was before. It is as true for individuals, as it is for businesses and countries.


Thank you all and compliments on your frankness, in alphabetical order –

Arquitectos-Peritos-Tasadores                         Barcelona Investment and Management

Bromley Estates                                                   Campomar Real Estate

Complete Spanish Property                               Costaluz Lawyers

Dallimore Marbella                                             Dolphin Estates

Eguren Asesores                                                  Fluent Finance Abroad

Ibex Insurance                                                     Iustalex Abogados

Jaimie Hamilton Millan                                     MADE Marbella Design & Development

Mortgage Direct                                                   My Lawyer in Spain

Noll Sotogrande                                                   Olive Press

Op de Beeck & Worth                                          Paraiso Real Estate

Property Works                                                    Renson Management

Spain-Holiday                                                       Survey Spain Valuer Almería

Survey Spain Valuer Tenerife                            Survey Spain Valuer Costa del Sol

Terra Meridiana                                                   The Finance Bureau

Valencia Property                                                Wasa Real Estate


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