At present, Asking Prices, on which Survey Spain’s valuers have to depend for comparables, are not crashing. Yesterday, we started an analysis of the details we get through on a daily basis from Estate Agents and, with only 24 properties, that averages -10.05%, with a minimum of 3% and max of 29%. The larger villas are taking the hardest hits, which is something we had been finding before March in any case. However, we expect there to be a continuing fall as physical absence of buyers and the personal/national/worldwide level of debt, unemployment and consumption of savings takes effect. The threatened ‘second wave’ is also a concern that everything will go backwards. Cheery stuff.
The ‘official’ date of ‘closure’ of the market is interesting, which we’ve been informed is, ‘with effect from the closure of the Spanish Notaries, as at close of business 13.03.2020’. Despite that, we have reports from lawyers of deals continuing to be done by Notaries, by appointment, with signings in record time, as the notary’s office wanted exposure to ‘strangers’ to be as short as possible, as detailed in Part 3 of our quarterly report prepared last month. Our opinion is that as we take our comparison from researched ‘asking prices’, we are more on top of the market than if we were going by previous valuations or notaries or especially Registrar’s records as they can be very delayed.
What will the future bring?
Having said all that, we think that much of the market is just waiting to see what happens, with Spanish and resident buyers and sellers, becoming more active as soon as the notaries and lawyers’ offices open for business. The expat market won’t really ‘waken up’ until the borders open and flights restart. Even then, hesitation at taking travel risks, rumours of all sorts of imagined and real problems, and concerns at the future ease of ‘hopping’ back or out for a long weekend, will reduce the numbers of buyers. They will be partly compensated for by others, for whom lockdown has been the final period of contemplation and they’ve decided that they, and often whole families, decide they have to make a lifestyle change and move out to enjoy the benefits of living in Spain. If there is a radical drop in the normal number of expat buyers, and the economic effects mentioned above starting to crystallise, the result could be a real fall in sales prices.