Homes in Marbella (Málaga province) are, in 85% of cases, sold to non-Spaniards, mostly those seeking to retire to Spain or purchasing holiday properties.
As at the end of 2014, sales of villas and apartments in Marbella had shot up by 77% in the previous four years, way ahead of any other location in the country.
And from 2008 to 2014 inclusive – covering the entire financial crisis and housing market crash period – home purchases in Marbella rose in volume by 89%.
In fact, last year alone saw sales shooting up by 28% in the élite Costa del Sol town, compared to a national average of 2.2%, and 12% higher than before the financial crisis kicked in, according to data from Spain’s ministry of public works.
Sales volumes in Marbella did drop off in individual years, but swiftly bounced back, showing the luxury home market is here to stay.
From the 4,432 residential properties sold in 2006, the following year saw a 19% fall as home values throughout the country became inflated artificially, just before crashing altogether.
This inflation period was still happening in 2008, when the previous year’s 3,568 house sales dropped to 2,116, or a fall of a whopping 41%.
But this did not last long: the next 12 months saw Marbella back to growth as the rest of Spain struggled, with a 4% increase in sales to 2,199, and slowly climbing – up 9% in 2010, with 2,389 homes sold, the following year saw a temporary blip with a 5% drop to 2,259 residences changing hands, but since then numbers have been multiplying beyond all expectations.
The year 2012 saw the most buoyant sales figures since the start of the crisis, with 2,519 properties shifting and a growth of 12% on the previous, rather disappointing year; but if anyone thought this was a mere fluke, they would be proven wrong: sales volumes climbed again by 24% in 2013, with 3,115 properties purchased, and in 2014 with a total of 3,997 and a hike of 28%.
Just three houses short of the 4,000 milestone, home sales in Marbella last year far exceeded those of the final year of the property boom and were not much behind sales figures from when the housing bubble was still enjoying plenty of air – and money – being pumped into it.
According to one luxury property agency, which has been specialising in the Marbella area since 1970 and seen its rapid and constant evolution from right in the thick of Franco’s dictatorship through its early years as a burgeoning tourism destination, despite growth in the market and in the town’s property prices, home values in this blue-chip Costa del Sol haven are a long way off peaking.
The agency predicts that current property prices in Marbella are at least 15% to 25% below their maximum possible market value, even in mature, well-established and popular districts.
And in those areas which are more up-and-coming and less of a household name, home values remain lower still, meaning bargains remain out there and even have potential for a very healthy investment return.
Properties in the top price brackets in Marbella are constantly in high demand and low supply, with sellers shifting homes at €1.5 million to €2m often upsizing rather than seeking to release equity – and Marbella sellers have never stopped upping their prices even when the rest of the country has seen owners forced to take substantial cuts.
European buyers continue to dominate the market in Marbella, although unlike other parts of the country, Chinese and Russian purchasers are still being drawn to the area – as are north Americans, given that the US dollar is now stronger against the euro.
British, Scandinavian and Swiss purchasers are now on the increase thanks to the weakening of the euro.
In fact, Brits have been number one buyers in Marbella for the last 37 consecutive years.
French owners are relatively new to Marbella, but are a growing market now that the country is becoming wealthier with greater job opportunities, and society is evolving – whereas once, French nationals preferred to holiday in other parts of their own countries or, at least, no further than just south of the border, they are now found venturing further down Spain’s coasts and their presence on the Costa del Sol is rising.
German and Belgian buyers are now comfortably in the top five; Italy, China and The Netherlands in the top 10 along with Sweden and Norway, and significant growth seen in the Danish, Swiss and Finnish markets.
Another major magnet for homebuyers heading for Marbella is the fact that tourism figures continue to be very high, in light of its global reputation as a luxury destination.
Hotel stays alone, according to the Institute of National Statistics (INE), were not far off 2.6 million last year, with holidaymakers seeking self-catering rented apartments or villas increasing tourist numbers by another 25% – not counting holiday-home owners paying their regular visits to their second property in the sun.
Lap of luxury: What will a million pounds buy you in London and Spain?
Beyond Marbella, however, luxury properties throughout the country are being snapped up at a startling rate, with the high-end expected to rise by a further 6% across the board in the coming year.
And those on a ‘luxury’ budget find their money still goes a lot further in Spain.
In a coastal setting near Barcelona, €1.2m will be enough to purchase a villa with a pool, four bathrooms and five bedrooms, a gym and a cinema in the basement and several spacious terraces.
For a million euros, you can get a four-bed, four-bath mansion with views of a nature reserve near a golf course in Tenerife, a four-bed seafront villa in the port of Alcúdia in Mallorca, or even a 12-bed, seven-bath villa near the beach with a 4,000 square metre plot in Jávea on the Costa Blanca.
Four-bedroom élite and very spacious detached villas with pools and all facilities for total creature comforts in privileged locations can be found for a million in Alaior, Menorca; Nueva Andalucía (Málaga province), or Santa Ponsa in Mallorca.
For 1.2 million pounds, you could buy a two-bedroom flat in Vauxhall, south London; or you could get a six-bedroom, six-bathroom villa on the beach with a pool and top facilities in San Pedro de Alcántara (Málaga), or a brand-new 500-square-metre designer villa with four bedrooms, four bathrooms, a pool and three storeys in Santa Ponsa or in Calpe on the Costa Blanca.
If you could stretch to 1.8 million pounds, you could buy a – admittedly quite large – two-bedroom flat in Kensington on the fifth floor, or instead, a 500-square-metre villa with six bedrooms in Castelldefels (Barcelona province) or a modern, luxurious 1,000-square-metre villa with 13 bedrooms – nine of them en suite – and 10 bathrooms in Finestrat on the Costa Blanca.
And between Vauxhall or Kensington and the sun-drenched shores of Spain, between a two-bed flat and a mansion with a pool, there really is little contest. text: @thinkspain