Since the crash of the real estate bubble in 2007, and after seven years of continuous decline in housing values, the real estate recovery in 20 Spanish provinces makes a new nod to the housing sector that has suffered so much punishment during this crisis.
According to a report by the consulting firm Deloite , in 2013 only eight provinces showed signs of improvement, this year 2014 twelve more provinces have joined the real estate recovery group.
#1. Provinces with symptoms of recovery
The twenty lucky provinces Madrid, Alava, Barcelona, Guipúzcua, Vizcaya, Navarra, Cantabria, Zaragoza, A Coruña, Lérida, Baleares, Segovia, Valencia, Florida, Huesca, Burgos, Valladolid, Falencia and Soria are the areas that will have the greatest influence on the aspects involved in real estate recovery (mortgages, construction, immigration flows, etc.).
Almería, Ciudad Real, Toledo and Castellón will suffer a greater lethargy , their macroeconomic situation and the excess supply of real estate assets, notably influence this recovery.
The remaining 25 provinces are left for a second season as if it were a television series.
#2. The two Spains
“ There is already a Spaniard who wants
live and live begins,
between a Spain that dies
and another Spain that yawns.
Spanish that you come
the world may God keep you.
one of the two Spains
It must freeze your heart. "
Poem by Antonio Machado
Almost like a prophecy of Nostradamus, Antonio Machado gives us in this poem "the two Spains", a clear vision that the Spanish real estate market is geographically unbalanced .
Apparently there are two phases of recovery that indicate that the north is going to come out before the south. The main reason for this recovery is that construction in the North is not a holiday, however in the South it grew sharply and unstoppably.
To elaborate these data on geographic discrimination, Deloite has based its study by crossing data and variables between provinces, taking out two influential factors in key.
► Group A factors
✔ Quantity of housing stock per inhabitant
✔ The percentage of income that must be used to pay the mortgage
✔ The ratio of rents to sale,
✔ The average price of the apartments
► Group B factors
✔ The Evolution of GDP
✔ Birth rate
✔ % People of home buying and selling age
✔ Migratory flows
✔ The unemployment rate
3#. The effort rate
The average effort rate of Spanish households, that is, the percentage of gross income that a family dedicates to paying its mortgage , has progressively decreased to 33%. This decline is influenced by a 40% drop in house prices since the beginning of the crisis.
The average house price in Spain is 4.4 times the individual gross salary compared to the 6.1 average in the European Union.
All these data will be even more positive when the flow of credit and access to a mortgage is more accessible by banks. Until this fact occurs the real estate recovery in current Spain circulates at two speeds .
Sources of this article: Expansión newspaper
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