Although "No one sells a flat and even less on the Mediterranean Coast" is the most repeated phrase among the many property developers in Spain, foreign investment gives a ray of hope to real estate on the Costa del Sol.
The latest data from Tinsa shows a fall of 14.3% in housing prices in these regions during the month of April. It's the biggest drop in Spain compared with data recorded in the same month last year. However, the revival of foreign investment brings hope to a wounded market.
Since the occurrence of the real estate bubble burst in late 2007, the homes of the Mediterranean coast have been drastically reducing their prices and already reached 37%. The gap with respect to the regional capitals and large Spanish cities (which fell by 32%) and other metropolitan areas (-30%) highlights the plight of these areas.
Although the Spanish are just buying homes, let alone a second home or vacation, foreign investors do start to warm encouraged by the decline in housing prices.
In fact, according to
Bank of Spain, foreign investment on real estate on the Costa del Sol last year increased by 27%, after several consecutive years of decline. This trend has remained through the first quarter of the year.
Real Estate on the Costa del Sol:
On the Costa del Sol, real estate investors disbursed 1,900 million euros, representing 40% of the total for Spain. British and German, with 60% and 30% of properties acquired, respectively, are the ones who invest the most, but there are also investors from Nordic countries like Danes and Swedes who are also showing an increasing interest.
The average house price closed last April with a decrease of 12.5% over the same month of 2011, which builds an adjustment of 29.8% since December 2007, when the prices of apartments reached its higher value.
Source: ElConfidencial.com
