Spain's residential market will remain under pressure for the next two to three years as UK buyers turn to new markets, according to Andrew Williams, managing director of Cushman & Wakefield Residential. 'UK investors buy twice as much residential property in Spain as any other group of foreign investors,' he pointed out. 'But competition is increasing from alternative markets such as Turkey, Central and Eastern Europe, France and Italy. UK buyers are also tapping into markets in South America, Dubai and Southeast Asia,' he added.
Spain's residential market will remain under pressure for the next two to three years as UK buyers turn to new markets, according to Andrew Williams, managing director of Cushman & Wakefield Residential. 'UK investors buy twice as much residential property in Spain as any other group of foreign investors,' he pointed out. 'But competition is increasing from alternative markets such as Turkey, Central and Eastern Europe, France and Italy. UK buyers are also tapping into markets in South America, Dubai and Southeast Asia,' he added.
Williams was speaking at a panel discussion Tuesday on the first day of Barcelona Meeting Point, one of Spain's leading real estate fairs. Andrews predicted that the secondary and tertiary markets would be hit hardest by the current slump in Spain's residential sector. 'The Spanish residential market is diverse. There are different subsectors and different curves. The urban market in cities like Madrid and Barcelona are coping quite well. It is the one- and two-bedroom apartments in densely built areas along the coast where we will see the largest fall. That market will go first. The top end of the market for villas and larger second homes will do better, it will probably stabilise and may even grow further.'
Citing media reports that thousands of properties along the Spanish coast may be bulldozed because they are located too close to the beach, Williams added that uncertainty about land title could cause a crisis of confidence among foreign buyers. 'You might expect such reports in China or Russia. But in Spain UK buyers would expect land title to be sacrosanct.'
But the news is not all bad, Williams said. 'Spain is a big country and the underlying economy is strong. Tourism is a big sector, and Spain remains the second biggest tourist destination in the world after France. Spain has the capacity to emerge quickly from this downturn. An investment recovery play could take place within two years.'