COSTA BLANCA 2018. RISE OF PROPERTIES TRANSACTIONS. WHAT ABOUT 2019?

Purchases of properties to foreigners increased again in 2018 with respect to the year 2017 in the whole Costa Blanca – Alicante. It has been reached the number of 23,000 sales, representing an increase of 7% compared to 2017. (source: Información – Alicante Newspaper).

It seems that the adverse international context, such as the economic slowdown in the European Union, and other conflicts such as the trade war between the United States and China, have not managed to stop the increase in the number of purchase and sale transactions that have taken place in the province of Alicante.

The main reasons for this increase are mainly concentrated in:

– Prices: They remain low – The good quality of life in the Alicante area – Infrastructures: Services, communications, quality Public Health – Airport connections – Professionals: Promoters, Agents, Lawyers, Economists of high quality and with a broad orientation to the international market.

In addition, the policy of low interest rates in the economies of the different countries, which causes a very low profitability in both funds and bank deposits, favours the investment in the real estate sector, with a prominent place in Spain, and specifically in Alicante, as destination of these foreign investments. These investments aim not only to obtain a second home, or even a permanent one, but to obtain higher investment returns in the future or in short term with rentals.

Again, it is still the British market that is on the head in the number of purchases, reaching to the top with 5.000 properties sold during the year 2018 to British nationals, and that has meant an increase of almost 10% with respect to the year 2017.

UK is followed by Belgian nationals, who continue to stand at around 2.500 sales transactions carried out in 2018, then Swedish, which have bought around 2.400 units sold to these nationals in 2018, French nationals with 1.400 units, Germany, with 1.300 units, Norway, with 1.200, Russia, with 1.100, Holland, with 1.100, and other countries, below 1.000 units.

Those markets that have supposed an special increase with regard to the previous year are, mainly, Holland, which has risen 12%, and the United Kingdom, with an increase of almost 10%, Russian market, and Germany around 7%. Staying stable (maybe somewhat down) the Belgian and Norwegian markets. As we can see, the most significant increases have taken place between Dutch, British, German and Russian nationals.

As for the outlook for the year 2019, it seems that it will remain stable. However, different points of uncertainty such as those mentioned above are still present, and, above all, the Brexit.

But, the reasons that encourage foreign investors to decide for Spain such as low interest policy, low inflation, and investment products at reasonable prices, indicate that also the year 2019 will be a favourable year for the real estate market in the province of Alicante, and the Costa Blanca.

*Information provided by a Solicitor - article can be found here