Amidst the gloomy conditions and depressing headlines surrounding the Spanish housing market, a recent FT report shows that high end real estate still appears to be holding strong. In the last six months, Savills’ Costa del Sol office have had two €7m sales, one to an Englishman and one to a Gibraltarian, a €5.5m sale to an Englishman and a €5m one to a Russian.
While the mass market is suffering from a glut of new properties, the high-end Spanish property sector is characterised by well-heeled, cash paying high net worth individuals unaffected by high interest rates and mortgage restrictions.
House prices at the top end doubled in between 2000 and 2005 but appear to be levelling off at the moment.
So Where are the Top Selling Enclaves?
Marabella boasts of homes up to €9m or more and is considered one of Europe’s oldest and most glamorous second-home locations.
Sotogrande, is an enclave of just over 3000 near the Valderrama gold club. Homes cost up to the value of €8m here.
In Sierra Blanca, an exclusive community nestled in hills above the town with enviable mountain and sea views has set a new selling record of €18m to a British buyer.
And the Mass Market?
The story as recent news suggest is not at all rosy in the mass market as a property glut rears itself. Places to avoid in the Costa del Sol at the moment are Estepona, Fuengirola and Torremolinos, where several hundred tightly clustered, empty newly built homes remain unsold. Developers who have now halted off-plan sales, are having to cut prices of their current stock by as much as 28 per cent.
Local property agents reckon that the property market would bounce back again with the slowdown and glut straightening out in five years time. Over that period our advice would be to carefully watch the the market for distress sales at bargain base prices.
We’ll be featuring some bargain properties as we come across them.
photo credits: supermac [via flickr]