Are we facing a new real estate boom?

In one of our last posts, we talked about the “Prospects for the real estate situation in Spain in 2021”. Today, we want to delve a little more into this topic and analyze one of the most discussed questions lately: “Are we facing a new real estate boom”?

As stated in the “Residential Market Analysis” published by Agora MLS, we could say yes.

The new real estate boom in our country

All forecasts pointed out that in the second half of 2021 there would be a new real estate “boom” and this has been the case. A situation that is estimated to last throughout 2022 and until 2023.

A duration that will be marked by two factors. Firstly, by the magnitude of the increase in house prices and, secondly, by the speed of rise in the ECB’s reference interest rates.

What have been the causes that started the new real estate boom?

• A good macroeconomic and health synergy situation.
• High savings.
• Good financial conditions.
• The lack of good conservative investment alternatives.
• The extension of teleworking.
• The predominance of the purchase VS the rent.

According to the professor, analyst and economic consultant, Gonzalo Bernardos, “en 2021 el incremento del PIB superará con holgura el 6% y en 2022 se situará alrededor del 7%. Ambas cifras darán lugar al mayor crecimiento económico desde la llegada de la democracia, un privilegio que hasta ahora correspondía a 1987 (5,5%). Durante dichos años, las principales causas de la bonanza serán el “efecto rebote”, un elevado aumento del gasto de las familias, la llegada de fondos europeos (37.000 millones de euros) y la rápida recuperación del turismo.”

Added to these causes is the fact that, after the coronavirus pandemic, banks have given priority to loans for the acquisition of real estate.

A factor that has resulted in a mortgage war that has led to a drop in the fixed interest rate. So many homeowners today are benefiting from fixed interest rates of between 1% and 1.5%. Something that is encouraging any interested parties to buy, since profitability now works in their favor.

What is the forecast for the next 30 months?

• May sales continue to increase.
• That the mortgage delinquency rate decreases.
• That banking entities have high liquidity.
• That the risk of granting credits decreases.
• Let there be great opportunities for investors.
• May the “buy, reform and sell” method be successful again.
• That many transformations of premises into homes take place successfully.

From KM2, a real estate agency in Barcelona, we join the advice that Gonzalo offers in this report: “Decidan rápido y adquieran pronto uno o más inmuebles. En una época de bonanza o gran recuperación inmobiliaria, las mejores oportunidades no esperan, simplemente vuelan.”