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PROPERTY

Spanish property news: Buying in 2022 and how to sell your home in days

In this week's property news roundup we cover new energy efficiency rules for Spanish homes, the drop in demand for rural properties, price forecasts for 2022 and a new way to sell your home in Spain and being paid in full within days.

San Sebastian properties Spain
The beautiful northern city of San Sebastían, where house prices are often higher than in Madrid or Barcelona. Photo: Jochem Raat/Unsplash

EU targets Spain’s energy inefficient homes 

Brussels is looking to prevent homes in Spain from being sold or rented out if they consume too much energy. 

The European Commission’s “Fit for 55” plan will see Member States having to meet minimum energy standards for themselves by 2030, including for all types of residential properties with the exception of historical or religious buildings.  

In practice, this means that Spanish homeowners with the lowest energy efficiency classification – G – will have to upgrade their homes in the next decade to gain at least an F certificate if they wish to sell their properties or rent them out to tenants. 

Even though homeowners may have to foot part if not all of the bill, there are a number of home improvements Spain plans to offer tax deductions for, which you can read about below. 

READ ALSO: Property in Spain: the home improvements you can get a 60 percent tax deduction for

Pandemic’s lease of life for ‘empty Spain’ wears off

With the advent of remote working during the height of the Covid pandemic, many Spanish families opted to move to the Spanish countryside to enjoy more space, peace and quiet to lower the risk of infections. 

This has breathed new life into ageing and underpopulated communities referred to as ‘empty Spain’.

However, according to Ferran Font, head of research at Spanish property website pisos.com, the trend is gradually disappearing as Spaniards are again looking mainly for housing in large cities such as Madrid, Barcelona, Valencia, Seville, Zaragoza or Malaga.

“Cities, which have always been magnets for the housing sector – due to the leisure, job and training opportunities on offer – are back to being what people are looking for,” Font told online daily 20minutos.es.

“Empty Spain is becoming empty again”.

This increase in demand together with the rise in Spain’s consumer price index (IPC) means renting or buying in the big cities is again getting more expensive, after a year of sizable drops, particularly for the rental market, when tenants had the upper hand in terms of negotiating. 

READ ALSO: Why you should negotiate lower rent in Spain in 2021 (and how to do it)

What will buying a home in Spain in 2022 be like?

As we reported in our last property roundup, September saw the biggest monthly property boom in Spain since the economic crisis of 2008, and the latest official stats show that the upward trend continued in October for the eighth consecutive month. 

This increase in demand and the comparatively small pool of pandemic-proof residential properties available in Spain has seen prices grow by 9.5 percent over the course of 2021. 

Most Spanish real estate experts agree that these factors, coupled with other factors, will mean this scenario will be largely replicated in 2022.

“According to all the indicators, the gross disposable income of Spanish households is growing, and it seems that this upward path will continue in 2022, as well as the low cost of financing and an attractive profitability of rental housing,” head of Alfa Inmobiliaria Jesús Duque told Spanish property search giants Idealista.

Duque does not believe that 2022 will be a year of large price increases, at least in second-hand housing.

“Another very different thing altogether are new-build homes, which are subject to fluctuations such as increases in materials, or the difficulties in finding adequate labour,” he added.

According to Ferran Font of pisos.com, “empty flats in Spain are not where there is more active demand”.

“The imbalance between supply and demand caused by the lack of stock of new builds and the shortage of new projects will set the sales rhythm in 2022,” Raúl Guerrero, CEO of Spanish developer Gestilar, told Business Insider.

Understandably, there isn’t exact consensus among property experts about how much more expensive Spanish homes will get next year. According to Gonzalo Bernardos, Associate Professor and director of the Real Estate Master at the University of Barcelona, average “prices will rise by 10 percent in 2022”. 

How to sell Spanish property in days

According to Idealista, it takes on average 10 and a half months to sell a property in Spain. But are there ways of cutting that time short?

Logically dropping the price plays a major role, with Spanish property experts saying a drop of 20 to 30 percent can shorten the average ten months by half. 

But according to Spanish website helpmycash.com, one of the best options to really speed up the process is using an iBuyer – or Instant Buyer – a company that specialises in buying homes cash from those who need to sell their home urgently, putting in an offer within 24 hours.

Instant buyers have just started to make an appearance in Spain over the past couple of years, with Italian firm Casavo and Tiko the biggest players currently. 

The advantages are the quick sale, big saves in administrative costs and immediate full cash payment.

But the downsides include that Instant Buyers buy below market price (generally 8 to 10 percent below), they only currently operate in some big cities in Spain, there isn’t enough competition for sellers to choose from and their price offers are usually non-negotiable.

Alternatively, estate agencies continue to be a way of completing the sale process faster, who in most cases find a buyer in 30 to 60 days, but do charge anywhere between 3 and 7 percent of the price of the property in commissions.

READ ALSO: The best tips for buying a property in Spain without an estate agent (and avoiding scams)

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PROPERTY

How Spain is betting on cohousing for its elderly and low earners

The Spanish government wants to invest in cohousing buildings where people of all ages live under the same roof and share common spaces, a dignified way for the eldery to avoid loneliness and a cost-effective form of social housing for those struggling to pay their rent.

cohousing spain
It’s important to distinguish between coliving, which involves sharing bathrooms and the kitchen, and cohousing, where only common living spaces are shared. Photo: LOIC VENANCE/AFP

Spain is renowned for being a very social country where people, young and old, get together outdoors to enjoy each other’s company and pass the time.

But this shared living concept has never been as prevalent when it comes to housing arrangements, with 65 percent of Spaniards in individual flats and 4.8 million people (a tenth of the population) living by themselves.

Enter cohousing, which can be called vivienda colaborativa in Spanish even though the English terminology is preferred, an arrangement that sees residents in a building have their own private accommodation but share common spaces such as the kitchen, laundry or other living areas. 

The Spanish government’s 2022-2025 State Housing Plan includes a proposal to boost this cohousing model through financial aid and a 20-year lease for the tenants, considering that this cooperative living arrangement “enables greater integration and a closer relationship between tenants”. 

What it could mean in practice is people of all ages living under the same roof in a building which resembles university dorms.

They cook together, watch a film together, play board games together, but then have their own rooms or small apartments to retreat to. 

According to Spain’s Ministry of Urban Agenda, existing cohousing spaces in Spain and other EU countries are already proving to be a success, and the model could help to partly solve the country’s housing problems, where rising rents and property prices are making it harder than ever for people to find a home. 

Collaborative living in Spain so far has mainly been created for the elderly as a way of preventing loneliness (2.1 million over-65s in Spain live alone), to create a sense of community and to share energy bills and other expenses such as doctors’ visits. 

What hasn’t been tested yet is how the cohousing model would work if tenants of different ages and backgrounds were all housed in the same cohousing unit, with some experts considering it could lead to confrontations due to generational differences.

Reader question: Can I move into a Spanish care home as a foreigner?

It therefore seems more likely that the cohousing model for the elderly will be promoted mainly as an alternative to care homes, one which offers them more dignity and independence if they are able bodied and the possibility of growing old together. 

Cohousing could also serve to house temporary agricultural workers in Spain, most of them foreign and poorly paid, and who often struggle to find or can’t afford to rent decent housing during their time in the country.

It’s important to distinguish between coliving, which involves sharing bathrooms and the kitchen, and cohousing, where only common living spaces are shared.     

Spain’s government is currently seeking to pass legislation which would bring a series of major changes to the country’s housing laws, from price freezes to €250 rental allowances for young low earners (already approved), big tax hikes on empty homes, rent caps and last but not least, more social housing.

Under the proposals, thirty percent of new builds will have to be social housing projects meant for rental, Spain’s new housing law states, a decision which still has to be approved by the Spanish Parliament. 

Spain has the lowest amount of social housing in the EU with 290,000 units, only 1.1 percent of all properties in the country. 

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