17 Oct Buyers and Renters to Benefit from the Independence Referendum? Catalonia 2017
The real estate market in Barcelona is “paralyzed”
Are buyers and renters in Barcelona benefiting from the Catalonian Referendum? Recent political events in Barcelona, including the Catalonia Independence Referendum, and Puidgemont’s inconclusive speech on Tuesday 10th October, have thrown the city and the wider region into a period of uncertainty. With the city and the rest of the world waiting in suspense for the decision to either become an independent state or remain part of Spain, this is an exciting and historic time for all involved.
With regards to how this period has affected Barcelona real estate, Tine Mathiassen from Casamona International has commented that the market has been “paralyzed”, with buyers from across the world waiting to see how events will unfold. This is most notably the case amongst Golden Visa buyers (coming from outside Europe, and able to attain a European visa if they purchase a property for more than 500.000 euros in Spain), who are afraid of the consequences of Catalonian independence and their departure from the EU.
Whilst the future of Catalonia hangs in the balance, one thing remains certain: property in Barcelona and the surrounding area continues to make for a lucrative and reliable investment.
In a report released by PwC in March of this year, Barcelona was ranked 15th in a list of European property markets with the greatest predicted prospects for investment. Likewise, in a more recent investigation conducted by El Mundo which analysed the rental and sales rates across the country throughout the most recent quarter. Madrid and Barcelona were seen to maintain their status as stable investment prospects, with gross profitability rates ranging from 3.72% in Pedralbes to 9.44% in La Clota, in Catalonia’s capital (1).
Such invariability has been attributed to a continually increasing demand for rentals in the two major cities, with El Mundo even going so far as to say that in Madrid the number of available apartments is struggling to match the quantity of new renters.
The rental prices have gone down by 10-20% this summer for Casamona’s high quality rental apartments
Over recent years, such increase in demand has resulted in a parallel increase in rental prices, with rates in Catalonia’s capital rising by a total of 16% in 2016 (2).
Sales prices also appear to have been affected, increasing by 21% (Stücklin, Mark, SPI News Bulletin 14th October 2017) in the past twelve months alone. And yet, here at Casamona we have begun to notice some respite from such augmentation in price. Over the summer, rental prices appear to have decreased by approximately 20% across the company’s standard apartments, with Mathiessan largely attributing this to the of enforcement of laws banning short term apartment rental through companies such as AirBnB.
The Independence Referendum may also have contributed; as Mark Stücklin, writing for Spanish Property Insight, commented, political instability often makes for an ideal time to invest in real estate, with falling prices allowing for buyers to save money on property in popular locations.
What is the future for Catalonia’s Real Estate market? Will we see an adjustment?
The future of Catalonia is of course impossible to predict, and only time will tell whether the coming months will have a lasting impact on Barcelona’s real estate market.
And yet, with prices in both the rental and sales sectors of the real estate market falling to more rational levels, why not seize this opportunity to invest in the city? With so much to offer in terms of history, culture, fashion, food and sunshine, the capital has for many years been one of the best-loved destinations worldwide, and the events of October 2017 could provide renters and buyers alike with the perfect moment to profit from its vibrancy and continued popularity.
To know more about the referendum and Casamona’s opinion check this blog post