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The right time to buy in Spain?

The right time to buy in Spain?

Traditionally the property market has gone up and down with a cyclus of about 20 years. Slowly moving up to a peak, only to drop fast as we experienced with the financial crisis in 2008.

If the past can be used as an instrument to predict the future, we are looking at a slow period of price increase over the next 10 years – give or take a few.

This period will be seen as less disastrous as 2008 to 2010, however still with a somewhat nervous economy that should be improving slightly year by year.

Combined with a low interest rate, this is perfect timing for the long term based investor, or buyers who wish to use or rent the property.

Spain is not right for the short term investor, both the property purchase taxes and the expected slow price increase makes it better to wait until we are closer to the next expected peak in prices. Exactly when or if this will be is hard to predict, however there are no indications that it will be in the foreseeable future, indeed many in the property business expect  that it wont happen for at least another 5 years. At the end of the day, it is always a personal point of view.

Supply and demand

2013 has seen an increase in sales as property owners has realised the market value has dropped and adjusted their own price accordingly.

Many properties have lost 30 – 40% of their value from the peak in 2007.

The correct price of a property is determined by what buyers are willing to pay, and in a period of low demand, prices too are low.

Nobody can predict the future, but right now seems to be optimal for buyers with a low interest rate and low prices.