The Coronavirus lockdown caused an enforced hiatus of activity in Marbella real estate, and since its ending, we noticed an upsurge in consumer interest, but what does the Spanish real estate sector need to do to ensure the industry’s outlook remains strong for the foreseeable future?
Last year it seemed we had come to the end of a post-financial crisis period of recovery and growth that began around 2013 on the Costa del Sol and some years later in the rest of Spain. After some very good years, the first half of 2019 appeared to slump and herald in a downturn in the Marbella property market, before a revival after the summer, which continued into 2020. Such was its momentum, that the new year began stronger than many would have expected, and fears of a recession seemed ungrounded.
Then came the most unexpected factor of all: the Coronavirus. Before we knew what hit us in Marbella, we were in lockdown, and much of the global economy with it. Many in the industry showed their resilience and used modern technology to provide virtual property viewings, a development that will certainly continue even after the lockdown, but since things began opening up again in Spain in May/June, the industry has reported strong demand, with many enquiries and viewings taking place in Marbella, which is a positive sign.
Much of this revival will be due to demand built up during the lockdown period, but it also reflects a healthy interest in the properties, lifestyle and investment opportunities of regions such as the Costa del Sol. Prices are not suffering much yet, and demand is solid across the coast and its different segments, though the most vulnerable for future fluctuations is the low-range between €100.000 and € 400.000. Top-end properties in the most sought-after areas such as Marbella’s Golden Mile remain evergreen, and the return of previously unreleased bank repossession stock is reviving interest in the lower price range.
To keep this momentum going, the industry will require some favourable factors, such as a slow-down in the price increases of the previous few years, bank lending for developers and private buyers alike, low interest rates and a growing diversity of property types. Within this, there has been a trend back to contemporary Mediterranean architecture, natural interiors and resales, as well as a partial movement back to core areas such as Marbella, but also growing interest for properties with gardens and those in more natural zones, such as El Madroñal, La Zagaleta and La Quinta.
Indeed, country chic on the edge of Marbella is enjoying a revival and offers an excellent choice of beautiful homes with a rustic Andalusian feel yet a short distance away from Marbella and its beaches and amenities.
It seems the Covid-experience has had an impact on the nature of demand in Marbella, and in many cases strengthened it, but while there is no sign right now of a slowdown or recession in the market, the property sector will need to ensure the right conditions continue to prevail, including moderate price growth, low interest rates and available credit, not to mention excellent properties.