Spanish Properties Breathe Again A Good Time To Invest

Noted billionaires John Paulson and George Soros, are well-known for their ability to make bold calls. Despite showing different styles in their ventures in the past, the two have shown a common interest in the Spanish real estate market this year. The two recently invested $127 million each, in Hispania .

With Soros being one of the most celebrated hedge-fund managers in history, and Paulson being right in his predictions of the 2007-2008 US mortgage market bust, is it time for other investors to follow their lead, probably on a smaller scale? The proposition certainly looks inviting to investors, considering that current Spanish property prices are at their lowest.
An inrush of foreign investors

The prices of prime properties in the Spanish real estate market, are less than the peak values they reached, about five years back, by nearly 30 percent. The difference in property prices of those along the Costas is almost 70 percent, although, properties have been experiencing a renewal in the recent past.

Savills claims that the inflow into the retail property sphere in Spain, last year, increased almost three-fold. The inflow in 2012, was €320 million, when compared to last year's inflow of €850 million. The majority of the inflow can be accredited to foreign investment.
Predictions for 2014

Gema de la Puente, the research head at Savills, says that bullish multinationals have a built-up demand, and that they are trying to make their way into the improving mid-term economy in Spain. Many of these multinationals have been biding their time, waiting for suitable opportunities to spring up.

Recently, Vodafone bought Ono, one of Spain's biggest cable TV and broadband unit, for €7.2 billion. The economy has been looking promising too, as the credit rating was upgraded by Moody's last month. Among other stories of Spain's recovery, the yield from 10 year government bonds have hit their lowest values, since early 2006.

Whether or not the recent improvements will reflect on the property market, is the big question on everyone's lips. Fitch reports that mainland Spain will see slow progress for the most part, as it is yet to recover from the crisis, and its repercussions. The agency predicts that property prices in Spain, will continue dipping further this year, and will hit their lowest in 2015. While the Costa de Sol expects a gloomy phase, the classier markets to the north of Mallorca, near Deja, are looking promising.

According to reports from Knight Frank, property sales in the area went up 40 percent during 2013. The sales were largely propelled by investors from Northern Europe, who were looking for properties at bargain prices. The upmarket districts in Barcelona and Madrid, currently look promising for city dwellers.

The government has been working towards attracting in buyers too, hosting multiple property roadshows and highlighting bargain prices of Spanish properties. Aside from following in Soros' footsteps, the Spanish real-estate market now seems inviting to investors of all levels.

Source: property-abroad.com