Market Report

Bernd Hoffmann - Geschäftsführer HI

A personal assessment by Bernd Hoffmann

The Spanish property market is now on everyone’s lips – Europe is the talk of huge losses in value. Unfortunately, time and time again, we see very generic reports from the press thus causing potential real estate buyers confusion or even discouragement.

On the one hand, it is understandable that a journalist must be compressed when writing, however, the facts and figures should also be clear for the reader to understand.

All real estate buyers, whether investors or private final purchasers, should be aware that the Spanish property market is not in principle different than the market in their home country. Be very careful not to compare apples to oranges, because the value of a house in Brixton is not the same as the value of a house in Kensington. Different districts within the same city always differ in real estate prices.

There is no doubt that the real estate prices in Spain have fallen if the market is viewed as a whole. Upon closer examination of the figures it cannot be confirmed that the decline is actually 30% - 50%. Holiday homes in choice locations have certainly fallen in price but only in the region of 10% - 25%. In some of the prime locations, no changes have been noticed at all.

Why the discrepancy?

Statistics such as the monthly TINSA (download at the TINSA point) or Photograph Casa are the classic sources for journalists.

These statistics have one thing is common: they are built on the condo market in the economic centres and urban structures (as you can read the respective indices and how to evaluate them, refer to the points Photo Casa and TINSA).

The analysed data is based on an entirely different class of real estate, therefore the buyer of house cannot really use this as a decision aid. You wonder how to obtain this necessary information to support your investment decision….I can assure you that without outside help, it is almost impossible.

In a market with so little transparency as is the holiday property market it is almost impossible for potential buyers to find the right property without the support of a consultant. Our job is not just to sell the property but to advise and to follow the process through to the end.

A crash can bring a loss to one person, however profit to another. As a buyer you should always ask yourself what is better: to buy in an overheated market or in a market that is in consolidation.

Our review 2010 – Outlook 2011 

2010 in the switching area was a surprisingly good year for HOFFMANN INTERNATIONAL with revenues which again can be compared with the years 2007 and 2008. The construction and property development sector however, almost came to a halt. This picture will change slightly in 2011.

The buyers’ market is currently dominated by German, Belgian, Dutch and Russian customers. Britons are at the top of the sellers.

In the first months of the New Year we could see a further increase in demand from Germany. The British are still very subdued and are more likely to continue on the selling side.

HOFFMANN INTERNATIONAL has 24 years experience to serve you. During this time we have always met with passion for our profession and love for the Costa Blanca. Continuing this spirit we would like to work for you. 

We look forward to welcoming you on the Costa Blanca.

Bernd Hoffmann & Team