The real estate market, after the global uncertainty caused by the crisis, seems to be recovering at a fast pace and once again gaining importance The real estate market, after the global uncertainty caused by the crisis, seems to be recovering at a fast pace and once again gaining importance in The real estate market, after the global uncertainty caused by the crisis, seems to be recovering at a fast pace and once again gaining importance in the Spanish economy. In fact, as far back as 2017, the data's results could not have been better. But are they as rosy for 2018? The answer, according to Foundation of Savings Banks (Funcas), is yes. in the Spanish economy. In fact, as far back as 2017, the data's results could not have been better. But are they as rosy for 2018? The answer, according to Foundation of Savings Banks (Funcas), is yes.
According to calculations made in a recent study by Funcas, it is estimated that, in 2018, gross fixed capital formation in residential construction will grow to 8.3%, an improvement of 0.4% compared to 2017 and 1.7% more than in 2016. This represents a recovery that will surpass the highest figure recorded so far, which dates back to 2006. In addition, it is expected to play a key role in the country's GDP growth, which will reach 2.7% over the next year.
POn the other hand, part of the economic slowdown that will take place in 2018 (GDP will grow to 3.1% in 2017) will be due to a less dynamic demand for property at the national level. However, the push from those who wish to take up a second residence, especially from abroad, will make up for the fall in figures. This, furthermore, will be encouraged by the low interest rates that exist at the moment and are expected to be maintained in similar figures during the next few years.
Licenses to build new properties are in quotas that have not been seen since 2011. In fact, just in the period between January and May 2017 there were more granted permits than 2013 and 2014. In addition, 11,000 licenses have also been granted this year for property renovations, which represents a growth of 4%. These data are still far from those experienced in the construction boom, but they are starting to get closer.
The truth is that there are many other indicators that predict 2018 will be even better than 2017. For example, taking into account the activity of construction companies engaged in cement usage, which has been growing in recent years at rates higher than 10%, the sector is expected to grow by 6.1% in the next twelve months. This will make 2018 the best year out of the last five years, according to data provided by the employers Oficenem.
These data are also corroborated by the Association of Construction Companies and Concessionaires of Infrastructures (SEOPAN). Three different and independent bodies that have reached similar conclusions after having analysed the dynamics experienced during the last few years.
All of this is supported by the fact that, according to the statements issued by those responsible for the management of the European Central Bank, the cost of borrowing money within the euro zone will remain stable until at least the end of 2018, which translates into interest rates not rising. In fact, according to recent statements, this would only occur if inflation reached its optimal level, which is fixed at 2%.
The fact is that even the most optimistic forecasts do not expect inflation to reach or fall to 2%, so it is to be expected that interest rate increases will not occur until at least the middle of 2019. This, of course, will continue to encourage investors to apply for mortgages and buy homes. In summary, everything seems to indicate that 2018 will be even better than 2017 for the real estate industry, which is no small matter and certainly a very positive outlook indeed.