Today we are going to talk about what has been happening, what has changed and the surprises that have happened in the first half of 2021 in Valencia Property. Evidently there have been more sales in the first half of the year than there were last year, after all we spent three months of the first half of 2020 in lockdown.
We have done this without people being able to travel freely in and out of the country either which is a bit of an achievement as we are an agency dealing almost exclusively with foreign clients. With Covid case numbers and vaccinated people rising massively at the moment there seems to be a race on to get people vaccinated so that Spain can open up to the World more.
Before you read on though just one question to think about, what are you expecting me to say? People have preconceptions about the property markets they are interested in and sometimes those impressions are totally wrong (Sometimes they are spot on). What do you think is happening on the ground in Valencia. Have a think before you read on. (And play the little video graphic below ;-))
Average Sale Price
The average sale price for our clients has gone up by around 30% compared with 2020. However this does not mean that prices have risen by that amount, see below for that information. We have pivoted to dealing with more higher end clients who are finding that the Valencia Property market gives them what they are looking for at a price they are more than willing to pay. When you ally this to the effects of Brexit, see below, then you have a couple of good reasons why that average sale price has gone up.
There are competing narratives as usual in Spain about what is happening with prices: the notaries, property registry, portals and agents all post differing stories on what’s happening with prices. Only today I read that the biggest increase in price in the last year was for one bedroom apartments with an average price rise of 21% (An unbelievable 41% in Valencia supposedly) yet last week I was reading that prices have dropped by around 1% in the last year.
What’s the truth?
Well, as usual it’s somewhere in the middle. We estimate that prices in Valencia have risen on average by around 10% in the last year with certain areas and towns surrounding the city rising more and others less of course. Where do we get this information from? We take an average from all official sources, look at asking prices and reductions of prices on sale, don’t expect much of a reduction in the city or the most popular suburbs, and then lick a finger, stick it in the air and make our estimate. In other words it’s about as scientific as all of the other “official” figures in Spain. However, we are on the ground here and see when things disappear off the market, ask agents what things sold for when they disappear and use all of this information to make our judgements.
The typical client of Valencia Property still tends to be a first language English speaker who doesn’t require a mortgage and is ready to buy now having sold up in their home country. We get clients from all over the World of course but our main markets can be seen below.
The Process of Buying
You can read all about the process of buying a property in Valencia here. Things are changing slowly and more of the process can be done remotely. We are finding that video calls live from a property, video walkthroughs, 360 tours and drone photography are helping people to make the decision to purchase remotely but the majority of sales are the more traditional visit a place, like it, make a second visit and make an offer.
Being able to buy remotely has been made easier with onboarding by banks for opening accounts, notaries effectively allowing transfers into client accounts for payments and more people willing to give Power of Attorney to their nominated lawyer in case they are restricted from visiting due to the Covid situations in various countries. We actually made our largest sale ever in the city this year without the client ever having visited the property.
Supply is tight. Really, really tight. The good stuff gets sold quickly and at or very near to asking price. Demand is high and therefore there is an ever increasing tightening of the market especially now we are in summer when traditionally a lot of property gets taken off the market because it is rented out for the summer or being used by the owner. Don’t expect to see ten to twenty properties on sale at any one time that match your requirements unless those requirements are really broad, and they shouldn’t be. The broader your requirements the less chance you have of finding a property that suits because effectively you don’t know what you want. You should have plenty of positive constraints on what you are looking for. Let us know in our article here about taking the first step, what you requirements are by filling in the form at the end and sending it to us.
Type of Property
We divide our properties into three main types; apartments, villas and townhouses. So far this year the sales have been around 60% apartments in the city, 25% villas and 15% townhouses both in the city (Cabanyal) and the surrounding towns. Last year it was 82% apartments and 18% villas. The movement out of apartments into townhouses and villas is clear but apartments continue to be the most popular type of property for our clients.
Simply put, there aren’t any. Supply of rental properties is just not there in many areas. This is allowing landlords of the worst places to get tenants unfortunately. We don’t advertise rentals in general because as soon as they are available they are gone. However, we do get lots of requests for rentals and we have to say sorry but there is nothing available. Especially in the satellite towns and the most popular areas of the city you cannot find anything. For investors this is good news as the satellite towns often have excellent prices and they can get a good return but the penny doesn’t seem to have dropped for international investors yet as they continue to concentrate on properties in the most popular areas of the city where returns are lower.
The numbers of British buyers is down from previous years but the average purchase price of those British buyers has risen considerably. There are a number of reasons for this.
Firstly, we are dealing with more middle and high end clients from the UK. The lower price range clients tended to be people looking to retire to Spain after years of saving for that possibility and Brexit has taken away their ability to easily live in Spain or Europe as a whole. With low UK pensions and higher private healthcare costs for older people their dream has been stolen from them by the lovely people who voted for Brexit. Remember this and never forgive them!
Secondly, the Golden Visa offers 365 days a year in the Schengen area for those who want it so clients who previously may have paid 400k for a place are now looking to spend 500k and get that Golden Visa.
Thirdly, the UK property market has gone mad due to people wanting to get a property before the end of the Stamp Duty holiday and because of people moving out of cities due to the pandemic and this has meant that those coming over have more money available than they thought they would have.
The four years of the Orange Sh*tgibbon have been hard on Americans and many who decided they were leaving if “the Dimwitted Führer” got back in have decided they have had enough anyway. What pushed many of them over the edge was the Insurrection of the 6th January.
People who already felt unsafe due to gun culture, mass shootings and MAGA nutcases everywhere decided that this was the last straw. The Big Lie of the States that America is the best place to live has been seen for what it is, a huge fat dose of fake news. On a worldwide scale it ranks 27th in education and healthcare, 19th in Happiness, 26th out of 35 in the OECD ranking for Life Expectancy, 20th for quality of life, it’s even 15th in Freedom when it is supposed to be the Land of the Free of course. It does well in Poverty being the number 4, number 1 in the OECD in Obesity and eighth in the word for homicides through firearms, so there’s that.
Americans are generally searching for a more peaceful life where they don’t have to have their senses on high alert at all times in case of active shooters. They also like Valencia because for a lot of them the climate is a less humid version of Florida or a wetter (not drought ridden) version of California without ridiculous house prices. Life is cheap but not in the getting killed by a nutter way, the lifestyle is laid back and there is plenty to do. Access to this part of Spain allied to the ease of travel to the rest of Europe is a huge plus of Valencia for Americans.
And guess what, we love our American clients. They are the sane ones with their eyes wide open (Not the MAGA crowd), they recognise the advantages of using a buyer’s agent, they don’t have unrealistic expectations in general and they have a genuine interest in everything we tell them about the city and the area as a whole.
The Dutch are back. After a year without travelling the Dutch are back. There is a big reason for this which I just found out today from a friend and client. Taxes have increased on gains on all investments except one thing, can you guess what that one thing is? Yes, it’s property of course. Wealth taxes exclude property so the Dutch are looking to expand their property portfolios of course if they are looking to invest.
It’s a long way from Australia to Europe but many of our Australian clients don’t come here straight from a Land Down Under. They are usually already established in Europe and are looking to move to somewhere that offers them warmth and the beach and sea with the huge added advantage of not being eaten by a Great White Shark or Salty or stung by a Box Jellyfish. Australia is a long way away so they look at Southern Europe and find that Spain is a place that suits them and it also comes without the inconvenience of eight of the World’s top ten poisonous snakes, a multitude of spiders that can kill you and worst of all, Vegemite.
We have started working with more affiliates this year who send us clients from around the World who are looking to move to Valencia. We work with agents, bloggers, influencers, YouTubers and more. Our ex-clients who have bought off us also recommend us to their friends and family too. If you are looking to get an extra income then why not look into becoming an affiliate. It maybe that you just have a friend or family member looking and want to make sure they get the best service, put them in touch with us.
That’s The Report
Sales up, prices up, average sale price up, demand up, supply down. Simple!
If you want to join us just contact us and see what we can do for you. Maybe start by either sending us a mail or filling in the form at the end of this article. We will look after you well. And meanwhile take a look at the latest…
Golden Visa Property Of The Week
Valencia is a beautiful place to live in, great weather, beaches, mountains, perfect for the outdoor life. But, it can make you soft. For example, sea-swimming doesn’t really happen until the water gets to 25 degrees. Outdoor pools don’t open until the end of June.
This is important to know before we see this house. A large villa in La Eliana, really nice inside, a mixture of modern design with classic touches. 6 bedrooms and lots of living space over 2 floors.
It includes a big plot, already developed into gardens, outdoor living and office space, terraces and a swimming pool. And this is the bit I’ve been coming to, the pool has a moveable roof! So swimming all year round. You’re looking at this from Northern Europe and you’re thinking its Spain, its the Mediterranean, what do you need a covered pool for?
Because you live here for a while, life is good and the living is easy, and you get soft. Trust me on this. And imagine living in this large modern super-comfortable home, before you know it you’ll be wearing your winter jumpers well into May, swimming indoors in June and refusing to go to the beach until July, just like the rest of us.
More Essential Reading
Just click on the images below to be taken to some of our other articles and listings. You know it makes sense.