A few years ago, we spoke of the recovery in the Marbella property market, then of the confirmation of having entered a new growth cycle, and since then we have come to qualify the present period as one of sustainable growth in which the economic forces represented by buyer and seller are reasonably well matched. Unlike a recession, where the (cash) buyer is king, and a boom, where the (credit) seller is king, this is a healthier, more balanced situation, and therefore also more sustainable for Marbella.
After a brief hiccup in the latter part of 2016, following the Brexit surprise, the property market on the Costa del Sol recovered strongly in 2017, with high and well-diversified demand driven by the Nordic countries, the Benelux, France and parts of the Middle East – with rising domestic demand and the British market bouncing back, particularly in Marbella upper end of the market.
As we near the end of 2018, it is clear that this year has seen the consolidation of the 2017 trend, namely good, solid demand for the properties and unique quality of life that Marbella and its surroundings have to offer. A measurable sign of this is the recorded number of property transactions within the region, and in particular leading municipalities such as Marbella, Benahavis, Estepona (known together as the Golden Triangle), plus Mijas.
They tell the story, which is also confirmed by such indicators as the number of jobs created in the property sector, the mortgages approved and the movement of property values, which has been steadily upwards for some time now. Apart from some locational hotspots, home prices are rising in a sustainable manner and still offer good value – especially when compared with comparable levels in the Northern European countries from which most homebuyers in Marbella hail.
Looking to 2019
The picture for 2019 is therefore one of consolidated growth at a healthy, maintainable level that confirms there is no fear of a property bubble in sight. Looking at trends, the main driver of demand in recent years has been modern, newly-built homes in up-and-coming locations such as Mijas Costa, Estepona’s New Golden Mile, its western littoral and inland parts of Benahavis, whose country club setting remains popular. Sotogrande has also seen a revival, with renewed construction activity providing buyers with a good selection of new developments to choose from, but just recently existing resales properties have made a bit of a comeback.
The fact that some buyers may be tiring of the sleek, white modern architectural styling is also reflected in new designs that incorporate more diverse materials, tones, textures and also styles, and this increased diversity is a positive thing for buyers, who have more variety to choose from. The expectation is that 2019 will provide another consolidation of sales levels, that the rate of growth may begin to mature and level off a bit, along with the number of new project starts, and that resales will continue to gain some ground, along with the renewed importance of the domestic market, but overall another good, solid year is expected on the Costa del Sol.
This is borne out by a recent report by the respected Spanish valuation firm TINSA, which not only confirms that foreign investment in Spanish real estate has continued to grow, but also that property prices are likely to continue their steady upward drive by 5-7% nationally, with growth levels above 10% on the Costa del Sol. Rental price increases may also slow down a little, but as they have been rocketing in recent years both the short-term holiday and long-term rentals markets in Marbella are very attractive to buyers and investors alike. The growth cycle is maturing and upward movement is at a sustainable rate that gives buyers the confidence to continue seeking homes in what remains one of Europe’s finest living environments. Contact Winkworth if you would like more information about the properties for sale on the Costa del Sol.