Is Spain Poised to be an International Real Estate Hotspot Again?

Santiago Herreros de Tejada
Santiago Herreros de Tejada

by Santiago Herreros de Tejada, Corporate Director of Grupo Sociedad de Tasación (ST)

In the period 1999-2007 Spain experienced a real estate boom, coupled with strong international investment and a high rate of new construction, with more than 450,000 built properties in 2003 alone! Like in the United States, banks gave 100% loans and prices increased dramatically. When the crash came in 2007, Spain had an estimated stock of more than 1 million empty homes, many of them targeted primarily to foreign buyers. Between 2007 and 2013 Spain had a difficult time with price adjustments (50%), financial reforms, increasing unemployment (up to 25%), and big changes in the Spanish real estate industry with banks becoming the largest real estate agencies in the market.

Similar to the US, the market is in recovery mode.  Housing prices in Spain have rebounded 4.1% from a year ago and this is the first time since June 2007 that annual house price variation is positive. Reports such as ST Sociedad de Tasación and INE (Spanish Institute of Statistics) are contributing to improved expectations about recovery in the market. Foreigners now make up just under a fifth of the total demand for Spanish property with approximately 19% of all purchases in 2014 being made by international buyers. The period from January to March saw 15,402 purchases by foreigners, which represents a 27.2% year on year increase.  The UK is still # 1 in the ranking of the nationalities of Spain’s foreign buyers, and make up 13.8% of the total, followed by France (10.5%), Russians (8.4), Germans (7.5%) and the Belgians (6.9%).

US buyers lead the pack with increases on year-on-year purchases at 88.9%, followed by China (83.1%), Ireland (78%), France (69.8%) and Russia with a 62.6% rise.

How can agents tap into these opportunities?
As a result of the crisis, the number of real estate professionals has declined significantly. By 2009, 70,000 real estate agencies closed and more than 300,000 professionals lost their jobs. Now, most of the banks have their own real estate agencies and target properties to foreign real estate buyers through their websites. (Examples include and

Consumer-oriented trade shows are also popular including SIMA and Barcelona Meeting Point, which offer opportunities for real estate professionals to explore the opportunities that the country offers and to sign representation agreements to market projects.

Spain has always been one of the premier destinations for Europeans when buying real estate and this can be seen at Rightmove Overseas Search Report where Spain leads the position of searches of international property.

Also International Funds are taking advantage of the low historic levels and are acquiring property portfolios in the Spanish market directly and through SOCIMI´s (the Spanish REITS) which are special vehicles created to attract international investment with great advantages for non-residents.

Sales increased 8.8% in June 2014, compared with June 2013. With foreign investment up by 16% compared with the previous year, and lending up by 19% in 2014, it is clear that Spain’s real estate market is one of the most promising for investors. Additionally, Spain ranks third worldwide in tourist arrivals, has an excellent infrastructure, a high standard of living, a skilled labor force, a valued health system, and excellent gastronomy and entertainment options. Recreation opportunities abound with 450 golf courses and nearly 5,000 kilometers of coastline.

If you are working with a client that is interesting in investing in Spanish property, it is smart to conduct valuations, real estate due diligence or surveys, and explore mortgage opportunities prior to investing. Whether purchasing one property or multiple properties, resources such as or can help make appropriate and informed decisions.

The improving economic picture, along with Spain’s continuing popularity as a tourist destination, are leading many second homebuyers and investors to enter the Spanish Property Market. When your clients are interested in purchasing overseas, consider Spain as a profitable and beautiful destination! View properties at

Santiago Herreros de Tejada is Corporate Director of Grupo Sociedad de Tasación (ST), a group of companies involved in the Spain’s real estate and appraisal sector since 1982, and one of the largest independent Real Estate Valuation firms in Spain. Previous to his current post, he worked as International Director of SIMA EXPO (Madrid International Real Estate Exhibition), and was a Business Development Director for Overseas Property Professional (OPP,) a  global real estate information and media group.