The CEO of the promoter of Aedas Homes has made an assessment of the situation of his company and the real estate sector. David Martínez has shown himself to be optimistic with regard to the future, although he has warned that the rise in interest rates will produce a decrease of nearly 15% in the sale of new-build homes. Despite the uncertainty generated by the new Housing Law, the manager assured that foreign investors have great confidence in our country. “Foreign capital believes a lot in Spain, sometimes more than we do,” he stated at an event organized with the economic press.
“What the foreign investor thinks is that they will find legal security here (with the exception of the latest movements of the Central Government). It also has physical security, which is something that we do not value very much, but for foreign capital it is It is very important that in Spain anyone can move down the street at any time of the day, something that does not happen in other first world countries and where they also invest. In addition, the imbalance between supply and demand makes Spain a great place to invest”, he stated.
Precisely, with this gap between supply and demand, Martínez is optimistic about the future of the new-build housing development sector. “The rise in rates will have an impact and we will see a slowdown in sales and even decreases of up to 15%. But this situation is not worrisome because there is still more demand than supply. In Spain, 85,000 homes are built a year, when we should be close to 150,000 units a year,” he said.
Regarding the macro situation of the European Union, the CEO of Aedas Homes is in line with what other experts in the sector have pointed out in Sima: a quiet 2023 in terms of real estate investment. “Everything points, if geopolitics allow it, for the ECB to slow down this increase in rates. This will allow economic activity to increase and therefore there will be a recovery in sales for 2024,” he stated in this regard. “We have been a fiscal month into our next financial year, but we already have 75% of the product sold and 30% of the next one”, he highlighted in relation to the current situation of the promoter.
Martínez has also once again pointed out one of the endemic problems in the sector: the lack of land. “In Spain there are three types of land: protected, urban and developable. In the first one you cannot build a house, the second is the best because it is a finalist and you can already build and the third is where we find the biggest barriers because we need to convert the developable into urban in order to work. Carrying out these procedures requires administrative approvals that are usually slow and cumbersome. Also, if you make a mistake in the processing of this conversion, you may return to the starting box and have to start from scratch . I am confident that the new regional and municipal governments will give the necessary importance to speeding up this process”, he defended.
In a political key, the visible head of the company has celebrated that housing has entered the electoral debate. “We missed that he was not at the politicians’ table. In Spain, less housing is made than the country needs. A stagnant demand is being created. It is a state problem and a country problem,” he asserted.
To tackle this problem, the manager is very clear that they need money from outside. “The capital of the promoters is different from the previous cycle. Now, most of that money comes from abroad, from pension plans, for example, that handle many millions of euros and that commission managers (investment funds) to move that money to find a return. These funds can invest in real estate, in the financial sector, in other products… but they can also invest in Asia, in Europe… and within Europe in France, in Italy, in Portugal, in Spain… Therefore, the success of our industry is based on attracting this capital, otherwise we would not be able to invest. The reality is that each Spaniard owes 35,000 euros and we need foreign investment to build new homes. If the investment fund, for political or technical reasons, believes that it is difficult to invest, it will not do so or it will ask for a higher return” he has ruled.
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