2023-12-25 08:03:27
The purchase and sale of homes moderate fell 11.1% in October compared to the same period in 2022, to 45,903 operations and has accumulated nine months of decline. In this regard, the General Council of the Official Associations of Real Estate Agents (COAPI) of Spain considers that “these figures continue to show that we are in a downward cycle due to the rising cost of life in general and mortgages in particular.”
However, the organization believes that the current scenario “is more than logical” because buyers consider that “interest rates are at their highest point in the last 15 years and that they are going to return to go down in the short and medium termso you decide to delay purchasing a home if you need mortgage financing.
For its part, José María Basáñez, president of the Tecnitasa Group, also foresees “a slight decrease and stabilization of interest rates for the beginning of 2024, continuing the evolution of the last quarter of 2023.” If so, “we can expect that in 2024 part of the purchase demand “which had been withdrawn during 2023 as a result of the increase in credit prices.”
From the General Council of the COAPI they explain that “citizens have taken fear of the euribor. Therefore, he prefers to hire fixed rate mortgages (56.7% in October) than at a variable rate (43.3%), even if it is paying more.
In fact, the average interest rate in October was 3.57% for fixed-rate mortgages, while that for variable mortgages stood at 3.02%. Of the 12,212 total cases in which changes have been made to the conditions of a mortgage, 44.4% are due to changes in the interest rate. After this modification, the percentage of fixed-interest mortgages increased in October from 11.6% to 29.4%, while that of variable-interest mortgages decreased from 87.4% to 69.9%.
Furthermore, the General Council of the COAPI assures that it was to be expected that the average mortgage amount continued to fall – it did so by 5.3% year-on-year in October, reaching 140,564 euros – because now the volume of business is lower, both due to the fall in sales this year and due to the purchase of cheaper properties, since The operations have a lower amount due to the lower economic capacity of the demand.
«To this we must add the fact that now families try to avoid financing lowering their expectations and buying cheaper homes,” they say from the General Council.
Housing prices
The president of Tecnitasa points out that the increase in sales and, therefore, in demand, could cause «price increases», but with heterogeneous behavior in line with the market itself: new housing and areas where demand is more robust will have a greater impact.
Basáñez affirms that the behavior of interest rates will mark the evolution of prices in 2024. «If rates stabilize, we will be able to witness new smoderate climbs of prices in 2024, up to an average of 4%,” he says. On the contrary, if the rise in interest rates is not stopped, there will be a scenario similar to that which occurred in 2023 with less aggressive demand, which could lead to a slight decrease in prices in general terms that would occur unevenly, since the purchase price will continue to resist in new housing and in areas where demand is more solid.
On the other hand, according to an analysis carried out by Solvia, the number of sales could drop between 5% and 8% next year. While prices will continue to increase along the same lines as in 2023, between 1.5% and 2.5%.
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