Expansion history: how Airbnb is changing the global real estate market
The idea of ​​Airbnb was born in 2007: then in San Francisco the recent graduates of the Rhode Island Design School, Brian Cesky and Joe Gebbia, had nothing to pay…

Continue reading →

Non-traditional effect: how does the LGBT community affect the value of real estate?
Where to look for real estate, which will definitely rise in price in 10–20 years? There are dozens of theories by which analysts are trying to predict price increases in…

Continue reading →

Education in Greece
The education system in Greece is divided into three levels: primary, secondary and higher. Each of them consists of two sublevels. A child of any nationality living in the territory…

Continue reading →

“Now it’s the other way around”: investors choose Valencia after a referendum in Barcelona

On October 1, 2017, a referendum on independence was held in Catalonia, 90% of those who voted in favor of separating the region from Spain. Since then, uncertainty has reigned in the real estate market of Barcelona.

If those who live in Spain and are looking for residential real estate in Barcelona for themselves, continue to search, then investors have focused their attention on Valencia, says Maria Kamysheva, project manager for Spain in Tranio. This is confirmed by other experts. “Previously, if customers fluctuated between Barcelona and Valencia, then 80% of them eventually chose Barcelona: it has better transport links and it is three times larger in size. Now the opposite is true: 70–80% of customers choose Valencia, ”says Juan Luis Herrero from Lucas Fox in an interview with the Financial Times.

According to the Spanish Board of Registrars of Property (Colegio deMistigradores de la Propiedad), although over the past few years the number of real estate transactions has been growing in both provinces, now in Valencia demand is increasing twice as fast: in the second quarter of 2017, their number increased by 8.25% against 3.15% in Barcelona, ​​in III quarter – by 4.12% in against 1.35% in the capital of Catalonia.

Property in Spain
The share of buyers from abroad in the Barcelona market declined for the first time in five years: from 9.50% in 2016 to 9.24% in Q3 2017. In Valencia, the share of foreigners continues to grow: from 8.59% in 2016 to 10.24 % in 2017.

Property in Spain
Why Valencia?
Lower price
According to statistics from the Rightmove portal, the budget of home buyers in Valencia is 4–5 times less than in Barcelona: 64 thousand euros against 243 thousand for apartments and 119 thousand against 573 thousand euros for houses.

Prices in the city of Valencia are really lower than in the capital of Catalonia. According to the portal Idealista, in the fourth quarter of 2017 a square meter in Valencia cost an average of 1,668 euros, in Barcelona – 4,284 euros.

Property in Barcelona
According to Idealista, housing prices in Valencia peaked in the second quarter of 2007 (2 802 euros / m²), and by the third quarter of 2014 they fell by 50%, reaching a bottom of 1,400 euros / m². By the fourth quarter of 2017, the cost per square meter increased by 19%.

In Barcelona, ​​housing prices peaked in Q1 2007 (4,732 euro / m²), by Q3 2013 they fell by almost 40% to 2,957 euros / m², and by Q4 2017 they rose by 45%, approaching the pre-crisis level.

“In Valencia, not such a rapid jump in prices, as in Barcelona, ​​so the growth potential is greater,” – explains Maria Kamysheva.

Easier and more profitable to rent
Valencia is a more favorable market for landlords than Barcelona. Here you can easily rent up to four objects – just register them in a special registry. In Barcelona, ​​it is not possible to rent a house for short-term rent without a license, the issuance of which has been suspended since 2014.

On the other hand, according to AirDNA, which processes ads on Airbnb, the average rental price in Barcelona is about two times higher than in Valencia. At the same time, in Valencia, you can get a higher yield due to the low cost per square meter, which is 2.5 times cheaper today than in the capital of Catalonia. The same pattern is true for long-term rent: an apartment in Valencia will bring about 6% per annum before deducting expenses and taxes, in Barcelona – 5%.

Demand from tourists
Although Valencia is a less popular tourist destination than Barcelona (about 2 million visitors in 2016 versus 9 million), the number of tourists has been growing by about 5% per year over the past few years. The city has great potential: there are 313 sunny days a year, 250 days the temperature is kept above +20 ° C. 15 minutes from the city center there are two city beaches, Las Arenas and Malvaros, 10 kilometers – six wild sandy beaches. Valencia International Airport received almost 3 million passengers in 2016. “This is a great alternative to the Catalan Costa Brava. In addition, in the province of Valencia, more greenery, in contrast to the more southern Alicante, “- says Maria Kamysheva.

Property in Barcelona
Albufera Natural Park in Valencia Photo: pabkov / Depositphotos
According to The Local, citing data from Exceltur, the number of bookings for Barcelona hotels in the first quarter of 2018 is 10% lower than last year. Probably, Valencia will be one of those Spanish cities that will be able to benefit from the situation after the referendum. Investors in real estate have the same chance.

Julia Kozhevnikova, Tranio

Material prepared for 1rre.ru
Subscribe to not miss the latest articles.
We will send a selection of materials no more than once a week.

By signing, you accept the user agreement
Top 5 articles of this month
Agreement on avoidance of double taxation: how not to pay tax twice
Visas, residence and citizenship in Germany
10 best areas and suburbs of Los Angeles for recreation and real estate purchase

“I achieved my goal”: an interview with a Tranio client a year and a half after buying a profitable apartment in Budapest
In 2016, a lawyer from Kiev Roman, with the help of Tranio, bought a profitable apartment in Budapest - he told us about the search and purchase procedure in the…


How the size of the capital and the behavior of owners of foreign accounts: the study of Tranio and Adam Smith
Russia joined the agreement on the automatic exchange of financial information (Multilateral Competent Authority Agreement, MCAA), and at the end of December 2017 the OECD published a list of countries…


Mezzanine loan and equity partnership: pros and cons
Investors can invest in value-added projects (construction or renovation of real estate) in two ways: - Providing a mezzanine loan (mezzanine financing): the investor gives the developer a loan in…


Buying a mini-hotel abroad
Mini-hotel is a hotel, the number of rooms of which is not more than 30 rooms. Typically, these institutions provide services on the system Bed and Breakfast (with the English.…