3.4 million empty homes, falling prices and foreign money: the Spanish housing crisis by numbers

Picture: Billy Ehrenberg 

 

Additional reporting by Nassos Stylianou (@nassos_)

Spain has the highest number of empty houses in Europe: 3.4million of them at a time when many are facing evictions for defaulting on their mortgages. House prices in Spain are also at an all-time low, according to Instituto Nacional de Estadística (INE) numbers for December 2013.

What is more with prices so low, record numbers of foreigners have been flocking to buy houses, with numbers tripling since 2009.

These things in themselves are not news; we’ve know this for a while and it’s been well publicised in the press both in Spain and abroad.

What is an interesting exercise is to look at where these empty homes are and how much house prices have dropped in those regions.

We don’t have the data for where exactly expats are buying the most houses, but we can make an educated guess that it will be on the Costa del Sol and the Costa Brava.  

So first lets look at where the empty houses are. I’ve plotted them on a map, with the bigger red bubbles corresponding to larger amounts of empty homes:

 

Click on the bubbles to get the stats for each region.

The first thing we notice is that the largest numbers of empty houses are in the Valencian Community and in Andalucía. This figure holds true, even when we look at the percentages:

18.5% of houses in Andalucía are empty - almost a whopping one in five. Valencia isn’t far behind on 14.7%. These are big numbers.

Surprisingly, Cataluña is third with 13% - despite being one of the few regions to have seen a drop in the total number of vacant homes.

As you may have suspected it seems that a large number of houses were built in theses areas because they are popular for second homes, both for Spanish nationals and ex-pats.

So where are the cheapest houses? Or rather, where have the biggest drops occurred?

The INE published the figures, and as you can see from this graph they’ve been dropping steadily since 2007 in some communities, with all areas having experienced large declines.

You can use the drop-down menu in the top-right of the graph to choose which regions you want to include or exclude. Click on the names of the regions in the legend to select the line for that Autonomous Community.

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What is interesting is that, despite having the highest number of empty houses (both by volume and %), houses in Andalucía and Valencia have held their prices far better than other regions.

Andalucian properties are going at 73% of their 2007 value and the Comunidad Valenciana is seeing houses sell for 68% of 2007 prices; the third and eighth highest on the list, respectively.

Not so Cataluña. Prices have dropped to 55% of their 2007 level for the Catalans, despite that overall reduction in the number of empty properties.

Why might this be? One possible conclusion is that the number of foreign buyers snapping up cheap properties could well be preventing more pain in Valencia and Andalucía, where the areas around Benidorm and Malaga/Marbella remain favourites for ex pats.

Let’s have a quick look at who it is buying the most properties. Click on the tabs at the top to change between numbers and percentages. 

 

 

By far the biggest buyers are the Brits - which will surprise few - but the figure fails to take into account is that 12.85% of all new house purchases in the fourth quarter were by non-Spaniards. El País has a more in-depth article here.

How long that support will last is anyone’s guess, but the number of foreign buyers is higher even than before the crisis, perhaps showing how any recovery from the crisis is leaving Spain behind.

How long it will last is anyone’s guess.

 

Nassos Stylianou is a freelance data journalist working in London. You can read his blog The Data Party here.

 

Comments

[Publicado por: Billy Ehrenberg]

Thanks for the comment Michael - you are quite right.

I saw in a piece by the Telegraph today (link below) prices in London have risen as much as 18% and may rise a further 30% over the next five years.

As you say, there is no reason to believe the influx will be stopping any time soon... will have to keep an eye on the stats!

http://www.telegraph.co.uk/finance/personalfinance/houseprices/10756343/House-price-boom-ripples-out-of-London-across-Britain.html

[Publicado por: Michael]

There is little reason not to expect the trend of UK buyers in areas like Andalucia to continue. The same economic factors that were there for the 1st half of the last decade are repeating. Significant growth in UK house prices (some areas of London have increased by more than 10% in the last 6 months) means lots of spare equity to secure mortgages at historic low interest rates. The opportunity to buy at the bottom of the market, therefore with the potential of some growth ( if you are prepared to wait a few years); have a home in a beautiful, politically secure and now economically safe area are the same factors that existed in the boom times.