The number of unsold new build homes on the sales market almost halved in 2011 as more bargain hunters snapped up reduced priced properties, while construction output has fallen significantly.
According to the Association of Builders and Developers of Malaga (ACP), property developers sold 10,000 new homes last year, representing about 40% of the housing stock on the market at the beginning of last year.
The property market in Malaga, home to the Costa del Sol, has suffered in recent years because of a chronic oversupply of homes. But the figures provided by the ACP suggest that market conditions are improving, thanks to the fall in supply.
Property sales have been boosted by dramatic price reductions, while house building activity has come to a virtual halt in the past three years, in order to allow the glut of homes on the market to be absorbed.
“Given the long lead times in the building industry, there could be an acute shortage of new housing a couple of years from now,” said Mark Stucklin of Spanish Property Insight.
He added: “Shortages will be made worse if demand recovers to its normal level of around 22,000 new homes a year, based on the size of the population. Unemployment or fear of unemployment is keeping many potential buyers out of the market.”
Source International estate agent
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Developers in Malaga province (home to the Costa del Sol) sold 10,000 new homes in the course of 2011, almost half the stock of 25,000 new homes on the market at the start of the year, according to the Association of Builders and Developers of Malaga (ACP).
Lower house prices have helped boost sales, and a huge drop in housing starts over the last 3 years, most acute in popular tourist resorts like Marbella, means that the housing glut is shrinking fast.
Given the long lead times in the building industry, there could be an acute shortage of new housing a couple of years from now.
Shortages will be made worse if demand recovers to its normal level of around 22,000 new homes a year, based on the size of the population. Unemployment or fear of unemployment is keeping many potential buyers out of the market.
45pc of Malaga’s 200,000 unemployed are young adults who be first time buyers looking to start a family if they could afford to.
Much of the blame for this sorry state of affairs lies with politicians says José Prado, President of the ACP. “In recent years they’ve done nothing but earn a fortune from construction and made no effort to attract investors.”
Source Spanish property Insight
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