There are a number of reasons as to why the Marbella property market is set to boom once again in 2016. Aside from the weakening Euro against the pound, the attractive weather and living conditions, here are the facts.
A diversified source of buyers. The property market, as well as the economy in Marbella, is not strictly dependent on the national economy. At least 85% of buyers of Marbella property come from outside Spain, especially other European countries, where their economies are relatively strong compared to Spain, and their businesses are prospering. Whilst Spanish property buyers have been virtually absent due to the severe economic crisis throughout Spain, the foreign market has more than compensated for this.
Naysayers are silent. There are thousands of potential buyers who have been waiting for years for the right time to proceed with a purchase in Marbella and the major lifestyle change that owning a property here implies. News that the crisis is over for the Marbella property market, it has now convinced even the most ruthless predictors of continuing market crisis that they had better move quickly before prices increase significantly. With the year-on-year sales volume increases in Marbella, the perceived risk of buying property now at current market prices has been eliminated.
A weak Euro. The weakness of the Euro has provided an additional incentive for purchase in Marbella for non-Euro zone based buyers. The Pound, for example, increased 14% over the past year, reaching levels not seen since 2002. The Euro has also dropped to levels not seen against the US Dollar since 2002. The Swiss Franc, with its revaluation in 2014, has also attained a record level against the euro.
Still low mortgage rates. With interest rates at record lows coupled with fierce competition among Spanish banks, there is plenty of motivation for purchasers desiring a mortgage. Typical 20-year variable rates as of April 2015 are euribor (nominal rates) +1.70%, and fixed rates from 2.75%.
Relatively high yields compared to other types of investment. The percentage return on bank deposits, especially for Euro and Dollar-based clients, is so low (even negative, for example, in Switzerland) that many are turning to alternative investments, even though not as liquid, which will provide higher medium-term returns. Of this larger group, many are turning to an investment in life-style which, combined with a well-timed investment in property, solves two problems at the same time.
A safe location, a safe investment. Marbella is regarded as a safe, quality haven within the protection of the European Union when compared to many other destinations today. There are literally hundreds of press articles published in the last six months touting good news about the strong recovery in Marbella and further evidence of the overall economic recovery of Spain itself.