By Christopher Clover, Managing Director of Panorama Properties, Marbella’s longest established real estate agency, celebrating 50 years in the city.
“A further perspective to our previous report published on June 2“
Market stronger than expected
The extraordinary market activity of the last couple of months since the end of lockdown, is solid evidence that demand for the higher-end properties in Marbella is increasing as a result of the Coronavirus, a perspective shared by our agency as well as most other agencies specializing in luxury properties. See the article: “Real estate agencies in Marbella and Mallorca are immune to the Coronavirus”, published recently in the Spanish press and in the August edition of Essential Marbella Magazine.
It has long been known that the market for higher-end properties (say, over €800,000) in the Marbella area is comprised of at least 80% foreigners, which has given this market so much resilience over the years. Surprisingly, despite the severe reduction in the number of foreign visitors this summer by at least 50%, an exceptional number of highly motivated buyers have travelled to Marbella with the specific intention of purchasing properties here, and sales in all price categories are being made.
From our own agency statistics, compared with the same period in 2019, buyer inquiries have increased overall by 25% since lockdown ended on June 21st. The number of properties visited by prospective clients during that period increased by 16%. The number of sales signed up in the same period increased by 13%. And, surprisingly, the average sales prices of properties sold by our agency in this brief two month period has increased by 55%. All this, with a severely reduced number of foreign visitors over the summer months.
Positive outlook for the coming months
The most optimistic predictions with respect to the luxury market have therefore proven to be accurate. This is an important harbinger of a very solid market in the coming months, a “coming of age” of the better located, high-end property market in our area, and a solid recognition of the broad demand for the incredible life style that the Costa del Sol, and especially the Marbella area, has to offer, which were the same reasons for Panorama opening its first office in Marbella in 1970.
Lifestyle factors and the “safe harbor” of real estate are leading buyers’ motivations more now than ever
There are many factors and new trends involved in this surge in demand for Marbella property, including larger gardens, proximity to services as well as nature, the necessity to have a “work space” or study to be able to comfortably work from home and high quality construction, as we have elaborated in more detail in our June 2 report. But the prime motivational factor to purchase properties here is, as it has been for decades, the quality of the lifestyle that this area affords. Many of those prospective buyers who have been looking for years to buy a property here have made the decision to proceed now.
Coupled with the above, there is also another interesting conclusion resulting from this increase of property purchases in the middle of this ongoing Coronavirus crisis: that the purchase of real estate in our area is being seen as a “safe harbor” investment in these uncertain days, maybe even as much as gold, and undoubtedly more than stocks or many other investment opportunities.
Prices in the best areas are holding steady
Prices in the highest end of the market have held steady. Other prime properties have shown a little more negotiation room than before, and less prime properties slightly more. Of properties belonging to “motivated vendors” a high percentage of asking prices have been adjusted to very reasonable levels, which has resulted in an increase of viewings and consequently, more sales. There has also been a spurt of sales in the higher end of the market, of properties over €5,000,000 which confirms the total appeal of Marbella not only to the affluent millennials, but also to those who have known Marbella for decades, and have decided that now is the right time to buy.
After all, if we have to go through another lockdown, where would you like to be? In a city or town in Northern Europe, or in the low-rise, Garden City of Marbella, with the best climate in Europe and a true 12-month season, like no other resort city in the Mediterranean Basin?
© 2020 Christopher Clover, Panorama Properties SL