Despite the fact that the data confirms the end of the golden age that the residential market experienced during the end of the pandemic, “a dramatic drop in sales” is not expected, nor in prices, which according to the Appraisal Society will continue to be “stressed”. in the second half of 2023. The shortage of supply, especially in the new construction segment, and the solvent profile of the current homebuyer are the main factors that act as a containment dam against the effect that the sector may have on the sector. rise in interest rates.
“We will continue with very good and reasonable figures,” said Consuelo Villanueva, director of Institutions and Major Accounts of the appraisal company, in a meeting with the media held this Wednesday to analyze the situation of the real estate market. Thus, although there is a slowdown in house prices, the forecast is that they will continue to rise, although “in a more moderate way”, in the case of new construction due to the imbalance between supply and demand. A more accentuated trend in population “poles of attraction” such as Madrid.
“Today, six times less construction is being done than 15 years ago, despite a still sustained demand for new housing,” they said from the society. In this sense, according to data from the Ministry of Transport, Mobility and the Urban Agenda, the number of visas stood at 108,985 at the end of last year, a figure very similar to that of the previous year but far removed from that registered in 2006. in full real estate boom, when 865,561 visas were formalized.
To put an end to the tension in prices, the solution is, Villanueva commented, by increasing the supply of new construction, with a special focus on subsidized housing, since it currently only represents 10% of the residential properties that are built. . A percentage that has been decreasing compared to other times in which it came to represent almost 30% of the total housing that was built, as occurred between the years 1993-1997.
The drop in transactions and the granting of mortgages will affect the used housing market to a greater extent, according to the projections of the company. A segment with less tension in prices than that of new construction and which represents the majority of the sales that are signed. Even so, prices continued to grow in the first half in this segment -4.1% year-on-year-, although those of first-hand housing did so more pronouncedly, which registered an increase of 6.4%.
“Demand is still very active,” said Villanueva, which causes the residential market to resist the onslaught of rising financing costs, thanks in large part to the “solvent profile” of the buyer, with enough savings to avoid having to apply for a mortgage. A situation in which 38% of home buyers found themselves last April, the highest figure since December 2020. Despite this, the lower dynamism in terms of transactions is beginning to take its toll on the housing market. used housing, which translates into an increase in sales times.
