Spain Property Guide Spring 2021

Looking back at 2020
and forward during 2021
It’s fair to say that most of us are ready to look back
at a year that will go down in history as one of the
strangest ever. 2020 will not be remembered fondly
by most people around the world, having brought us
a virus and accompanying restrictions that have had
a profound impact on the economy and society, on
the Costa del Sol as elsewhere, but it was also a year
that allowed us to slow down, take stock and perhaps
appreciate the more important things in life.
This includes side-stepping our increasingly frenetic
lifestyles, analysing what is really important to us and
spending time with our families. While we missed
our social lives, our freedom of movement and saw
businesses and careers impacted, we also had a rare
chance to reconnect with home and family, and
this again led to a renewed appreciation for home
and hearth – with a surge in home improvements,
redecoration and renovations as a result. Travel suffered
in favour of staying put in your own backyard, much like
a temporary return to the not so distant past.
This break from our constant rushing about, flying
around and consuming at full speed had social and
economic repercussions within the human realm, but
nature also showed us just how much we impact upon
the environment by staging a humbling comeback
in record time, with weather patterns showing signs
of restoration, and all manner of animals returning to
placing they had not been seen for long years. Most
people have seen the images of dolphins in the Venice
lagoon, but they also visited the shoreline of the Costa
del Sol in a marvellous display!
A RESILIENT PROPERTY MARKET
While the Spanish economy, like most others, showed
a sharp decline in H1 following the near-closing of all
economic activity during the first and most intense
lockdown of March-May, the third quarter registered
a similarly significant rebound upon the relaxing of
restrictions, and the final quarter of 2020 is expected to
have produced a smaller return to contraction, resulting
in overall negative growth of the Spanish economy for
the whole year. No major improvement is expected
for Q1 of 2021, but from then onwards rapid recovery
growth should follow a gradual return to normality.
Within all of this, the Spanish property market proved
remarkably resilient. This is especially true of ‘top areas’
such as the Balearic Islands and the Costa del Sol, where
demand for properties for sale rebounded strongly in
Q2 and then again levelled off to a lower yet sustained
level for the remainder of the year. There was no major
dramatic drop in transactions, and prices of new-build
homes and the most attractive real estate remained
12 l SPAINPROPERTYGUIDE.COM
solid, with only older and less appealing properties losing
a little ground, though of course the travel restrictions
imposed on most potential buyers have had a negative
effect on the sector.
PROSPECTS FOR 2021
Experts predict the present status quo to be
maintained into the beginning of next year, when the
‘weaker’ properties, i.e. older homes or those in less
attractive areas, are expected to drop in value by up
to 10-20%, which of course creates fresh opportunities
for investors and savvy buyers. In the most in-demand
areas, however, such opportunities also exist but will be
fewer, so you have to work with your agent to find them
in homes, building land and commercial real estate. The
resurgence of the property market will broadly mirror