Luks Summer Autumn 2022

PAG 02 a 11 ADS 54.qxp_Layout 1 19/7/22 20:43 Página 8
Will house prices fall?
Will we have another real estate crisis?
We are seeing that interest rates have risen in the last 2 months in both Europe and the US,
the free bar of cheap money seems to be over.
These measures try to curb inflation currently at almost 10% in July, and industrial costs have
risen by over 40%.
The immediate reality is that this rise in rates will close the tap of the banks, fewer mortgages
will be granted for the purchase of homes, the requirements will increase, so demand will fall,
and finally fewer properties will be sold. As sales fall, prices will also fall, so demand and supply
will continue to meet somewhere on the graph.
This does and will affect the average price of homes, but this does not mean that the price of
all homes on the market will fall, the ones that everyone wants to buy, the properties that are
in prime locations and attractive and luxurious, can remain at high prices.
As always in the past, for obvious reasons, the lower value homes, those in less attractive areas,
small towns, far from the coast, rural areas, etc., will start to fall in price.
Does this mean that another real estate crisis is coming?
Probably yes, but very different from the previous one of 2008-2010: Banks are not as exposed
with loans to developers and with dubious accounting, developers have been more
conservative in the last 8 years, areas of Spain such as Malaga, Barcelona and Madrid are today
more attractive than ever for foreign buyers, with higher purchasing power than nationals, and
with options to telecommute wherever they please: we have been seeing throughout this year
how this type of buyer has fed and feeds the real estate market in these privileged areas.
In such an environment, with banks turning off the tap, average prices falling and interest rates
rising, the best option for buying a home is to rely fully on the professionals: the Real Estate
Agent and the Mortgage Financial Advisor.
In Finance Consulting Group, with 18 years of experience, we advise and accompany you
throughout the process of obtaining a mortgage loan, thanks to the good relationships and
special agreements we have with banks, we get the best mortgages for our clients in the
Spanish market.
We carry out the initial study for free and without commitment:
Contact us at:
info@financeconsultingroup.com
Alberto Bertazzi
Director
FCG - Mortgage Specialists
(+34) 657 111 073
financeconsultingroup.com