Malaga – Costa del Sol | Experts discuss the current rise in the property market but fear a slow-down later this year
José Carlos León, the head of the Leading Property Agents association, speaks to SUR in English at the charity conference in Estepona
“We’re as we were in 2007,” said José Carlos León, CEO of Nvoga and head of the Marbella-based real estate association Leading Property Agents, which includes the main groups in the sector. “But we could be victims of our own success,” he warned.
Property sales on the Costa del Sol have increased, especially in the luxury sector. The problem, said León, “is the increase in construction costs of new properties, of between 3% and 4%”.
As part of the Costa del Sol real estate sector’s III Solidarity Padel Tournament, representatives of the sector got together last Friday in the Felipe VI congress centre in Estepona for a conference. There, in a series of talks and meetings, they debated the main challenges facing the sector.
There was one issue on the programme that many were particularly keen to address, but few wanted to risk making a prediction: the possibility of a real estate bubble.
“The market is worrying. There are signs of it slowing down in the last quarter of the year,” said León.
What’s more, “there is a problem of accumulated demand” which, according to León, will be solved in part when the new town master plan (PGOU) is established.
“It all came at once and in 2022 we have made transactions worth 10 million euros,” he said. However, in this second quarter of the year, “signs of slowing are already evident”.
If 2021 was a real “record-breaking” year, this one could be even better, despite the aforementioned concerns. According to León, “property is still a secure asset”, despite the increase in the Euribor, the index generally used to calculate mortgage loan interest in Europe.
“Luxury properties are selling best, as this is not affecting by fluctuations as buyers do not depend on mortgages,” he pointed out.
A key question was also the return of Spanish customers, “for residential, rather than holiday tourism”. And above all, the appearance of a new type of customer, Americans and Canadians, who visit the Costa del Sol as tourists and “go home fascinated by it”.
“They are looking for comfort, tranquillity and security,” said León. He stressed the latter, as it gains importance given recent events. However the expert, who took to the stage of the Felipe VI congress centre to dance and sing (We Are The World, no less, to the astonishment of the audience), is cautious. “The sector has to be more professional, there’s a lot of unqualified practice,” he said.
One of the main points is the figure of the estate agent, questionable, in his opinion. “The customer must have the guarantee that everything will go smoothly when they make their purchase,” he said.