BREXIT AND MARBELLA: PROPERTY MARKET OUTLOOK IS POSITIVE
Property professionals in Marbella have spent the past few weeks discussing what effect the UK referendum decision to leave the EU will have on the region’s real estate market, with a general consensus of no need to panic being reached.
In fact, one school of thought that the Brexit decision will actually boost Marbella’s high-end property sector—particularly for luxury villas—is starting to gain strength.
The initial theory that what had been a brisk start to the year, with sales up by between four and six per cent in the first quarter, may begin to slow post-referendum looks to be wide of the mark. Although sales figures since the June 23rd vote are not yet available, several international property consultants have reported an increase in enquiries from British buyers since that date.
Marbella real estate offers a safe haven
There have been two main reasons put forward to explain this rise: firstly, businesses dependent on access to the European single market require certainty over the future before investing—they simply can’t afford to wait for the result of trade negotiations, so have been quick off the mark in starting a relocation process from the UK to new offices in Spain and other European countries. This in turn means key staff members are also having to search for a home, many of them in Spain.
Secondly, and perhaps more importantly for Marbella, wealthy property investors seeking opportunities in real estate are turning away from London’s overheated luxury residential market and are considering high value villas in hotspots such as Marbella. This process is not unexpected and was something that had already started to happen pre-Brexit as London—the number one European destination for real estate investment—was increasingly seen to have reached the top of the property cycle, with a price correction overdue.
Middle Eastern buyers target Marbella’s luxury villas
Indeed, one firm of respected international property consultants reported a 26% increase in enquiries from Middle Eastern buyers for Marbella real estate. While the resort town has long been a favourite destination for Arab businessmen and royalty, it is seen as a significant change in direction in investment patterns away from London. With Brexit this process is expected to accelerate, as Asian ultra high net worth individuals are increasingly likely to switch their sights from a British property market in a downward cycle.
What was not really expected is the speed with which British investors have started focussing on Marbella and Spain for alternative opportunities away from their capital city. In effect they are seeking a safe haven for their money and Marbella’s property market provides just that. Prices, although making steady gains since 2013, remain well below their peak, the new build villas and apartments are of very high quality and follow the latest trends—exactly what investors are looking for—the economy is growing and of course Marbella itself is a very attractive destination with excellent infrastructure and leisure facilities.
It should also be noted that Britain hasn’t actually left the EU yet, and won’t do so for a minimum of two years. This means that British buyers and existing residents still enjoy all the rights that go with membership of the European Union, making it in many ways the perfect time to buy a villa or apartment in Marbella.
Should you be seeking an investment property in Marbella please contact us. We have a fine selection of Marbella villas and apartments for sale in the town’s most exclusive areas, including Sierra Blanca, the Golden Mile, La Zagaleta and Los Monteros.