"This demand for residential housing is what is driving entrepreneurs from all over Spain to start or promote ongoing projects".
If there is one element that has activated the real estate market in recent months, it has been the acceleration of purchases by foreigners: 90,000 homes in the last year. Operations now represent 15.9% of the total and represent an increase of 6% compared to the years prior to the coronavirus pandemic. These are data from the Caixabankwhich underline the acquisition by investors from other countries, notably France, the UK and Germany.
The trend is explained, among other factors, by the emergence of residential housing as a refuge from the current high levels of inflation and also by an advance of sales and purchases to take out a mortgage at a more favourable fixed interest rate, given the prospect that the ECB will continue to raise interest rates in the coming months. And this, with certain Autonomous Communities, such as the Balearic Islands and Madrid, with property prices still rising at rates above 7%.
It is this demand for residential property that is leading entrepreneurs throughout Spain, especially in cities and along the coast, to initiate or promote ongoing projects, in the expectation that the market may eventually cool down.
Given the difficulties that, in the current framework, traditional banking is posing, private equity as a tool for alternative financing is proving to be the mechanism, the fast and transparent way, as well as effective, for the growth of companies. The Risk Department of DEXTERits director, José Enrique Chasserot, points out that "The developers are very clear that at some point there will be certain symptoms of fatigue, of exhaustion in some areas more than in others, as is natural. That is why they are resorting to private equity financing: to accelerate, to streamline, to not miss the opportunity of the moment and to do business".concludes the company's executive.
