Cranes for the construction of new residential buildings can be seen again in the cities Author: ANGEL MANSO
The Spanish already did seeing the rise in interest rates to their mortgages, which conditions the buying and selling market since the beginning of the year. This is reflected in Index of the register of real estate activities which elaborates college of registrars and that stopped in the first quarter of the year, setback 1.5% compared to the same period last year.
It is the first time in two years that this indicator has fallen, which, according to registrars, shows “trend change” in the relationship to the upward trend recorded between 2014 and until the second half of 2022, with some exceptions due to the pandemic. More precisely, this indicator fell 1.5%, ending a streak of eight consecutive quarters of promotions since the end of 2020.
Slowing down of activity
Data that jointly analyze the turnover of real estate and mortgages registered in the land register (demand-based approach) and the commercial activity of the construction and real estate sector (from supply) confirm slowdown in real estate activities which was noticeable since the second half of last year, but already in the first quarter of 2023 it reached a negative value.
The decline of this indicator was mainly due to a significant drop in the number of mortgages (4.2% less than the year before), but also due to the drop in the selling price (-3.8%) and the decrease in the number of them (-2.4%).
The college of registrars warns in the report that “intensive” growth of interest rates in a short time it causes this dynamic in mortgage activity, which is an important determining factor for the behavior of the buying and selling market in the coming quarters.
The slowdown in the recovery of real estate activity after the pandemic can also be seen in the latest results, since between the second quarter of 2020 (the moment when covid hit the hardest and when the suspension of activity was determined to suppress the virus) and the first in 2023, it recorded an average quarterly growth of only 1 .2%.
Source: La Vozde Galicia
I am Jason Root, author with 24 Instant News. I specialize in the Economy section, and have been writing for this sector for the past three years. My work focuses on the latest economic developments around the world and how these developments impact businesses and people’s lives. I also write about current trends in economics, business strategies and investments.
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