The current situation surrounding the coronavirus and associated lockdown not just in Spain but in many other countries in Europe and around the world has raised questions among industry professionals, homebuyers and vendors alike. In this article we aim to answer the main ones, but if you would like additional information, please don’t hesitate to contact the Nvoga team.
The impact on the real estate market in Marbella
The lockdown forced upon us by the coronavirus situation has greatly affected economic activity levels and in so doing the economy’s output. While the bulk of restaurants, hotels and shops have had to close, with airlines operating on minimal levels, a lot of people can still work from home and some industries, such as supermarkets, online stores and courier companies, are on overdrive. For the real estate sector, it means that while people can continue to search for properties online and be in contact with estate agents, the physical viewing of potential homes to buy has become very difficult for the time being. As a result, a lot of decisions on buying or selling a home have been put on hold, and the sector eagerly awaits the end of lockdown and the gradual return to normality thereafter.
Are buyers still looking?
Many continue to do so, especially now they have more time at their disposal, so online property searches continue albeit with a little less volume unabated in volume and intent. People are researching homes and contacting agents, who provide them with further information. It is therefore important for vendors and agents to remain active and responsive at this time, even if the number of actual home viewings and therefore also final transactions is greatly restricted until we leave the confines of lockdown.
Will property prices be affected?
In the short term they are likely to drop, and though this is not what homeowners and vendors want to hear, it is good news for potential buyers and investors. Many of the latter will hold off with decision making in expectation of a downward price trend, so people keen to sell their property must bare this in mind, and adjust their asking prices accordingly. The demand is there and will eventually level out prices again, but as this could take a few months, possibly into 2021, especially with those properties that are in the mid to high range. It is actually the lowering of prices that will entice buyers and investors back into the market in numbers, however if you are a seller who does not want to lower the price of your property, an option is to either rent it out or wait for a recuperation in the market.
How will tourism on the Costa del Sol be affected?
Restaurants, cafés and similar venues that depend on physical customers and have lost them during the lockdown period have suffered the most, losing an important part of their annual revenue. However, as long as they can be up and running again for the run-up to the summer and enjoy a decent high season and second half of the year, many will be able to overcome this hurdle. The same applies to hotels, travel companies and the retail sector. Ultimately, it is seasonal businesses depending on the spring period, such as nurseries and landscapers, who will be most affected, just as summer-based businesses might escape without too much damage.
In all sectors, including real estate, the strongest, most innovative and flexible will overcome this challenge, and with its enviable climate and lifestyle, Marbella will continue to be as desirable as ever.
