Country Report Spain Q1-2019
“Now we have to capitalise on the positive momentum.”

Dear readers,

We have started 2019 with great optimism. And why not? The real estate sector continues to be extremely stable, and forecast growth of 2.1 % in Spain is above the average expected growth in other European countries. The signs are positive. Now we have to capitalise on the positive momentum – among other things to prepare for the end of cycle. I see great potential for the sector, above all with regard to digitalisation and the digital transformation. To ensure that we can fully exploit it, we will need support from the political world. The most important condition is a stable government majority, which will be able to implement long-term, sustainable strategies for our country.

Maria Teresa Linares Fernández

Contact

Ms María Teresa Linares Fernández
Managing Director Spain

Phone: +34 618 109905
E-mail: Maite.Linares@Deutsche-Hypo.de

Spanish Real Estate Economy Index achieves the highest increase in Europe, at 3.8%

The dramatic development of the Spanish Real Estate Economy Index at the end of 2018 was followed by a noticeable recovery in the new year. It made a clear jump in January, followed by a slight positive development in the two months that followed. It ended the first quarter at 199.3 points, an increase of 3.8% compared to the previous quarter. That is even higher than in the third quarter of 2018, and represents a sigh of relief in spring following serious winter blues.

Positive trend in all input variables

There was uniformly positive development in the input variables. The leading share index IBEX 35 rose sharply. Growth of 8.2% almost completely compensated for the dip in previous quarter. At 9,240 points, the index has almost returned to the level seen in September 2018.

The recovery of the real estate index ES BCN 5 Property was even more marked: following a healthy rise of 16.9% to its current 1,064 points, it is approaching the level seen in summer 2018.

The business climate as measured by the Economic Sentiment Indicator (ESI) usually moves less dramatically, so a direct comparison with the other input variables makes the increase of 2.3% to 106.7 points look slim. However, historically it represents a major jump: the last time it rose that fast in a single quarter was at the end on 2015.

Synopsis of Input Variables and Real Estate Economic Situations Q1-2019

Country

Stock Index

Real Estate Economy Index

Economic Indicator

Base Interest Rate

Interest Rate 10-Year Government Bonds

Q4-1801/1902/19Q1-19Delta (%)
Q4-18 / Q1-19
DE
upup
up
do
eq
do
298.2
303.4
300.8
303.4
1.7
GB
up
upup
dodo
eq
do
204.9
205.5
200.7
205.1
0.1
PL
up
upup
do
eq
do
187.5
185.9
186.5
187.6
0.1
NL
upup
up
do
eq
do
191.3
190.4
190.7
191.4
0.1
FR
upup
upup
do
eq
do
223.7
225.4
225.9
228.3
2.1
ES
up
upup
up
eq
dodo
191.8
196.4
196.5
199.3
3.9