Housing is holding up well. This year, prices for luxury housing in Madrid will grow by 3%, and in Barcelona by 2%, according to data published by the consulting company Knight Frank and included in its report The Wealth Report.
According to the study, the real estate sector will become a key investment object for wealthy people (people with net assets of at least 50 million euros) in the coming months. Moreover, 25% of them plan to invest in real estate in 2021.
"Low mortgage rates, the search for space and privacy after a self-isolation regime and changes in mobility models have contributed to the price growth that we have seen this year in first-class new buildings," explains Liam Bailey, head of global research at Knight Frank.
The report also indicates a change in customer preferences. Houses located on the outskirts of Madrid, especially detached objects with open space, such as a garden or terrace, showed the best results, due to months of restrictions caused by the pandemic.
"Trends such as the search for housing on the outskirts of Madrid will continue for some time, although we will soon see how Madrid and the city center will regain demand and attractiveness," says Carlos Zamora, partner at Knight Frank.
The strength of residential real estate also shows that 32% of investors consider the rental market interesting, followed by logistics (28%), land for development (24%), offices (18%), industrial facilities (17%), healthcare facilities (17%) and nursing homes (14%).
"We can see investors' appetites: real estate has become a safe haven asset again," says Humphrey White, managing director of Knight Frank in Spain. The commercial real estate sector has not escaped the economic blow caused by the pandemic. Thus, although global investment in the commercial real estate sector in 2020 was 9% higher than the average for the last ten years, the indicators were worse than in 2019. In the case of Spain, we are seeing a 50% drop in investment in 2020 compared to the previous year, and the total investment volume was 7.2 billion euros