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Tuesday, October 11th, 2016

Demand for luxury Marbella properties and number of foreign investors continue to grow

As shown in the report provided by Reuters, the amount of capital allocated to building properties in 2015 was eighty times greater than that in 2014, largely thanks to overseas investment. This trend has also led to a strengthening of the luxury property sector in Marbella.

Foreign investment in Marbella’s property market

Following the crisis in 2008 the housing market was badly hit and many properties were not sold due to their poor construction quality and/or the fact that they were located outside of the most central or exclusive urban areas.

However, Marbella has not suffered in the same way given that international clients in these areas have always demanded the highest construction quality and prioritised the area in which they decide to invest, something which local developers have realised during recent years. At the start of the year, professionals from the property industry published a report highlighting the shortage of properties in Marbella, especially in the luxury sector, and so it was therefore vital to encourage the development of new projects. As such, developers have decided to focus on building luxury apartments and villas.

Funding from the USA, Europe, the Middle East and Asia for projects worth hundreds of millions of euros in Marbella and surroundings areas has already begun to appear. Moreover, according to figures released by the Ministry of Finance, on a national level one third of the €22 billion of foreign investment during 2015 was pumped into the property and construction sectors. Ernesto Tarazona, partner of Knight Frank, informed Reuters that although there are still some national investors, the role played by international investors has been key in revitalising the real estate market.

DM Properties reiterates this, since clients from countries including the UK, Saudi Arabia, Germany, Belgium, Sweden and Norway are the ones who most frequently buy properties both in Marbella and up-market residential areas such as La Zagaleta. Furthermore, clients from Russia are also taking interest again, having recovered from the impact caused by the devaluation of their national currency, the ruble.

Although construction activity is much lower than it was in 2007, professionals from the industry have noted that it is now more durable and secure, as well as being less vulnerable in the face of any economic fluctuations. Therefore, by taking advantage of an improvement in the economy, foreign investors have waited for the perfect opportunity to purchase properties during the course of the last year, particularly in highly renowned coastal spots and large cities such as Madrid and Barcelona.

If you are interested in purchasing a luxury property in Marbella, do not hesitate to get in touch with us. We have a broad selection of luxury villas and apartments in the best parts of the city.

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