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Monday, September 15th, 2014

Prices of luxury properties fall

Splendid views of the gardenThe economic crisis has damaged many sectors of our country and has seriously affected residential properties in the real estate market, resulting in a widespread reduction in the valuation of these properties. Amongst the various factors to have exacerbated such a significant drop in house prices are location, quality and asking price of properties.

However, details regarding this fall in prices cannot entirely be applied to the Spanish luxury real estate market as, in this case, the situation can vary depending on the quality and location of properties. The latter sector differs heavily from that of the general real estate market, where prices have fallen by between 10% and (in exceptional cases) 45%, as it is calculated that the drop in prices relating to the luxury real estate market has reached an average of 20%.

Luxury property with a poolAs previously mentioned, such a fall in house prices can be attributed to specific factors concerning real estate property, including quality and location, and these high-end residences are situated in the best, most exclusive neighbourhoods in big cities, as well as in unique coastal areas. Valencia, itself, is a city which is home to a selection of luxury properties, located in districts such as Eixample and other areas of interest, including Avinguda de FrançaAvinguda de les Corts Valencianes, the central shopping area and the old town. With regard to coastal properties, the Costa Blanca is a key destination for luxury houses which are found in the cities of JáveaAlteaDénia and Moraira.

Penthouse with jacuzziThe fall in luxury house prices has now further increased the attraction of these properties in the eyes of foreign investors. International clients currently have the opportunity to, for a very reasonable price, purchase an exclusive residence in an ideal location in Spain. If we consider the quality of life in our country, together with other advantages it offers to foreign clients (for example a favourable tax system and numerous internationally-renowned educational centres), it is clear to see the real attraction of luxury real estate in Spain.

Magnificent gardenThe boom in the luxury real estate market can be directly observed on an international scale, and is reflected in a report published in 2014 by Christie’s International Real Estate: an exclusive global network of real estate brokers specialising in the finest properties, to which Rimontgó is affiliated. The report, entitled Luxury defined; an insight into the luxury residential property market, outlines certain information including the exponential growth in the high-end real estate sector on an international level, the rise in importance of foreign investors making new acquisitions and the return to the market of local clients who had previously been sidelined during the economic crisis. It also mentions the emergence of the ‘millenial’ generation: a group of young executives from the technology sector and industrial enterprises. Finally, the report underlines how the most exclusive districts in large urban metropolises have now established themselves as areas which dominate the luxury property market.

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