Although the real estate market does not stop during the summer, some buyers wait until September to finish looking at and negotiating property prices. What will happen to the housing market after the summer?
Fernando Tisner, Casavo's Madrid City Manager, states that the last quarter of the year has historically been a good time for the housing market. Despite the European Central Bank recently announcing an interest rate hike, "We see no reason why this year should be any different".
Rebeca Pérez, CEO and founder of Inviertis expects property sales and purchases to increase after the summer, especially for investments. "However, those destined for the primary residence may continue to be affected by the indebtedness that families are enduring".
Jesús Duque, vice president of Alfa Inmobiliaria, believes that the real estate market will experience a slight moderation in the number of sales and purchases after the summer. This is due to several economic factors that could moderately affect the market after the summer.
"Inflation impacting the household economy is one of the main factors. Logically, as basic goods and services become more expensive, households have less purchasing power. Therefore, many will postpone house-buying decisions.
Another aspect he considers is that banks are applying more restrictive criteria when granting financing. This situation limits access to housing for certain buyers, especially those with lower incomes or who do not meet the new solvency standards required by banks.
Casavo remarks that, after the summer break, autumn is when individuals resume their decisions to buy and/or sell, and banks tend to offer better conditions for the final stretch of the year, particularly those aiming to gain market share in the mortgage market.
"We expect a drop compared to last year, following the general trend of the previous months, but it is important to emphasise that 2022 was a historic year. With this, we will see a greater stabilisation of the real estate market and transactions".
Where there will be more house transactions
Inviertis foresees an increase in such transactions in areas more sensitive to the increase in supply and where yields are also higher. "Right now, we are seeing a great demand for eastern and southern coastal areas."
Fernando Tisner focuses on the prime areas of big cities, particularly in Madrid and Barcelona. In these areas, the real estate market has proved to be more resilient throughout 2023 and purchasing these assets as an investment has withstood the rise in interest rates.
"Also, given the prospect of a shortage of credit, the creditworthiness of homes located in prime areas will be favoured by banks when granting mortgage loans," the expert replies.
He also cites that rent is still at record highs in many neighbourhoods, which boosts individuals' interest in owning a property.
Duque, from Alfa Inmobiliaria, states that transactions are taking place in large capital cities, and in primary residential homes, not holiday homes. "This is due, firstly, to the fact that these cities tend to be hubs of business and commercial activity. They have more companies, offices and business centres, which attracts a large number of professionals and workers looking to live close to their places of employment to cut commuting times and improve their quality of life."
In cities, the labour market is larger and more diversified, attracting people from different regions and backgrounds, and increasing the housing demand, both for buying and renting.
Is autumn a good time to buy a home?
Experts believe so. Rebeca Pérez points out that September and October are always good months to buy, given that supply increases, and there is not yet that pressing demand seen at the end of the year.
The Casavo expert states that, after the summer, all real estate activity is fully reactivated, "There are properties available as many owners decide to put their properties up for sale or resume the search for a buyer. Similarly, as we have already pointed out, banks that aim to gain market share in the mortgage market will have more attractive conditions for those who want to buy a property".