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Spain's property portals see record usage despite real estate slump

By Clara-Laeila Laudette

Spain's property portals are betting historically low interest rates and incoming European aid will boost real estate, but data show sales diving, household debt rising and prices flatlining even after Spain's lockdown ended in June.

Fotocasa and Idealista, two of Spain's largest property portals, saw record user activity in the past three months.

Fotocasa communications director Anais Lopez highlighted a 40% year-on-year jump in traffic in June.

"All the real estate agencies we work with say they're seeing unprecedented interest in changing homes," Ms Lopez said, adding that Fotocasa's page visits and contact rates were well above pre-pandemic summer averages.

Idealista spokesman Benat del Coso said online mortgage brokerage requests over the summer were 20% higher than normal.

But Bank of Spain data show house sales in freefall, despite intensified interest from Spaniards who dread spending a second confinement in the same residence and prefer spacious homes with gardens and balconies.

Nationwide, house sales plunged 43% to 75,00 in the second quarter, the Bank of Spain said last week, with transactions in traditionally red-hot markets like Madrid and Barcelona falling 20.2% and 17.3% respectively.

Property prices tightened over the same period, said Spain's College of Registrars, with the average quarterly growth rate at 0.44% - a substantial slowdown on past quarters - and some of the Registrars' methodologies even yielding small decreases.

Idealista noted prices dropping 0.1% in Madrid and 1.1% in Barcelona in August. Second-quarter rental prices sagged 0.2% before falling 0.8% in July, Fotocasa registered.

With financing hard to come by and mortgage indebtedness rising as cash-strapped homeowners seek liquidity, Spaniards are reluctant to sell property at "pandemic prices", while prospective buyers struggle to meet tougher lending requirements.

Tourism- and hospitality-dependent Spain saw unemployment rise by 0.8% in August, felling hopes of a V-shaped recovery after the coronavirus wiped out 20% of its second-quarter Gross Domestic Product.

The prospect of recovery for Spain's real-estate sector has retreated since June despite the easing of coronavirus-prevention measures, even as home prices surged in other countries including Britain. (Reuters)