Property Market in Marbella in 2020 – the effects of COVID-19

The beginning of 2020 saw a buoyant property market in Marbella and great optimism for the year ahead. All segments of the market were performing well and most professional real estate agents had a pipeline of prospective clients in the offing. Move2Marbella enjoyed this positive start by closing a deal on the sale of a luxury villa in one of Marbella’s premier gated community with a price tag north of 3M€.

Thank the Lord we did, as only a few short weeks later, COVID-19 arrived in Europe and forced us all into a period of confinement and an inability to work (especially for those of us in the property business).  This obviously had an immediate impact on the property market and sales grind almost to a halt immediately. After all, if you cannot show a property to a potential buyer or speak with an owner and evaluate their property, there is little one can do to create business. Thankfully, in the previous year we had invested quite heavily into new technology and we have a decent inventory of properties where we had made a Virtual Tour. This worked remarkably well during the quarantine and as a result we actually managed to close four sales, without ever having met the clients.

 
Admittedly, this is significantly down on what our normal sales figures would be like at that time of year, but we were very happy that we had at least managed to generate some income for the business.  Of course, this was also possible by the fact that people were spending far more leisure time on their computers, phones and tablets than they normally would!! However, we, along with many of our colleagues in the real estate business, have realised how important it is to utilise new technologies in the marketing and promotion of our portfolios. I suspect that many real estate professionals will invest even more time and effort into Video and Virtual Tours as a result of the COVID-19 situation.

The impact of the quarantine and subsequent travel restrictions on the property market was significant, especially in Marbella that has a much higher percentage of foreign buyers than other areas of Spain. Property purchases in the second quarter declined to 8.000, down from 15.000 in the first quarter (source: National Register of Property Statistics)

 

 

So, as the restrictions began to ease, we eagerly returned to work to try and regenerate the business that we were enjoying before the virus hit us.  There was much speculation, both amongst clients and industry professionals about the property market and how it has been impacted by the quarantine. Of course, there was the “doom & gloomers” who feared another crash in the economy and subsequent fall in the property market.

Likewise, many investors have liked to use this as a way to leverage a better price on the purchase of an asset. However, although it may be early in the day to venture this opinion, it seems that not only has this not happened but there has actually been an increase in enquiries. This may be down to the fact of enforced confinement for 3 months and are simply the same clients that were originally intending to visit earlier in the year. Whatever, the reason, the actual result has been a gradual return to normality. The dreaded “Crash” has not materialized and prices have not varied from what they were pre-COVID-19.

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