MADRID: The signs are beginning to look more and more positive for the property market in Spain, and in terms of economic health one of the surest indicators that this is the case is that construction activity appears to be recovering.
If more homes are being built, this can be taken as proof that demand is improving and therefore that the market is growing, and the figures for May which have just been published show that during the first five months of this year licences to build 19,134 new homes were requested. This is not only the highest figure for the first five months of the year since 2012, but also represents a 28% increase compared to 2014.
The breakdown of licences requested so far this year shows that 13,585 were for properties in apartment blocks, 35% more than last year, while the total for individual properties rose by 13% to 5,537. The average floor area for apartments is 112 square metres while for individual properties it is 201m2. Hopes are now high that the annual total for 2015 will show a year-on-year increase, following the stability achieved last year after seven years of decline in residential construction.
An idea of the scale of the boom and bust cycle can be gleaned from the fact that in the first three months alone of 2006 there were over 217,000 licences granted, approximately 20 times more than this year. Similarly, in September 2006 construction licences were requested for an astonishing 126,753 residential properties in Spain, but by August 2014 the total had fallen to just 1,585.
The figures published this week also show that if licences for extensions and house reforms are included there were 30,140 requests in the first five months of 2015, an increase of 20.5% compared to last year.
