Is it a good time to open a real estate agency?
The real estate business in Spain has been cataloged by some experts as a cyclical growth sector. However, in relation to other productive sectors (such as the automobile business or investments in variable income), this «cyclicality» is more limited due to the fact that housing is an essential good for people; while cars or investments are not to the same extent.
In the midst of a crisis like the current one, for some it could be a "risk" to open a real estate agency. However, things can go well if you have a strategic plan to cope with it. And in this situation the solution is to convince customers that they have to lower the price and put a value according to what exists in the market. On the other hand, it is also necessary to have a list of investors ready when the situation begins to reverse.
What is the current moment in the real estate market?
According to Gozalo Bernados, professor of economics at the University of Barcelona, the real estate market is not strictly heading towards a crisis, rather it seems to be heading towards a new real estate boom and even towards a possible bubble. This scenario would be possible within the framework of an unprecedented international economic recovery and progressive GDP growth.
What does the real estate sector in Spain need to function well?
The projection in terms of job creation for the coming months is favorable, according to experts. In September, 64,100 employed workers were registered, a higher number in relation to that registered in December 2019. During 2022, a historical employment record is expected, which it is estimated will also happen in 2023. Currently, in specialized professions, it is known that there is an excess demand for workers.
Increase in demand for first homes by young people
Access to housing for a group of people "under 35 years of age" will be possible only under frankly good mortgage conditions that allow them to access the purchase, even if they do not have significant savings.
The purchase of homes by this segment of young people can boost the demand of another segment called "improvement", in which there are people between 35 and 45 years old who will sell their home, smaller and cheaper, to people of the younger segment.
Is the year 2022 expected to be very good in the real estate market?
According to the data collected by the specialists, the year 2022 will be a year in which we will see a 15% increase in real estate transactions and a 10% increase in prices. This means that for a real estate business, income can increase by around 26.5%, simply as a result of the combination of price increases and transactions. Undoubtedly, an increase is difficult to achieve in other types of business.
What is expected for 2023 and 2024?
Real estate agency revenue growth
If interest rates stay the same and real estate management stays average, revenue growth for 2023 and 2024 could be around 14%. And, if the business is well done, either because it has an advisor, or because technological solutions are offered, which help to develop a series of skills that distinguish it from the competition, the logical thing is that this increase in income can be well above that number.
New investments in the sector
In the savings ranking of European countries, Spain is ranked number four. It is estimated that Spanish savings in 2020 have been 104,000 million euros (126.6% more than in 2019). This money will go mainly to consumption. However, an important part of Spaniards will wonder where to invest it, with the real estate market being one of the main options for these investors.
In this sense, according to the specialists, the forecasts are that in 2024 around 750,000 homes can be sold. It will be a market that will multiply the homes sold in 2013 by approximately 2.5, which is the year in which the fewest homes have been sold in the last 21 years. If compared to the 485,000 homes that were sold in 2020, a very interesting development is expected in the sector.
Source: Franquicia Remax