THE MARKET RENT PENALIZED AGAIN

  • 1 September, 2017
  • News

The rental price in Barcelona suffers a sharp increase in recent years and exacerbating the problem of access to housing. An offer small and very sensitive to the tensions of local demand, and now international, are behind the phenomenon

  • The market rent again criminalizes Photo Archive.
  • The market rent again criminalizes Photo Archive.
  • The market rent again criminalizes Photo Archive.
  • The market rent again criminalizes Photo Archive.

The tourism sector refuses to be the culprit, but there are who notes

It is expected that rents should continue to rise in the coming years

Gonzalo Bernardos think that the rise is artificial and that reason is structural

Renting apartments in Barcelona is shot and complicates access to housing for those most sensitive such as young people or the unemployed, and in general the many families who have not yet recovered the lost income with the crisis.

Rental prices have risen on average more than 25% from the first quarter of 2014, but in some districts, such as iris or Old Town, they have about 30%. After the decline that began in 2009 lasted until 2013, the comeback the last three years the average rent is located in the city above the record that was achieved before the crisis. The contracts in the first quarter of this year had an average price of 845 euros for the whole of the city. I forecast the real estate analyst and professor at the UB Gonzalo Bernardos is to continue to rise 8% this year and between 4% and 5% next year. “It is wrong to think that this is a bubble, are structural causes which are behind this dynamic and we must get used to living in Barcelona is expensive,” he said.

What are these structural causes? Basically a limited supply in a context of growing demand. If we add that the administration has few tools to take part in the board game we can say that the housing market is supply, which means that it establishes the rules that have properties . Demand has no other choice but to adapt. The Government has set a benchmark rents, but their effectiveness is quite unknown.

Supply.

The housing Barcelona is quite consolidated and the lack of sun new limits. In addition, the planning does not distinguish between uses in a way that is determined by the market at any time if the property is used in homes, offices or hotels, recalls the planner Maria Buhigas. The expectations of the owners who are looking to maximize your investment, you can also determine the type of ownership of assets. For example, during the crisis of the brick, it was interesting when sold many properties entered the rental market, increasing supply so that incomes fell. What happens now is the opposite. A study by property consultant Forcadell estimates that ten leases expire, the owners put up for sale six properties. So the offer of rent is shrinking and is one of the factors contributing to the rise. We must believe that the rental market represents less than 30% of all housing in the city.But it is not the only factor. There are also apartments that are rented to tourists for short stays. They are the homes of tourist also pressured the market. Or not? The Association of Barcelona Tourist Apartments (Apartur), which brings together the managers of these apartments, you do not think, and commissioned a consultancy study InAtlas that woman right. The document notes that apartments (13,555), legal and not only represent 1.64% of the total housing stock of the city of Barcelona (825.000). In addition, the crusade against the Government and the City Council has reduced illegal supply the total number of apartments available to tourists last two years, just when rents were rising incomes, “No we err on the diagnosis,

The study InAtlas is another replica of the City Council that was made public in June last year, whose conclusions indicate the opposite. That study focused on the great distance between the profitability of residential and rental rates. According to the occupancy of the flat income tourist who enters the landlord is between 2.35 and 4.07 times higher than the traditional model and average yield ranges between 7.68% and 13.40% when the alternative is between 3% and 4%. If you add other factors such as the feeling of vulnerability that has the owner rented to a resident, the temptation to move the floor of the housing market than the usual tourist housing is understandable. “Clearly Rental hits in the residential market,” said Maria Buhigas,

The international interest in Barcelona is largely an engine of what is happening. Is behind the phenomenon of the apartments but also the reform of many properties considering the global trading market. Worthwhile to look back and remember that Barcelona grew up at a time in its history, under the model of vertical property, this is especially so in districts such as Ciutat Vella and the Eixample. The owner of the property reserved the main floor and rented the other apartments. Paradoxically this structure, which in the past had endowed the housing market force units on lease, is now facilitating the purchase of entire buildings to investors and rehabilitation considering a buyer profile more purchasing power, often abroad.

Tsunami investor.

The residential is only part of the interest of foreign investors for Barcelona which has witnessed Miquel Laborde, Marcet Laborde real estate agency. He explained that the last two years the Chinese fund, Russian, US Cathars Indians stormed the city with money and desire to buy local hotels, offices … “There have been outstanding operations, but Barcelona is a small capital for their claims, “says Laborde. However, “local investor who is leading the market by volume and quality of Barcelona, ​​but prefers to move in the shadows,” said Laborde. This realization is leading to Gonzalo Bernardos said: “Who drives up housing in Barcelona is Catalan bourgeoisie has no equity and buying assets with little top-level debt,” he said.Certainly in the context of low interest rates and few investment alternatives, part of the capital is returning to brick. In recent years have proliferated Socimi (listed companies stock investment in the property market) instruments of investment tax advantages if the assets acquired primarily engaged in renting and preserved for at least three years. The aim of these conditions is not feed speculation, but that does not mean that aspire to a respectable annual return between 4 and 6%.

In Socimi some have a varied menu and other more specialized areas but only buy assets first class to ensure the revaluation. Some family offices (managing large fortunes) have been grouped into Socimi to have more muscle and be listed on the stock exchange.

The question is what will happen when the winds now move the market investor in a sense change and do so in another sense? It remains to be seen, but Miquel Laborde remember the city center or at the worst moment of the crisis diminished interest in buying properties.

Meanwhile, local demand for private housing who want to live is also increasing as the economy improves. However, it is expected that factors such as demographics have a role in determining how previous cycles, since household formation will be less. However, the consultant Forcadell estimated housing needs in the province of Barcelona will be between 3,000 and 9,000 annually.

Public housing.

For Carles Cabrera, general director of the Institut Cerdà, the fact that Barcelona has a fleet of rental social “five times lower than the EU-fifteen” is a factor that determines when public officials have a role in defining the city model, which remains in the hands of the vagaries of the market. Closely related to the issue of social apartments is that of empty apartments, on which the City Council has commissioned a census should reveal how many there are in the city. Gonzalo Bernardos concealed the existence of this park is a “myth”: “There are no empty housing in big cities, there is little the owners who can not afford the rehabilitation and are badly damaged.” Economist advises allocate public money to buy apartments in Barcelona and thinks that it should act in key metropolitan and generate other towns nearby. “The possibility of a park office in Barcelona is zero,” he insists. In this regard, the localities of the metropolitan belt back to get young people can not live in Barcelona and rising rents spreading like wildfire throughout the region.It is expected that access to the increasingly worsening housing.

FIGURES

13555
Tourist homes (HUT)
Collect all the offer, legal and illegal. This is 1.64% of the total.
13.4%
Profitability of HUT
A study indicates that the HUT yields are between 7.68% and 13.40%
825000
Homes in Barcelona
It is the total housing, of which about 30% would hire.
25%
Rising rental
Between 2104 and the first quarter of 2017.

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