December 2016 Residential Market Report Barcelona and its Metropolitan Area
Introduction and Methodology 1 Contents Geographic Distribution 2 Conclusions of the Study 3 Forecasts 2016-2017 4 Central Barcelona 5 Barcelona and its Metropolitan Area 6 2
Introduction and Methodology
Intro This report analyses the open-market new-build residential market in Barcelona and the main towns in its Metropolitan Area. The fieldwork undertaken for this report was carried out over the months of October and November 2016 and was finalised on 1 December 2016. The aim of this study is to analyse the housing market for new-build open-market apartments located in the city of Barcelona and the towns in its surrounding Metropolitan Area, as detailed in the following section. The report has been carried out based on 151 open-market apartment developments, of which at the closing date of our fieldwork (1 December 2016) 89 were being marketed, 57 had been sold, whilst the construction and marketing for 5 had been put on hold. Data was collected after carrying out extensive research on the different districts of Barcelona and 10 of the main towns in the Metropolitan Area. The system adopted in order to obtain data was carried out by comparing residential sales prices. Adopting this method, means that whilst every care has been taken to provide accurate data, Aguirre Newman does not accept any responsibility for the information provided on the surveyed developments. 4
Geographic Distribution
2. Geographic Distribution In the study of Central Barcelona, the various districts that make up the city of Barcelona are not generally treated just as one area, but rather various areas defined by their level of exclusivity. Hence the areas of Barcelona that are located in the prime area are the most exclusive, whilst those that form part of the 'A-3' area are the least exclusive. The division of areas and the housing developments within them has been based on Aguirre Newman s knowledge of the Barcelona residential market; also taken into consideration are the specific location, building specifications and the surrounding area. ZONA DISTRITO PERÍMETRO Sarriá - Sant Gervasi Pza. Francesc Macia Av. Diagonal Av. De Sarriá Pº Manuel Girona Bosch I Gimpera Cardenal Vives i Tutó Fontcoberta Carrer dels Vergós Pza. de Oriente Vía Augusta Calvet Travessera de Gracia Vía Augusta Av. Diagonal Pza. Francesc Macia. Ronda del General Mitre Vía Augusta Ronda de Dalt (Ambos lados) Av. República Argentina Ronda del General Mitre. PRIME Les Corts Les Corts Av. Diagonal Av. De Sarriá Travessera de Les Corts Gran Vía de Carles III Av. Diagonal D esplugues Eduardo Toldrá Ardemans Cº de Finistrelles Nogueres Avellaners Ametllers Font del Lloc Mare de Deu de Lordá Montevideo Av. España Bosch i Gimpera Mulhacén Pº de Manuel Girona Av. Sarriá. A - 1 A - 2 A - 3 L Eixample Sarriá - Sant Gervasi Les Corts L Eixample Ciutat Vella Ciutat Vella Les Corts L Eixample Gracia Sant Martí Les Corts Sants Montjuic Ciutat Vella Sant Martí Sant Andreu Nou Barris Horta Guinardó Pº de Gracia entre Gran Vía de Les Corts Catalanes y Av. Diagonal Travessera de Gracia Vía Augusta Av. Del Príncipe de Asturias Ronda del General Mitre Vía Augusta Clavet Travessera de Gracia. Travessera de Les Corts Gran Vía de Carles III Av. Madrid Av. Joseph Tarradellas Travessera de Les Corts. Pza. Francesc Macia C/ Comte d Urgell C/ Córcega C/ Muntaner C/ Valencia C/ Balmes Gran Vía de Les Corts Catalanes C/ Girona C/ Córcega Av. Diagonal Pza. Francesc Macia. Frente Marítimo del Pº de Colom y del Pº de Joan de Borbo Comte de Barcelona Barrio Gótico Gran Vía de Carles III Av. Madrid Ctra. Collblau Travessera de Les Corts Gran Vía de Les Corts. Pza. Francesc Macia Av. Joseph Tarradellas - Pza. Paisos Catalans C/ Tarragona Pza. España Gran Vía de Les Corts Catalanes Pza. Universitat C/ Pelai C/ Fontanella Ronda Sant Pere C/ Ribes C/ Marina Av. Diagonal C/ Girona Gran Vía de Les Corts Catalanes C/ Balmes C/ Valencia C/ Muntaner C/ Córcega C/ Comte d Urgell Pza. Francesc Macia Distrito Entero Pza. dels Voluntaris C/ La Marina Av. D Icaria C/ Taulat Diagonal Mar Ronda Litoral Pza. dels Voluntaris Resto del Distrito Distrito Entero El Raval, Ribera y La Barceloneta Distrito Entero salvo Frente Marítimo definido en A2 Distrito Entero Distrito Entero Distrito Entero 6
2. Geographic Distribution Below we detail the towns in the Metropolitan Area of Central Barcelona that are studied in this report. L Hospitalet de Llobregat Esplugues de Llobregat El Prat de Llobregat Santa Coloma de Gramanet Cornellà de Llobregat Badalona Sant Boi de Llobregat Cerdanyola del Vallès Viladecans Sant Cugat del Vallès These towns in the Metropolitan Area of the city were selected based on their proximity to Central Barcelona, real estate activity and the existing population as at the drafting of this report. In the study of both the different districts of Central Barcelona and the towns of the Metropolitan Area, any information relating to the surface area of properties, constructed sqm (sqm) relates to: (sqm) constructed area, excluding the proportional share of common areas. In developments which include a parking space and/or storage area in the final property price, we have deducted the corresponding amount from the apartment s retail price (the sales value of these elements if known, or an average for the area the properties are located in if not) to ensure that the pricing of apartments is uniform. Wehave not studied single-family homes in Barcelona, or in its Metropolitan Areas, as the lack of comparables and their diversity, could significantly distort the results. 7
2. Geographic Distribution As previously indicated, in order to ensure that the results of this report are as close to reality as possible, we have divided up the Central Barcelona market, as detailed in the lefthand map. In the Metropolitan Area, each area is studied individually, without further division. The towns analysed are shown in the right-hand map. Zoning map of the Central Barcelona residential market Location of the towns analysed in the Metropolitan Area 8 10 4 6 2 7 5 1 9 3 1. L Hospitalet de Llobregat 6. Badalona 2. Esplugues de Llobregat 7. Sant Boi de Llobregat 3. El Prat de Llobregat 8. Cerdanyola del Vallès 4. Santa Coloma de Gramanet 9. Viladecans 5. Cornellà de Llobregat 10. Sant Cugat del Vallès 8
Conclusions of the Study
3. Conclusions of the Study After completing this market study, we can conclude that activity in the residential market (new-build and open market) of Barcelona and its Metropolitan Areas has maintained the same pace set in 2014-15, defined by a slight increase in sales prices per sqm, an upswing in residential demand and developer activity, which despite trending upwards, is still not producing enough to satisfy current demand. Against this backdrop, average sales marketing periods stand at less than 24 months, and as a result, all units of most new residential projects have already been sold when their construction is completed. Finally, this year s study indicates that negotiating margins have narrowed significantly, after it bieng very much a buyer-ed market during credit crunch. The graphs below provide basic information on the residential market in Central Barcelona and the towns in its Metropolitan Areas that have been analysed. We will examine the data provided throughout this report and comment on specific characteristics and circumstances that we believe to be of most interest. DISTRITO Of Inicial Stock en unidades % Stock /Of Inicial Precio /m² Plazo Comercialización (meses) CIUTAT VELLA 70 31 44,3% 5.458 39,8 GRACIA 56 22 39,3% 4.699 19,1 HORTA GUINARDÓ 122 30 24,6% 3.286 18,7 L EIXAMPLE 230 48 20,9% 4.261 32,2 LES CORTS 140 15 10,7% 5.570 27,2 SANT ANDREU 64 10 15,6% 3.516 29,1 SANT MARTÍ 323 40 12,4% 3.529 18,6 SANTS-MONTJUÏC 267 95 35,6% 3.602 25,5 SARRIA-SANT GERVASI 149 38 25,5% 5.871 28,2 TOTAL 1.504 340 22,6% 4.280 22,6 MUNICIPIO Of Inicial Stock en unidades % Stock /Of Inicial Precio /m² Plazo Comercialización (meses) BADALONA 498 147 29,5% 2.059 32,2 CERDANYOLA DEL VALLÈS 14 14 100,0% 2.489 28,0 CORNELLA DE LLOBREGAT 196 13 6,6% 2.262 9,6 ESPLUGUES DE LLOBREGAT n.d n.d n.d n.d n.d L' HOSPITALET DE LLOBREGAT 295 73 24,7% 2.924 9,8 SANT CUGAT DEL VALLES 267 77 28,8% 3.304 6,9 SANT BOI DE LLOBREGAT 176 71 40,3% 2.422 13,5 SANTA COLOMA DE GRAMENET 48 37 77,1% 1.681 89,8 VILADECANS 102 29 28,4% 1.930 26,2 TOTAL 1.596 461 28,9% 2.409 13,0 10
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 3. Conclusions of the Study After completing our research fieldwork, activity in the Central Barcelona residential market over the period studied can be summarised with the following key points. The average price of an open-market home for sale in Central Barcelona has registered another increase over the last 12 months, of approximately 2%. An average apartment in Central Barcelona comprises 101 sqm, has an average price of 4,280 per sqm and an average final price of 432,972. In order to purchase an apartment, and considering a mortgage with an interest rate of 2.5%, the average buyer must pay a deposit of 86,594 and then make monthly mortgage payments of 1,554 for 25 years or 1,369 for 30 years. Sales marketing periods in Central Barcelona have remained stable, and have continued to fall in the towns analysed in its Metropolitan Areas. The average sales marketing period of a development in Central Barcelona (with an average of 27 apartments) is 22.6 months, compared to 22.1 months in 2015. New-build home sales fell during the first half of 2016, compared with the same period in 2015. This drop is not due to waning demand, but rather a lack of available new-build open-market supply. During the first half of 2016, 551 new-build homes were sold compared to 645 in 2015. Increasing development activity in Catalonia as a whole, particularly in the province of Barcelona, demonstrated by the rise in the number of new-build construction permits issued, which rose 7.4% in H1 2016 compared to H1 2015. A total of 27 new-build developments have come onto the market in Barcelona in recent months. The highest priced developments on the market were 8,500 to 10,000 per sqm in La Bonanova neighbourhood, within the Sarria-Sant Gervasí district, and 6,500 to 7,500 per sqm in l Eixample district. 14.000 12.000 10.000 8.000 6.000 4.000 2.000 0 7.000 6.000 5.000 4.000 3.000 2.000 1.000 0 10.473 10.406 1.767 1.888 NEW-BUILD AND EXISTING HOUSING SALES. CENTRAL BARCELONA (H1 2005-2016) 6.959 4.223 3.752 5.682 3.479 3.867 3.966 1.052 860 745 919 425 408 250 684 645 551 APARTMENT STARTS IN CENTRAL BARCELONA 5.542 6.076 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Vivienda libre nueva Vivienda segunda mano 7.730 Source: Spanish Development Ministry Source: Idescat 11
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 3. Conclusions of the Study The following conclusions refer to the 11 towns forming the Metropolitan Area of Barcelona which this report focuses on. One of the most important points to note is the extraordinary sales rates registered in the developments located in the main towns of the Metropolitan Area. Sales rates in the towns analysed have continued to decline, with an average of 13 months required to sell all the units in a development. This is causing an increasing number of new developments to come onto the market in towns in the Metropolitan Areas. In the Metropolitan Area, the average price per sqm for high rise apartments has grown by 1.1% to 2,409 per sqm, still a far cry from 2009 s peak of 3,687 per sqm. The average home area stands at 105 sqm, and the average home price is in the region of 254,013. A total of 21 developments have come onto the market in the Metropolitan Area of Barcelona. Over 50% of these developments are shared between Sant Cugat del Vallés, Badalona and Cornellá de Lobregat. New-build home sales in the towns analysed in the Metropolitan Area of Barcelona during H1 2016 increased by 8.5% y-o-y. A total of 328 new-build homes were sold in H1 2016 in the areas studied, versus 300 in H1 2015. As with Central Barcelona, the reduced activity levels seen in the new-build market compared to the existing housing market, is down to the lack of new-build supply on the market. Existing home sales climbed 9.5% in H1 2016 compared to H1 2015. 10.000 9.000 8.000 7.000 6.000 5.000 4.000 3.000 2.000 1.000 0 70.000 60.000 50.000 40.000 30.000 20.000 10.000 0 7.754 7.423 1.498 1.316 NEW-BUILD AND EXISTING HOUSING SALES BARCELONA METROPOLITAN AREA (H1 2005-2016) 5.360 2.371 1.883 2.885 880 1.116 948 972 1.769 1.742 281 390 154 333 300 328 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Vivienda libre nueva 1.788 Vivienda segunda mano 2.371 APARTMENT STARTS IN THE PROVINCE OF BARCELONA 3.226 4.006 Source: Spanish Development Ministry Source: Idescat 12
Forecasts 2016-2017
4. Forecasts 2016-2017 Below are forecasts for the Barcelona residential market and the main towns in its Metropolitan Area for the upcoming year. Generally speaking, over the next year, the trend started in 2015 will continue in terms of increasing price, sales performance, and new supply coming onto the market. In our view, sales marketing periods have reached a more than reasonable rate, and no further improvements are expected. Over the next 12 months, we expect average prices to increase by around 5% y-o-y, especially in the very best areas of Central Barcelona, listed as Prime and A1 in this report. This increase is due to higher levels of demand and the continued decline of available supply in these areas. In the remaining areas, where available supply is also decreasing, prices will be shaped by sales rates and the levels of existing supply. Increase in the sales volume of new-build open-market homes. The improved economic climate will continue to strengthen two key drivers of residential demand, job creation planned over the next two years, and an increase in household disposable income. This, along with favourable financing terms and conditions, will continue to bolster demand for homes. However, we must highlight that the key issue regarding job creation as far as the residential market (home purchases) is concerned is that the number of permanent contracts increase, as the number of temporary jobs created is virtually irrelevant for this sector. Sales rates for new projects will remain very positive, staying at levels reached during 2016. Sales marketing periods for new projects continue to shorten, with all units being sold whilst the development is still under construction or within a few months of its completion. The main driver of these high sales marketing rates is the fact that the new projects are being developed in areas where there is effective demand, accessible prices and a moderate supply. Construction activity will continue to grow at a steady pace thanks to solid demand and the low level of available stock in certain markets. The lion s share of new projects in the city centre continue to be full-scale refurbishments of buildings, in view of the lack of available land. International investment funds that traditionally invested in other types of real estate asset classes, will remain interested in acquiring plots of land to develop residential properties. Given their lack of expertise in the Spanish residential market, they usually join forces with local experts (mainly developers without sufficient financial backing). Many economic groups, particularly young people that are at the age of leaving home, are finding it particularly difficult to purchase properties, so they have had to turn to the rental market as a result. Nevertheless, interest in renting continues to be low compared to neighbouring countries and is more a consequence of the difficulty of acquiring a home than of a belief in the virtues of renting. 14
Central Barcelona
5. Central Barcelona Analysis of initial housing supply (Initial housing supply (or housing supply) refers to the total number of homes (apartments), whether already sold or not, forming part of the development projects being marketed in the area under analysis.) The following table details the initial housing supply in each of the four areas studied, in the Central Barcelona market (see point 2. Methodology and Geographic Distribution), as well as its comparison with total supply since 2010. ZONA 2010 2011 2012 2013 2014 2015 2016 PRIME 195 156 168 113 109 97 141 A1 422 376 451 616 277 255 233 A2 1.089 1.105 823 1.008 1.076 905 641 A3 1.358 1.152 861 727 340 494 489 TOTAL 3.064 2.789 2.303 2.464 1.802 1.751 1.504 Distribution of the initial housing supply by zones A3 32,5% PRIME 9,4% The initial housing supply fell by 14.1% due to the completion of sales of a significant amount of projects over the past 12 months. Some of those projects had been on the market for years, with remainder of the available homes being sold in the last few months. A1 15,5% Furthermore, the new schemes that have come onto the market in the last 12 months have been largely small developments that have not significantly impacted the amount of new build supply. As the graph to the left indicates, and as is usually the case, the A-2 and A-3 are the areas where the majority of the initial supply is found, accounting for 75.1% of the total. This is due to the greater development potential gained by having more available land. A2 42,6% 16
5. Central Barcelona Analysis of property sizes and average prices of properties on the market All of the figures indicated below refer to existing supply for sale when the field research for this report was completed (1 December 2016). Therefore, they do not refer to the price that properties could have been sold at over 2016, but rather the price of the properties on the market at the date of our fieldwork. ZONA Sup y Precios 2010 2011 2012 2013 2014 2015 2016 PRIME A1 A2 A3 MEDIA Var 2015-2016 Sup media (m²) 128 123 123 162 113 144 164 13,7% Precio medio (euro/m²) 7.314 6.651 6.516 6.516 6.043 7.553 7.946 5,2% Precio medio vivienda 933.770 816.340 803.392 1.052.794 680.816 1.089.749 1.303.085 19,6% Sup media (m²) 95 125 109 94 84 92 103 12,3% Precio medio (euro/m²) 6.767 5.188 6.445 4.398 4.347 5.241 5.327 1,6% Precio medio vivienda 646.067 649.162 701.791 412.535 363.682 481.152 549.367 14,2% Sup media (m²) 86 91 86 91 85 102 103 1,4% Precio medio (euro/m²) 5.581 4.110 4.116 3.855 3.826 4.163 4.136-0,7% Precio medio vivienda 479.110 374.154 354.073 350.755 323.940 424.025 427.196 0,7% Sup media (m²) 82 86 86 88 82 86 93 8,7% Precio medio (euro/m²) 4.207 3.600 3.184 3.049 3.185 3.358 3.455 2,9% Precio medio vivienda 346.390 309.581 275.111 267.843 262.074 287.466 321.523 11,8% Sup media (m²) 88 92 90 96 86 96 101 5,1% Precio medio (euro/m²) 5.140 4.167 4.155 4.088 4.036 4.194 4.280 2,0% Precio medio vivienda 451.318 384.774 375.027 391.905 346.700 403.845 432.972 7,2% Over the past 12 months the price per sqm of housing for sale in Barcelona has continued to increase (2%) going from 4,194 per sqm in 2015 to 4,280 per sqm in the period analysed. The average price per sqm of apartments in the most exclusive area of the city, the prime area, increased by 5.2% during the past year, reaching 7,946 per sqm. The average price per sqm has increased in all areas except in the A2, where it fell by 0.7%. However, the price in this area has remained above the levels registered in 2011-2014. 17
5. Central Barcelona Analysis of property sizes and average prices of properties on the market DISTRITO Sup y Precios 2010 2011 2012 2013 2014 2015 2016 Var 2015-2016 Sup media (m²) 76 83 93 90 81 88 96 9,4% CIUTAT VELLA Precio medio (euro/m²) 5.622 4.838 3.961 3.575 6.472 5.286 5.458 3,3% Precio medio vivienda 429.167 399.333 370.000 320.893 525.761 464.847 525.313 13,0% Sup media (m²) 79 87 87 91 95 99 114 14,5% GRACIA Precio medio (euro/m²) 5.029 4.088 4.268 3.867 3.380 3.967 4.699 18,4% Precio medio vivienda 398.918 355.566 369.968 353.730 319.432 394.693 535.091 35,6% Sup media (m²) 73 85 85 88 89 98 96-2,5% HORTA GUINARDÓ Precio medio (euro/m²) 4.863 3.717 3.361 2.833 2.807 3.448 3.286-4,7% Precio medio vivienda 357.342 314.703 286.426 250.096 248.952 337.876 313.980-7,1% Sup media (m²) 85 89 81 81 70 107 113 5,1% L EIXAMPLE Precio medio (euro/m²) 6.359 5.373 5.816 5.190 5.500 4.254 4.261 0,1% Precio medio vivienda 539.861 480.574 471.410 418.569 384.736 456.140 480.073 5,2% Sup media (m²) 93 95 96 81 83 93 91-1,8% LES CORTS Precio medio (euro/m²) 6.216 3.603 3.378 4.014 3.836 3.882 5.570 43,5% Precio medio vivienda 577.621 341.860 323.850 326.587 319.583 360.757 508.456 40,9% Sup media (m²) 84 81 80 83 n.d. 66 82 24,2% NOU BARRIS Precio medio (euro/m²) 3.331 3.030 2.735 2.800 n.d. 3.232 2.817-12,8% Precio medio vivienda 280.408 245.852 219.413 233.327 n.d. 212.667 230.236 8,3% Sup media (m²) 78 76 74 74 79 94 89-5,7% SANT ANDREU Precio medio (euro/m²) 4.469 3.755 3.630 3.680 3.154 3.099 3.516 13,4% Precio medio vivienda 348.694 284.533 268.387 271.509 249.060 292.250 312.567 7,0% Sup media (m²) 90 92 82 111 93 93 98 5,0% SANT MARTÍ Precio medio (euro/m²) 4.281 3.579 3.543 2.718 3.060 4.767 3.529-26,0% Precio medio vivienda 385.213 327.904 289.246 301.236 283.901 444.746 345.675-22,3% Sup media (m²) 94 92 91 97 81 88 93 5,7% SANTS-MONTJUÏC Precio medio (euro/m²) 3.746 3.736 3.238 3.358 3.634 3.495 3.602 3,1% Precio medio vivienda 351.933 342.171 295.052 326.962 293.780 307.116 334.647 9,0% Sup media (m²) 171 179 136 148 163 146 125-14,6% SARRIA-SANT GERVASI Precio medio (euro/m²) 7.917 6.199 7.048 6.537 6.277 7.229 5.871-18,8% Precio medio vivienda 1.351.325 1.111.288 956.878 965.652 1.022.113 1.054.707 731.244-30,7% Sup media (m²) 88 92 90 96 86 96 101 5,1% MEDIA Precio medio (euro/m²) 5.140 4.167 4.155 4.088 4.036 4.194 4.280 2,0% Precio medio vivienda 451.318 384.774 375.027 391.905 346.700 403.845 432.972 7,2% Once again, Sarriá-Sant Gervasí is the district to register the highest prices, 5,871 per sqm, despite an y-o-y decline of 18.8%. This drop is due to the fact that 65% of available housing supply on the market belongs to two projects where the prices are below the district average. The remainder of developments in the district have an average price of 7,672 per sqm. The Ciutat Vella district comes in second, with an average unit price of 5,458 per sqm, up 3.3% y-o-y. Nou Barris is the district with the most affordable average price, standing at 2,817 per sqm in 2016. 18
5. Central Barcelona Parking spaces and storage units The following two graphs detail the average prices of both parking spaces and storage units by area and their comparison with the figures for 2014, 2015 and 2016. Average Parking Space Price ( ) Average Storage Space Price ( ) Parking and storage unit sales prices have remained stable in all of the areas analysed. Prices for parking spaces range between 50,000 per parking space in the most exclusive areas of Barcelona to 21,333 per parking space in less prime areas. Prices for storage units remain between 8,500 per unit in more expensive areas to 4,889 per unit in the most affordable areas. 19
5. Central Barcelona Analysis of marketing of existing supply Stock of homes refers to the total number of homes (apartments) available for purchase, i.e. not sold off-plan or sold. DISTRITO Stock en unidades % Stock Of Inicial % Of Inicial % Stock /Of Inicial CIUTAT VELLA 31 9,1% 70 4,7% 44,3% GRACIA 22 6,5% 56 3,7% 39,3% HORTA GUINARDÓ 30 8,8% 122 8,1% 24,6% L EIXAMPLE 48 14,1% 230 15,3% 20,9% LES CORTS 15 4,4% 140 9,3% 10,7% SANT ANDREU 10 2,9% 64 4,3% 15,6% SANT MARTÍ 40 11,8% 323 21,5% 12,4% SANTS-MONTJUÏC 95 27,9% 267 17,8% 35,6% SARRIA-SANT GERVASI 38 11,2% 149 9,9% 25,5% TOTAL 340 100,0% 1.504 100,0% 22,6% Initial housing supply stands at 1,504 homes of which a total of 340 homes (22.6%) are available for purchase. The districts of Sants Montjuïc and L Eixample feature the highest housing supply, with 95 and 48 homes respectively, owing to the fact that these are the two districts to have the most new projects on the market. The districts of Sants Montjuïc and Ciutat Vella have the highest percentages of available stock, compared to initial housing supply. Finally, we would highlight that Sant Andreu and Les Corts are the districts with the lowest housing supply on the market, with 10 and 15 available homes respectively at the time of carrying out this study. 20
5. Central Barcelona Sales rate and average sales period for developments The sales period refers to the time required to market an entire medium-sized housing development at existing sales rates (number of homes sold since the beginning of the construction of the development, up until the date this report was completed). Sales rate refers to the percentage of a housing development that is sold each month. The following graph was obtained by analysing the sales rates in Barcelona in 2016 and the same figure in previous years from 2010. During the period analysed, sales marketing rates have held firm owing to the fact that the projects which are currently coming onto the market do so with very high pre-sales, are located in areas where demand is evident, and are being sold at market prices. Sales Periods DISTRITO % Vendido/mes Plazo Comercialización 2010 2011 2012 2013 2014 2015 2016 2010 2011 2012 2013 2014 2015 2016 CIUTAT VELLA 2,9% 2,3% 1,9% 1,5% 0,9% 3,6% 2,5% 34,6 43,5 52,2 66,4 108,8 28,1 39,8 GRACIA 1,6% 1,1% 1,4% 1,0% 1,4% 1,1% 5,2% 61,9 91,7 73,8 95,3 71,9 90,6 19,1 HORTA GUINARDÓ 1,2% 1,2% 1,3% 2,3% 1,0% 3,2% 5,3% 83,9 85,3 74,6 43,3 102,5 30,9 18,7 L EIXAMPLE 1,8% 1,5% 1,3% 1,6% 83,4% 11,4% 3,1% 55,2 65,9 78,9 63,9 1,2 8,8 32,2 LES CORTS 1,8% 1,9% 1,9% 1,9% 2,1% 1,8% 3,7% 57,1 52,6 52,6 52,6 47,9 55,5 27,2 NOU BARRIS 1,5% 1,8% 1,5% 1,2% n.d. n.d. 9,5% 65,4 55,1 66,1 82,3 n.d. n.d. 10,6 SANT ANDREU 1,8% 1,5% 1,5% 1,5% 2,4% 10,6% 3,4% 54,7 68,3 64,8 64,6 42,4 9,4 29,1 SANT MARTÍ 1,7% 1,4% 1,4% 3,9% 2,6% 2,9% 5,4% 58,4 72,6 71,8 25,8 38,5 34,6 18,6 SANTS-MONTJUÏC 1,6% 1,3% 1,0% 1,0% 0,7% 2,9% 3,9% 62,3 78,2 100,8 102,8 143,8 35,1 25,5 SARRIA-SANT GERVASI 1,2% 1,0% 0,8% 1,1% 2,1% 1,9% 3,5% 82,6 96,2 120,8 87,2 48,1 52,2 28,2 Total 1,8% 1,5% 1,3% 1,5% 1,7% 4,5% 4,4% 55,8 66,7 74,4 66,7 58,8 22,1 22,6 21
5. Central Barcelona Financing of property purchases Taking into consideration average prices and average home sizes in each district, along with a mortgage with a 2.5% interest rate and amortisation terms of both 25 and 30 years, a simple calculation has been made in order to draw up the following table, in which we show estimates of the amount that a buyer would have to commit, in order to purchase an open market new-build home. We would also point out that we have not taken into consideration either VAT or purchase costs to be paid by the buyer when compiling these figures. The following tables detail the monthly cost both for a term of 25 years and 30 years in order to purchase an average apartment in Central Barcelona. Data is provided both by zones, as well as by districts. DISTRICT Average area (sqm built) Average apartment price Entrance Mortgage Monthly Monthly cuota (25 cuota (30 years) years) CIUTAT VELLA 96 525,313 105,063 420,250 1,885 1,660 GRACIA 114 535,091 107,018 428,073 1,920 1,691 HORTA GUINARDÓ 96 313,980 62,796 251,184 1,127 992 L EIXAMPLE 113 480,073 96,015 384,059 1,723 1,517 LES CORTS 91 508,456 101,691 406,765 1,825 1,607 NOU BARRIS 82 230,236 46,047 184,189 826 728 SANT ANDREU 89 312,567 62,513 250,054 1,122 988 SNT MARTÍ 98 345,675 69,135 276,540 1,241 1,093 SANTS-MONTJUÏC 93 334,647 66,929 267,717 1,201 1,058 SARRIA-SANT GERVASI 125 731,244 146,249 584,995 2,624 2,311 TOTAL 101 432,972 86,594 346,377 1,554 1,369 AREA Average area (sqm built) Average apartment price Entrance Mortgage Monthly Monthly cuota (25 cuota (30 years) years) PRIME 164 1,303,085 260,617 1,042,468 4,677 4,119 A1 103 549,367 109,873 439,494 1,972 1,737 A2 103 427,196 85,439 341,757 1,533 1.350 A3 93 321,523 64,305 257,219 1,154 1,016 TOTAL 101 432,972 86,594 346,377 1,554 1,369 The increase in prices has meant that the monthly mortgage payment for an average sized property in the city of Barcelona currently stands at 1,554 for a 25 year mortgage term or 1,369 for a 30 year mortgage term. 22
Barcelona Metropolitan Area
6. Barcelona Metropolitan Area Analysis of initial housing supply (Initial housing supply (or housing supply) refers to the total number of homes, whether already sold or not, forming part of those development projects being marketed in the subject area.) The following table details the initial housing supply in each of the towns detailed in the study, as well as the change since 2009. MUNICIPIO 2009 2011 2012 2013 2014 2015 2016 2017 BADALONA 676 226 512 698 662 425 514 498 CERDANYOLA DEL VALLÈS 168 67 79 105 68-16 14 CORNELLA DE LLOBREGAT 339 271 298 492 486 342 342 196 ESPLUGUES DE LLOBREGAT 108 50 38 265 252 113 119 - L' HOSPITALET DE LLOBREGAT 1.200 780 745 820 357 566 657 295 SANT CUGAT DEL VALLES 1.214 872 1.087 981 570 366 248 267 SANT BOI DE LLOBREGAT 110 56 42 198 150 143 143 176 SANTA COLOMA DE GRAMENET 92 27 61 46 76 22 22 48 VILADECANS 341 199 212 242 195 709 656 102 TOTAL 4.331 2.593 3.099 3.890 2.859 2.764 2.717 1.596 Percentage distribution of the initial housing supply by Towns 17% 11% 3% 6% BADALONA CERDANYOLA DEL VALLÈS 31% CORNELLA DE LLOBREGAT L' HOSPITALET DE LLOBREGAT SANT CUGAT DEL VALLES 1% SANT BOI DE LLOBREGAT During 2016, initial supply in Barcelona's Metropolitan Area has fallen sharply (41.3%) compared to 2015. This marked decrease is due to the completion of sales of two developments over the past 12 months, which between them amounted to a combined initial supply of almost 900 homes. The new projects that have now come on to the market also comprise fewer homes than in 2015. During 2016, the towns with the highest initial supply are Baldona, L'Hospitalet de Llobregat and Sant Cugat del Vallés. Supply in these three areas amounts to 66% of the total initial supply figure. 12% SANTA COLOMA DE GRAMENET 19% 0% VILADECANS 24
6. Barcelona and its Metropolitan Area Analysis of property sizes and average prices of properties on the market All of the figures indicated below refer to existing supply for sale when the field research for this report was completed (1 December 2016). Therefore, they do not refer to the price that homes could have been sold for over the past 12 months, but rather the price that properties on the market had at that date. MUNICIPIO Sup y Precios 2010 2011 2012 2013 2014 2015 2016 Var 15-16 BADALONA CERDANYOLA DEL VALLÈS CORNELLA DE LLOBREGAT EL PRAT DE LLOBREGAT ESPLUGUES DE LLOBREGAT L' HOSPITALET DE LLOBREGAT SANT CUGAT DEL VALLES SANT BOI DE LLOBREGAT SANTA COLOMA DE GRAMENET VILADECANS MEDIA Sup media (m²) 87 104 97 116 97 101 119 17,6% Precio medio (euro/m²) 3.906 2.654 2.273 1.994 2.353 2.378 2.059-13,4% Precio medio vivienda 340.314 275.890 220.064 231.296 227.646 240.002 244.486 1,9% Sup media (m²) 116 124 126 141 n.d 82 101 23,5% Precio medio (euro/m²) 2.834 2.907 2.741 2.943 n.d 2.335 2.489 6,6% Precio medio vivienda 328.641 359.547 344.189 415.000 n.d 191.500 252.143 31,7% Sup media (m²) 95 95 95 92 74 97 116 20,0% Precio medio (euro/m²) 3.413 3.194 2.945 2.416 2.662 2.578 2.262-12,2% Precio medio vivienda 323.928 304.435 279.119 222.619 197.842 249.908 263.308 5,4% Sup media (m²) 92 98 99 n.d n.d n.d n.d n.d Precio medio (euro/m²) 3.093 2.818 2.686 n.d n.d n.d n.d n.d Precio medio vivienda 283.612 275.935 265.941 n.d n.d n.d n.d n.d Sup media (m²) 119 94 91 98 71 90 n.d n.d Precio medio (euro/m²) 3.933 3.960 3.750 3.327 2.863 2.992 n.d n.d Precio medio vivienda 469.167 370.432 339.813 325.673 202.256 269.233 n.d n.d Sup media (m²) 92 96 79 76 83 94 85-9,5% Precio medio (euro/m²) 4.133 4.198 2.944 2.791 3.257 2.628 2.924 11,3% Precio medio vivienda 378.218 400.958 233.383 212.443 270.304 247.431 249.277 0,7% Sup media (m²) 110 107 103 95 96 110 101-8,7% Precio medio (euro/m²) 3.494 3.254 3.163 2.954 3.013 2.798 3.304 18,1% Precio medio vivienda 382.851 348.048 325.653 281.126 290.025 308.764 332.706 7,8% Sup media (m²) 94 90 85 78 93 93 109 17,4% Precio medio (euro/m²) 2.933 3.034 2.567 2.413 2.007 1.647 2.422 47,1% Precio medio vivienda 275.052 272.133 218.550 188.815 185.818 153.207 264.585 72,7% Sup media (m²) 84 91 89 90 65 83 100 21,2% Precio medio (euro/m²) 3.299 3.043 3.289 2.687 1.686 1.124 1.681 49,6% Precio medio vivienda 275.818 277.133 292.899 242.663 110.191 92.932 168.395 81,2% Sup media (m²) 100 79 88 95 92 79 96 21,8% Precio medio (euro/m²) 2.917 4.067 3.028 2.306 2.473 2.264 1.930-14,8% Precio medio vivienda 291.097 320.455 267.392 219.942 226.289 178.605 185.376 3,8% Sup media (m²) 98 99 95 99 89 98 105 7,6% Precio medio (euro/m²) 3.635 3.230 2.822 2.419 2.619 2.383 2.409 1,1% Precio medio vivienda 355.531 320.809 267.662 238.417 233.879 233.549 254.013 8,8% 25
BADALONA CERDANYOLA DEL VALLÈS CORNELLA DE LLOBREGAT EL PRAT DE LLOBREGAT ESPLUGUES DE LLOBREGAT L' HOSPITALET DE LLOBREGAT SANT CUGAT DEL VALLES SANT BOI DE LLOBREGAT BADALONA CERDANYOLA DEL VALLÈS CORNELLA DE LLOBREGAT EL PRAT DE LLOBREGAT ESPLUGUES DE LLOBREGAT 3.000 3.000 12.000 16.500 16.000 14.775 17.600 16.000 15.000 18.000 17.333 15.400 16.000 14.000 4.159 4.000 4.000 4.000 3.600 4.200 20.320 20.234 20.346 18.000 19.250 5.522 5.000 5.500 20.000 20.000 6.148 6.750 25.000 25.000 25.000 6. Barcelona Metropolitan Area Parking spaces and storage units The following two graphs detail the average prices of both parking spaces and storage units by towns and their comparison with the figures for 2014 and 2015. 2014 2015 2016 2014 2015 2016 30.000 25.000 8.000 7.000 20.000 6.000 15.000 5.000 4.000 10.000 3.000 5.000 2.000 1.000 0 0 Parking space and storage room prices have not varied a great deal compared to last year. The towns with the highest parking space prices again this year are Badalona and L Hospitalet de Llobregat, with an average price of more than 20,000 per space, whilst Sant Boi de Llobregat is the town with the lowest average price at 14,000 per space. Storage room prices have increased slightly, standing at around 3,600-6,200/storage room. 26
6. Barcelona Metropolitan Area Analysis of sale of existing supply Housing stock refers to the total number of homes (apartments) available for sale, i.e. not sold off-plan or sold. TOWN Stock in units % Stock Initial Supply % Initial Supply % Stock / Initial Supply BADALONA 147 31.9% 498 31.2% 29.5% CERDANYOLA DEL VALLÈS 14 3.0% 14 0.9% 100.0% CORNELLA DE LLOBREGAT 13 2.8% 196 12.3% 6.6% L' HOSPITALET DE LLOBREGAT 73 15.8% 295 18.5% 24.7% SANT CUGAT DEL VALLES 77 16.7% 267 16.7% 28.8% SANT BOI DE LLOBREGAT 71 15.4% 176 11.0% 40.3% SANTA COLOMA DE GRAMENET 37 8.0% 48 3.0% 77.1% VILADECANS 29 6.3% 102 6.4% 28.4% TOTAL 461 100.0% 1,596 100.0% 28.9% Initial housing supply stands at 1,596 homes of which a total of 461 homes (28.9%) are available for purchase. The towns with the lowest levels of stock are Cornellá de Llobregat and Cerdanyola del Vallès. The highest levels of stock in Barcelona's Metropolitan Area are in the towns of Badalona, Sant Cugat del Vallés and L Hospitalet de Llobregat. The town of Cerdanyola del Vallès has the highest percentage of available stock compared to initial housing supply, given that there is only one development under construction, meaning there are very few comparables in the market. 27
6. Barcelona Metropolitan Area Sales rate and average sales period for developments The sales period refers to the time needed to market an entire medium-sized housing development at existing sales rates (number of homes sold since the beginning of the construction of the development, up until the date this report was completed). Sales rate refers to the percentage of a housing development that is sold each month. The following graph was obtained by analysing the sales rates in the towns in Barcelona's Metropolitan Area in September 2016 and the same figure in previous years from 2010. One can see that sales periods have continued to decrease compared to previous years. 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% 64,7 50,6 77,8 4,2% 43,3 23,9 2,3% 2,0% 1,5% 1,3% 2011 2012 2013 2014 2015 2016 % Vendido/mes Plazo Comercialización 7,7% 90 80 70 60 50 40 30 20 13,0 10 MUNICIPIO % Vendido/mes Plazo Comercialización 2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 BADALONA 1,2% 3,0% 1,3% 3,1% 4,9% 3,1% 83,33 32,84 78,00 31,90 20,30 32,2 CERDANYOLA DEL VALLÈS 1,5% 1,5% 0,6% n.d. 0,9% 3,6% 66,67 66,88 162,60 n.d. 107,89 28,0 CORNELLA DE LLOBREGAT 2,0% 1,6% 1,2% 1,7% 1,4% 10,4% 50,00 63,49 81,00 57,60 71,91 9,6 EL PRAT DE LLOBREGAT 1,3% 1,1% n.d. 13,9% n.d. n.d. 76,92 92,64 n.d. n.d. n.d n.d ESPLUGUES DE LLOBREGAT 1,8% 1,4% 1,4% 1,1% 3,1% n.d. 55,56 70,59 72,20 91,80 31,86 n.d L' HOSPITALET DE LLOBREGAT 1,4% 3,0% 1,5% 2,1% 4,2% 10,2% 71,43 33,74 68,40 47,90 24,07 9,8 SANT CUGAT DEL VALLES 1,5% 1,3% 1,3% 2,0% 14,9% 14,6% 66,67 75,08 79,20 50,30 6,69 6,9 SANT BOI DE LLOBREGAT 2,1% 1,6% 1,5% 2,3% 4,3% 7,4% 47,62 61,03 66,80 43,50 23,20 13,5 SANTA COLOMA DE GRAMENET 1,6% 1,4% 1,2% 1,0% 0,9% 1,1% 62,50 71,62 83,50 98,50 111,04 89,8 VILADECANS 1,5% 1,2% 0,9% 1,7% 1,4% 3,8% 66,67 80,21 106,50 59,90 72,18 26,2 TOTAL 1,5% 2,0% 1,3% 2,3% 4,2% 7,7% 64,70 50,62 77,80 43,30 23,89 13,0 28
6. Barcelona Metropolitan Area Financing of property purchases Taking into consideration average prices and average home sizes in each town, along with a mortgage with a 2.5% interest rate and amortisation terms of both 25 and 30 years, a simple calculation has been made in order to draw up the following table, in which we show estimates of the amount that a buyer would have to commit, in each town in Barcelona, in order to purchase an open market new-build home. We would also point out that we have not taken in to account VAT or purchase costs to be paid by the buyer when compiling these figures. MUNICIPIO Sup. media (m²c) Precio medio vivienda Entrada Hipoteca Cuota mensual (25 años) Cuota mensual (30 años) BADALONA 119 244.486 48.897 195.589 928 825 CERDANYOLA DEL VALLÈS 101 252.143 50.429 201.714 957 850 CORNELLA DE LLOBREGAT 116 263.308 52.662 210.646 999 888 L' HOSPITALET DE LLOBREGAT 85 249.277 49.855 199.421 946 841 SANT CUGAT DEL VALLES 101 332.706 66.541 266.165 1.262 1.122 SANT BOI DE LLOBREGAT 109 264.585 52.917 211.668 1.004 892 SANTA COLOMA DE GRAMENET 100 168.395 33.679 134.716 639 568 VILADECANS 96 185.376 37.075 148.301 703 625 TOTAL 105 254.013 50.803 203.211 964 857 The increase in prices per sqm means that the monthly mortgage payment for an average-sized property in Barcelona's Metropolitan Area currently stands at 964 for a 25- year term. The monthly mortgage payment for an average sized property on a 30-year term currently stands at 857. 29
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