March 8, 2021

Home sales plummets 17.7% in 2020, its biggest drop in nine years


MADRID

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Home sales plummeted 17.7% in 2020 compared to the previous year, to a total of 415,748 operations, registering its biggest drop in nine years and the lowest number of transactions since 2016, as reported by the National Institute on Monday of Statistics (INE).

With this annual drop, the sale of homes has led to two consecutive years of setbacks, although 2020, affected by the pandemic, has been much higher than that experienced in 2019 (2.4%). Between 2014 and 2018, merchantings of homes registered annual increases: 2% in 2014, 11.5% in 2015, 14% in 2016, 15.4% in 2017 and 10.8% in 2018.

In the period of the financial crisis, the worst years for housing transactions were 2009 and 2008, in which these operations collapsed 25.1% and 28.8%, respectively. In 2012 and 2011, there were still double-digit decreases (-11.5% and -18.1%), while in 2013 the drop moderated to 1.9% due to the end of tax benefits for the acquisition of housing.

The decline in home sales in 2020 was due to the contraction experienced both in second-hand flats and new homes.

Specifically, the sale of used homes fell by 19.2% last year, its biggest drop in eleven years, to add 333,205 operations, while the transactions carried out on new apartments fell by 11.2%, to 82,543 operations . It is the first decline experienced by sales of new homes after three consecutive years of progress and the sharpest since 2015.

91% of the homes transmitted by sale during the past year were free homes and 9%, protected. In total, the sale of free homes fell 17.3% in 2020, to 378,516 transactions, while the sale of protected homes fell by 22.4%, to 37,232 transactions.

In 2020, the highest number of house sales per 100,000 inhabitants occurred in the Valencian Community (1,469), La Rioja (1,306) and Murcia (1,258).

Andalusia was the region that carried out the most housing operations last year, with 83,760 purchases, followed by Catalonia (65,064), the Valencian Community (58,745) and Madrid (56,723). The communities that carried out the least number of home sales were La Rioja (3,244), Navarra (4,518 operations) and Cantabria (5,659).

In relative values, the sale of homes fell in 2020 in all communities, especially in the most touristy ones. Thus, the greatest setbacks occurred in the Balearic Islands (-23.2%), Comunidad Valenciana (-22.1%) and the Canary Islands (-21.9%), while the smallest were recorded in Extremadura (-6.5% ) and Asturias (-9%).

The INE recalls that, due to the pandemic, in 2020 there was a disparate evolution in the sale of homes in the different periods of the year. During the state of alarm, when the opening to the public of the Property Registries was suspended, there was a significant collapse in home sales, the most pronounced in May (-53.7%). After the confinement, the sale of houses began a “progressive recovery”.

Rebound in December

In the last month of 2020, the sale of homes grew by 3.7% in relation to December 2019, its highest year-on-year advance since July 2019, to add 36,109 operations. With this upturn, two consecutive months of year-on-year increases have already accumulated.

In a month-on-month rate (December 2020 over November of the same year), the sale of homes fell by 8.9%, its lowest decline in this month since 2015.

From the real estate portal flats.com, its Director of Studies, Ferran Font, highlights that “according to these data the change in trend in the sector is consolidated and for the second consecutive month the number of operations grows year-on-year”. “The more than 36,000 transmissions at the end of the month mean December with the highest figure since the period of the housing bubble and we have to go back to the middle of last year to find similar growth. The monthly figures contrast with the accumulated activity throughout the year that has received the terrible impact of Covid-19. Finally, 2020 has closed with a fall of 17.7%, the highest since 2011, and a figure of 415,748 operations that is at the levels of 2016 “, underlines the expert.

“Used housing, which has clearly led this statistic throughout the year, loses the 400,000 transactions signed in the last two years and, with just over 333,000 signatures, it falls above 19% year-on-year. On the other hand, new construction is below the figure of 92,000 operations registered in the last two years and, with just over 82,000, it falls by 11%, “adds Font.

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