“Opportunity to invest”: funds and savers take over the housing market

"Apartment rented until 2025. Opportunity to invest." "Excellent investment as a tourist apartment." «Property in judicial process. For investors only. These are some of the taglines that accompany hundreds of housing advertisements posted on portals such as Idealista or Fotocasa. Ads that do not target regular buyers or renters, but appeal directly to investors. Housing has become a refuge value where assets take refuge from the wave of inflation. To begin with, investment funds have doubled down on the brick, especially since it offers much higher returns than alternative investments. A trend that has accelerated in recent months and that now, in theory, will soften with the rise in interest rates undertaken by the European Central Bank. According to data from the Bank of Spain, the return on housing (which is based on rent plus price variation) stood at 10% in 2021. A yield that almost doubles that obtained in 2020, of 5.2%, and that is explained by the rise in the price of owned housing registered last year. Alternatives such as ten-year government bonds (0.5%), household deposits (0.3%) or even the Ibex 35 (7.9%) are far from the brick. In the real estate sector they also recognize the attractiveness of flats as an investment. According to the latest Fotocasa study, real estate offered a return of 6.9% during the first half of the year. One point more than five years ago, when he was already beginning to attract the attention of the big funds. In regions such as Murcia, the return offered by buying a home and then renting it has doubled since the housing bubble. Desktop code Image for mobile, amp and app Mobile code AMP code 2320 APP code The director of Fotocasa's research service, María Matos, highlights in statements to this newspaper that "the yields of the real estate sector are difficult to match by other assets". In her opinion, investment in housing is no longer limited exclusively to investment funds, but "increasingly attracts more individuals." “During the pandemic, many individuals accumulated savings that they are now using to invest in housing. It is a phenomenon that is being strongly noticed this year and that we had not seen before, "says Matos. Related News standard No The communities where it is more profitable to buy to rent ABC The gross return on housing reached 6.36% during the second quarter of the year Idealista sources abound in this idea. Although they recognize that "the current scenario is one of great uncertainty" and that the rise in interest rates, and the consequent increase in the cost of financing, should have a direct impact on the number of purchases and the granting of mortgages, they also recognize that "the effect of inflation could push many small and medium-sized savers to bet on investment in bricks in the face of the instability currently offered by the Stock Market and other more volatile products». "We do not have data on which of the two factors will prevail over the other, which increases the prevailing uncertainty," they add from the portal. Regarding the volume of advertisements aimed at investors that are posted on Idealista, these same sources assure that it is "impossible to calculate." The impact on prices What impact does this investment fever have on rental prices? Organizations such as the Tenants' Union assure that this factor fully explains the complex access to housing that currently prevails. Above all, due to the acquisitions carried out in recent years by different investment funds. A radically different vision than the one possessed by real estate portals. From Fotocasa they assure that the segment to which investors go is not the same as that of individuals. Although they do recognize that the investment may have "some impact" on the rental price on certain occasions. The deputy general manager of Don Piso, Emiliano Bermúdez, goes a step further and completely rules out that investors have an impact on housing prices. «Investors used to speculate, but now they add value through improvements and reforms in the property. This interest encourages the release of new properties to the market”, says Bermúdez. Don Piso, like the rest of the real estate agencies, blames the rise in rental and sale prices on the lack of supply. This shortage has worsened in recent months due to the slow release of housing developments on the market and the regulatory fluctuations, according to the real estate companies. Fewer houses in a market to which, in addition to families and funds, small savers are also flocking.

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