The weekend edition of the Financial Times dated April 7/8 featured a story in the House and Home section under the title ‘Barcelona hits the Brakes.’ The story describes the negative effect of last October’s Catalan independence referendum on Barcelona’s real estate market. The Times cites data from the Spanish property website Idealista. During the summer of 2017 (Q3 2017) properties in the city gained an impressive 018 percent compared to the previous year. In Q4 2017, in the midst of uncertainty stemming from the referendum, the prices fell 1.2 percent, with the sharpest drop taking place in the priciest neighborhoods.
The most interesting nugget of the story reads like this:
Foreign buyers’ sensitivity to Catalonia’s uncertainty political situation bode ill for the city’s property market in the mid-term since they form an increasing share of the market. Years of steady appreciation has meant that much of the city’s stock has become too expensive for locals. Salaries have been stagnant says Encinar (founder of Idealista). ‘Today, when you ask local agents about business, they talk to you about ‘investors’ rather than ‘clients.’
Meanwhile in February the British Columbia Finance Minister Carole James announced measures targeting foreign buyers and speculators. Foreigners now have to pay a 20 percent tax on top of the listing value (up from 15 percent), and a levy on property speculators will be introduced later this year. Starting…