José María Álvarez: «The recovery of the real estate development industry is a fact»

"The data is overwhelming. Last year it closed with more than 450,000 transactions carried out and for this year it is expected to reach or exceed half a million operations ”.

Present past and future. They are the coordinates that any analyst usually manages when presenting his conclusions. Mine, now that we have already passed the quarter century as a real estate witness, are also based on these existential parameters. A real estate business that is key in the economy of civilized countries. And an industry that mobilizes billions of Eurodollars in the United States, the European Union and all of Asia. Every day, thousands of square meters of office buildings, stores and shopping malls, parks and industrial parks, lots and, of course, apartments are bought and sold.

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We are at the culmination of an arduous and long process of recovery

If we talk about the present in Spain, the first conclusion that must be put on the table is that the recovery of the real estate development industry is a fact . So much so that in the first half of the year a company in the industry, Neinor Homes, just went public. In addition, the possible exit of two other promoter companies to the Spanish market is already announced in the immediate post-summer panorama. This important news is, without a doubt, the culmination of an arduous and long process of recovery in the sector that began in September 2013 approximately and could be terminated this year.

In these last three years, housing has become a major player in the economy. The data is overwhelming. Last year it closed with more than 450,000 transactions carried out and for this year it is expected to reach or exceed half a million operations . It is true that it is necessary to differentiate between new and used work, and that second-hand has accounted for almost 80% of all operations. A fact that shows us that citizens want to return to live in the downtown neighborhoods of cities and not twenty kilometers or more.

The same mistakes could be made as in the past

All the major markets of the Spanish residential, that is, Barcelona, Madrid and the Mediterranean coast, with Malaga at the head, have recovered . Cranes have returned to populate the horizon and the general public, both first-time applicants and investors, do not stop visiting the different real estate salons that are held annually on the peninsula. On the other hand, the prices that are rising year after year could be a problem in the medium and long term because they can leave thousands of young applicants out of the property market or even rent that is already in a worrying bubble process .

If the year 2017 finally ends with a price rise of more than 10%, then the market will make the same mistakes again . Let us remember the fateful crisis of the 2007-2013 period that caused so much recessive impact on the economy and on Spanish society.

Last. How is the settlement of the residential stock going ? Well it seems slow but safe. Of those 800,000 empty and lost apartments in real estate limbo, experts say that there are only fewer than 300,000 units left, and that little by little the work of SAREB, servicers and other real estate agents is draining this amount. But the most interesting is the future of the Spanish real estate sector. If Spain, which has been sailing for several years with a wind in favor of the 3% annual growth of its " palo mayor ", its GDP, is able to maintain it for a few more years, the best is yet to come.

Confidence has returned in the economy, much more and better is being produced. It is exported quickly and well and year after year foreign and foreign currency is imported, mainly for tourism. Our national wealth par excellence. Unemployment is decreasing and household debt too, but, I insist, prices cannot and should not grow exponentially again in case we stumble over the same stone again. Let no one go redania's most wanted

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The investment landscape brings great news under the arm

Finally, regarding the investment scene, the real estate market is already starring most of the great news from the last two years . Every month real estate assets of various kinds are bought and sold. So much so that analysts have estimated the investment volume in the 2014-2017 period at around 40,000 million euros. What are these investors looking for? Especially assets denominated prime and with a good and safe profitability. Emblematic towers, megacenters and commercial surfaces, premises or flag ships stores, finalist land, well located logistics complexes with better tenants and large residential areas. There is a lot of money on the table. The processes of quantitative monetary expansion initiated years ago by both the US FED and the European ECB have yielded their results.

In Europe, the Euribor is still at the bottom. For all these reasons, it is not surprising that, if there are already more than 30 SOCIMIs ( Anglo-Saxon REITs ), headed by Merlin Properties, in the next few months, many others will come out. The sector has breathed again and quarter by quarter it is recovering part of the ground lost in the previous expansionary cycle, period 2004-2006 . However, from METROS2 magazine that I have been editing for more than 25 years we know two inevitable truths. The first is that the "cycles" are always fulfilled. The Law of Gravity is sometimes cruel and everything that goes up a lot ends up going down as well qnnit.

Since democracy was proclaimed in Spain in 1975, the data shows this. And secondly, man is that singular animal that is able to trip two and three times with the same stone. If the markets acted with extreme caution, the BRICK world would be more reliable and secure . But in Economics, let's see who is the brave man who stops a speculative process and puts doors to the field. Although it is true that all the " traffic lights " of economic and real estate activity already shine green, the experience accumulated and lived during the last quarter of a century warns us. First of all prudence.