As the first month of the year has already gone by, the property sector starts to gather information on how the sector will evolve during the current financial year. Since favourable International Monetary Fund (IMF) predictions have become known -this year’s world economy growth forecast has already risen to 2.9% and 1.1% in Spain-, ‘2023’s mood differs from the end of 2022, albeit still in an unstable macroeconomic scenario that introduces great unknowns which compels us to be cautious.’
As was summed up by Vicenç Hernández Reche, Tecnotramit’s CEO, who forecasts regarding the evolution of the Spanish property and mortgage markets. One of the leading service companies for financial institutions and property companies in Spain and Portugal. It has a network of 34 offices throughout the Peninsula; headquarters in Barcelona, Madrid, and Lisbon, and a team of 1,200 people.
2023 will ‘start small and build from there’ guided by business innovation
Hernández Reche, also an economist, doctor in Economic Psychology, and chairman for the National Association of Property Agents (Asociación Nacional de Agentes Inmobiliarios, ANAI) and the Catalan Association of Property Agents (Asociación de Agentes Inmobiliarios de Catalunya, AIC), claims ‘2023 will start small and build from there concerning the number of residential asset purchases, which will strengthen trends still in the maturing process and will be the basis for the new property cycle we are entering into.’ ‘The future of inflation will be a macroeconomic factor on which economic progression depends for stability and sector regeneration or other less optimistic scenarios.’
Banks adjust mortgage offers to inflation and rise prices
In this respect, Carles Solé, Tecnotramit’s Mortgage Loan Coordinator, provides keys about accessing the mortgage market and rising prices for financing due to growing interest rates and the options when choosing a mortgage and its features. ‘Both institutions and consumers consider different possibilities but not element makes a decision more favourable than its counterpart beyond searching for and comparing the market for diverse offers.’
The expert reminds that during the last triennium the banking sector strengthened fixed rates since these were so low minimum profits had to be guaranteed. ‘Since interest rates are rising, financial institutions are supporting variable rate mortgages and higher interests are applied to fixed rate ones. This is why the client will have to search for offers and see what features can reduce interest rates according to the connection with the institution,’ as pointed out by Solé.