Market reports

The impact of Brexit

Britain has confirmed it will hold a referendum on continued membership of the European Union on 23rd June 2016. The vote looks likely to be close.

Since British buyers are a very active part of the property market, we wondered what might happen if a “Brexit” led to a fall in UK buyer activity?

The most reliable numbers we have on British buyer activity come from the registrars:

British buyers in Spain

British buyers as % of the housing market – www.registradores.org (2014)

The real question is how disruptive a “leave” vote be – and on balance we think the effects of Brexit would be very limited.

Nothing happening anytime soon

In the interim the UK would need to invoke Article 50 of the Lisbon Treaty in order to leave, and it would likely take a further two years to disentangle the country from Europe. In other words: This time next year Britain will still be in the EU and British buyers will have the same rights they have today.

In the longer term we expect to see a bilateral deal emerge that would (at worst) make it only slightly harder for UK buyers to invest in Spain. EU membership is hardly a barrier to investment: China is outside of the EU but it hasn’t stopped the Chinese taking an active part in the Madrid property market; British buyers would be no different.

Regional variations

International buyers are a diverse group and some regions will clearly be affected more than others, so we’ve compiled a list of British vs. other nationalities in each region of Spain. The effects of Brexit would be very localised: Murcia is most exposed but even the worst scenarios would only see the market move in single digits.

Overseas investment by region:

Andalucia Cantabria La Rioja
Aragon Castille and Leon Madrid
Asturias Castille La Mancha Murcia
Balearic Islands Catalonia Navarra
Basque Country Extremadura Valencia
Canary Islands Galicia

Andalucia

International buyers make up 15.4% of the housing market in Andalucia.

Nationality % of int’l buyers
United Kingdom 22.91
Sweden 9.44
Belgium 8.17
Russia 5.59
Norway 5.42
France 5.11
Germany 4.43
Morocco 3.44
Netherlands 2.71
Denmark 2.54
Others 30.24

Aragon

International buyers make up 4.2% of the housing market in Aragon.

Nationality % of int’l buyers
Romania 32.68
China 11.55
Morocco 7.04
France 3.66
Algeria 3.38
Ukraine 3.1
Bulgaria 1.97
Italy 1.69
United Kingdom 1.69
Peru 1.41
Others 31.83

Asturias

International buyers make up 1.8% of the housing market in Asturias.

Nationality % of int’l buyers
Romania 22.47
France 6.74
Poland 5.62
Germany 4.49
Belgium 4.49
Italy 4.49
Portugal 4.49
Ukraine 3.37
United Kingdom 3.37
Mexico 2.25
Others 38.22

Balearic Islands

International buyers make up 32.6% of the housing market in the Balearics.

Nationality % of int’l buyers
Germany 34.56
United Kingdom 19.4
Sweden 7.02
France 5.64
Italy 5.05
Switzerland 2.79
Russia 1.84
Belgium 1.61
Netherlands 1.51
Austria 1.31
Others 19.27

Basque Country

International buyers make up 1.5% of the housing market in the Basque Country.

Nationality % of int’l buyers
China 15.82
Romania 8.67
Italy 7.14
Portugal 6.63
United Kingdom 5.1
Russia 4.59
Germany 3.57
United States 3.06
Argentina 3.06
Morocco 3.06
Others 39.3

Canary Islands

International buyers make up 27.4% of the housing market in the Canaries.

Nationality % of int’l buyers
United Kingdom 19.54
Italy 17.74
Germany 13.87
Belgium 9.99
Russia 3.85
France 3.68
Sweden 2.68
China 2.07
Ireland 2.01
Poland 1.8
Others 22.77

Cantabria

International buyers make up 1.9% of the housing market in Cantabria.

Nationality % of int’l buyers
France 13.13
Moldova 7.07
Romania 6.06
China 5.05
Germany 4.04
United Kingdom 4.04
Mexico 3.03
Russia 3.03
Peru 2.02
Netherlands 2.02
Others 50.51

Castille and Leon

International buyers make up 1.2% of the housing market in Castille and Leon.

Nationality % of int’l buyers
Romania 7.07
Bulgaria 5.39
China 4.04
France 2.02
Morocco 1.68
Portugal 1.35
Brazil 1.35
United Kingdom 0.67
Ukraine 0.67
French Guiana 0.67
Others 75.09

Castille La Mancha

International buyers make up 1.4% of the housing market in Castille La Mancha.

Nationality % of int’l buyers
Romania 21.69
Morocco 10.84
China 10.24
Ukraine 4.22
Bulgaria 3.61
Italy 2.41
Brazil 2.41
Argentina 1.81
Peru 1.81
Paraguay 1.81
Others 39.15

Catalonia

International buyers make up 13.2% of the housing market in Catalonia.

Nationality % of int’l buyers
France 29.31
Russia 9.8
Italy 5.34
China 4.91
United Kingdom 3.86
Belgium 3.77
Germany 3.67
Morocco 3.22
Romania 2.45
Ukraine 1.83
Others 31.84

Extremadura

International buyers make up 0.5% of the housing market in Extremadura.

Nationality % of int’l buyers
Morocco 6.52
Belgium 4.35
Portugal 4.35
United Kingdom 4.35
Others 80.43

Galicia

International buyers make up 0.6% of the housing market in Galicia.

Nationality % of int’l buyers
Portugal 5.94
United Kingdom 4.95
China 4.95
Romania 3.96
Russia 3.96
Switzerland 3.96
Venezuela 3.96
United States 2.97
Argentina 2.97
Brazil 2.97
Others 59.41

La Rioja

International buyers make up 2.7% of the housing market in La Rioja.

Nationality % of int’l buyers
Romania 30.43
Morocco 8.7
Italy 5.8
France 5.8
Portugal 4.35
Armenia 4.35
Georgia 2.9
Bolivia 2.9
Pakistan 2.9
Colombia 2.9
Others 28.97

Madrid

International buyers make up 4.5% of the housing market in Madrid.

Nationality % of int’l buyers
China 21.53
Romania 14.27
Italy 7.4
Morocco 4.09
France 4.04
Ukraine 3.6
United Kingdom 2.87
Venezuela 2.58
Bulgaria 2.09
Russia 2
Others 35.53

Murcia

International buyers make up 15.9% of the housing market in Murcia.

Nationality % of int’l buyers
United Kingdom 44.29
Norway 6.32
Belgium 6
France 5.48
Morocco 4.77
Sweden 3.74
Germany 2.77
Netherlands 2.19
Russia 2.13
China 2
Others 20.31

International buyers make up 2.3% of the housing market in Navarra.

Nationality % of int’l buyers
China 9.9
Morocco 8.91
Ukraine 8.91
Portugal 7.92
Romania 7.92
Bulgaria 6.93
Russia 5.94
Italy 4.95
France 3.96
Moldova 3.96
Others 30.7

Valencia

International buyers make up 27.1% of the housing market in Valencia.

Nationality % of int’l buyers
United Kingdom 15.57
Russia 11.84
France 9.11
Belgium 8.71
Sweden 7.97
Norway 6.71
Algeria 6.49
Germany 3.9
Netherlands 3.3
China 2.44
Others 23.96

The Bottom Line

We don’t see Brexit as a major problem, especially if you deal with a broad range of nationalities. The timeline is slow, the market is diverse and alternative arrangements are unlikely to dent the British love affair with Spain.

Leer este artículo en español ›


Kyero.com

Kyero.com promotes 200,000 properties in Spain to international buyers in 13 languages

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