Finish a COURSE full of shocks and uncertainties
As in most sectors, real estate has gone through a 20-21 roller coaster course, despite this we can’t complain since we have always managed to work; in other sectors are still suffering a lot!
Regarding AMAT workers, we must thank the daily effort, despite the sick leave, the lockdown, the quarantine, the uncertainties… they have managed all the difficulties that appeared with professionalism and positivism. Despite all this, they have reached the end of the course exhausted in need of vacations, so this year we have decided to close 15 days from August 9 to 20. In the case of the heritage-communities area, there is, as always, a 24-hour service for incidents that may occur.
The activity of the real estate sector during the first semester has been quite important as it can be seen in the following data:
21% more proceedings have been closed than in 2019, we do not use 2020 as a reference because it was absolutely atypical. This does not mean 21% more in invoicing, since there has been a re-positioning of prices, especially in the city of Barcelona. The reason for the re-positioning has not only been due to the income regulation law in September 2020, but the market was already regulating itself long before.
In brand new homes we have sold less than in the first half of 2019, the main reason has been that some of the developments that we commercialize are coming to the end or have already finish and there are very few homes left.
The second-hand has been maintained more or less the same activity in all the offices as in the same period of 2019, but with an important difference, the average sale price has been much higher than that of 2019, a trend that we are already beginning to notice clearly after the 2020 lockdown. Surely, it is a lack of supply that has characterized the market these first six months.
In general, prices have remained stable in brand new development and in second hand, with the COVID crisis there has been some expectation of a significant drop in prices, which has not been the case.
Luxury has also continued with a similar activity to 2019, but in this case it has focused on the surroundings of Barcelona than instead of the city itself. We are still waiting to recover the foreign buyer who during these first six months of 2021 has almost disappeared due to the lack of international mobility.
One of the questions that we had at the beginning of the year was how the evolution of the rental negotiations of people or companies, which could have payment problems in relation to the incidents of COVID, would be. Actually, during these first six months of 2021 the incidence has been very low, only with some re-negotiations and extension agreements in some premises that have continued having difficulties. About housing, we can say that the incidents have not existed.
In the media we have also heard many times comments of what they say “silent evictions” referring to owners who do not renew the rental contract at the end of the period established in the contract.
In terms of resignations, tenants who leave before the end of the period established in the contract, we have had 33% more than in the same period of 2019. In fact, the vast majority of contracts never reach the end date because the tenants are leaving. There have been several reasons this 2021, the tenants have bought a property, they move to a better property or return to the family home. The average tenant stay in a property has historically been about 3.6 years.
On the other hand, we have analyzed the renewals we had this first semester, a contract that ended in this period, most of them have become contract extensions promoted by COVID legislation and by the owners.
In other words, are there “silent evictions”? Sure, there are cases. Is it a majority practice? Not at all, and the data backs it up. The problem is that from few cases in the media a theory is made.
We hope that we can enjoy a good holiday that will allow us to gather strength to assume the second half of 2021, which is still full of uncertainties.
Amat Immobiliaris President