How have property prices fluctuated over time?

We explain what can affect the price of your property and what to bear in mind when buying or selling your house

Property prices can fluctuate up and down from one year to the next based on the economy. In Spain, the housing market suffered from the real estate bubble that burst in 2008. The effects of the economic crisis on housing prices caused by the real estate bubble affected both owners looking to sell their home and also potential buyers. This is because the fall in prices became a deterrent for selling real estate and granting mortgages.

However, since 2015, prices have gradually started to recover. In 2017 specifically, the average price per meter squared rose 4.3%. The forecast for the coming years is expected to be positive, barring any unforeseen events. On the one hand, economic growth and increasing employment are expected to have a positive impact on the real estate market, allowing for further expansion. However, the real estate tax (IBI) is also expected to go up.

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For most people, buying or selling a house is one of the most important decisions they will make in their life. Therefore, if you are thinking about buying or selling, there are several factors to consider, such as the current price of the home, how its value will change over time, additional costs when buying or selling a property, and the current economic landscape

Factors that can influence housing prices

Generally speaking, the price of a home depends on features such as quality, size, and available services, not to mention location and market circumstances. This last factor is one of the most important things to consider because economic indicators significantly influence housing prices.

On the one hand, prices are determined by supply and demand. If the housing demand goes up, the prices also rise. However, housing prices fall if the supply increases.

Additional costs associated with buying and selling houses

When someone decides to buy a property, they often forget that, in addition to the actual cost of the house, there are certain additional costs that can significantly increase the total price. When a buyer acquires a house, they not only pay the price set by the seller, but in most cases also pay interest on the mortgage loan, mortgage deed, land registration, and property appraisal. What's more, in certain cases, buyers have to bear other expenses, such as the capital transfer tax (ITP) and VAT.

Furthermore, selling a property also involves a series of additional costs for the seller that can increase the final selling price. These costs include the tax on the increase in the value of urban land (capital gains tax), which is taxed through the Personal Income Tax.

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Needless to say, deciding to buy a house is no easy task, especially if you consider the instability of property prices in recent years due to the economic crisis. To help you to make an informed decision, BBVA has created the BBVA Valora application so that you can calculate your monthly payments and other associated costs.

BBVA Valora gives you approximate valuations of real estate in your city in just a few clicks. From here you can analyze and closely monitor the evolution of housing prices and find out the cost of certain houses. Make sure to check out all the tools available on bbva.es to stay up to date with the evolution of the housing market.

You can also now download Valora View to your cell phone. This app helps you find out the approximate price of any property using information obtained from the Land Registry and based on similar properties on the market.

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