The Spanish real estate sector is positive for the coming months and sees in the aid from Europe a hand extended to the recovery of the real estate business in the country. After European leaders reached a agreement to create a reconstruction fund for 750.000 millions of euros to fight the crisis of covid-19, of which Spain will receive 140.000 millions of euros, real estate professionals have given their point of view on how the sector can benefit in the short to medium term. Consultants like CBRE, Savills-Aguirre Newman or Colliers, and economists They talk about how this loan will impact their business and how you could benefit.
Susana rodriguez, CCO de Savills-Aguirre Newman, ensures that “taking into account that the evolution of real estate fundamentals is directly proportional to the evolution of GDP, and that we need higher growth rates than our European neighbors to create jobs, these aid will be essential for the sector ".
The board also believes that digital transformation will be key in this investment, with spearheads such as the digitization of Public Administrations (as was done with the Treasury), “That would radically change our interaction with the public sector, key agent in soil development processes, both for economic activities and for housing, for sale and rent, as well as the much-needed streamlining of licensing procedures ".
Mikel Echavarren, CEO of the real estate consultancy Colliers, He also sees a direct impact of these grants on the residential business in Spain. "To the extent that a part of its resources is allocated to the residential sector, either with youth home purchase incentive programs or for the development of rental housing, it will obviously have a positive impact, but so far there is no evidence that the Government has considered using part of the resources for this purpose ", dice.
However, Echavarren is cautious: “It is still too early to assess what the impact could be on the real estate sector, because we do not know what that money is going to be spent on and also what are the conditions that Brussels will require for its reception. If the conditioning of the use of that money meant cuts in public spending and pensions, indirectly it would have a negative effect difficult to quantify in the real estate sector. In any case, an injection of money of this level should have a very positive impact on the maintenance of economic activity in Spain, in the sustainability of employment, and as a consequence very favorably in the residential sector. "
On the other hand, the consultant CBRE see the potential of this help, especially, in the construction of sustainable buildings as a generator of employment, as well as urban regeneration and renewal. “It is important to highlight the potential of the investment of part of these funds in sustainable construction for its ability to create jobs in the short term, and because it also goes in the direction of favoring ecological transition What is it, along with the digitization of the economy, one of the pillars on which the plan for the reconstruction of the European economy post covid-19 is based. In this sense, the objective would be to adapt the existing buildings and housing stock, with a considerable level of obsolescence, to clean and renewable energies. Also, for each new construction home that is built, three direct jobs are generated, therefore, the residential real estate sector should be encouraged, and favor green mortgages ", explain.
Data in which Rodríguez de Savills-Aguirre Newman agrees: "The ecological transition will be crucial to get these grants, and if buildings are responsible for the 30% of global energy consumption and CO2 emissions, for achieve the environmental commitments to which we are bound to access aid as a country it will be necessary to approach the standards of buildings with almost zero consumption, which would definitely change the design and construction processes in our sector, and therefore it would force us to rehabilitate a high percentage of our existing real estate stock”.
In that same line, Daniel Lacalle, chief economist at the private banking firm Tressis, believes that the most positive thing is that with these funds they will be able to carry out “energy renovation plans of all kinds in buildings”, which will be a shock for the construction sector and companies specialized in reforms or rehabilitation, and that will allow Spain to advance in terms of efficiency. However, doubts that the aid can have a direct impact on sectors such as residential or 'retail', one of the most punished since the COVID-19 crisis broke out. “I do not think that for this reason housing transactions will grow much or that they will close for a higher price at a time like this, although without a doubt the energy improvement allows houses to have more outlet on the market”, Lacalle asserts, that recommends establishing tax incentives as a formula to re-float the sector.
Also, the economist asks for caution when evaluating this type of aid, and gives as an example countries like the USA, UK or Japan. “It is clear that these plans serve to mitigate a negative effect, but it is not so clear that they can be an impulse”, Add.
Maria Jesus Fernandez, Funcas senior economist, He is also suspicious of the 'lever effect’ that may have European aid, and Trust the future to the evolution of the pandemic. “The bottom is no magic wand, I do not think it has little impact in clearing the huge uncertainties that exist now. If the outbreaks get worse, if there are new confinements, if international tourism does not return to something close to normal (not this year, but the next), the economy will continue to suffer. Serves to calm the financial markets, At least in the short term, but I think its effect on the uncertainty that now affects decision-making is small”, holds.