This is a market update. We are coming to the, well, I suppose we’re into the end of quarter two, 2023, and we haven’t done a market update for a while. 

So Sean tell us, how’s the market?

It’s great. The market is, well, here’s the thing. So I think I said, I’ve been saying for the last couple of years, that we have that surge, didn’t we, of demand, which we expected after Covid, where a lot of people managed to get on planes and get over here and sort of get their buying processes moving. So we had a very successful 2021. 2022 was almost as successful, there was a slight drop-off because I think we had satisfied that. And then this year, I thought we’d see a little drop-off again because I thought, okay, we’ve done that. And actually, so far this year, touch marble, we are on target to replicate 2021 in terms of sales figures and sales revenues. So, and 2021 was our record year, our post-COVID kind of boom thing. And 2023 is kind of heading the same way, which is a little bit surprising for me because, as I say, we thought that we’d satisfied that glut, but I think what’s happened is that we’ve got two things going on. We’ve got these headwinds, which everyone knows about, the fact that there’s a cost-of-living crisis, there’s higher inflation than normal, higher interest rates than normal, there’s a war going on in Eastern Europe. There’s all those sorts of nasty things happening. So they’re kind of in our faces, buffeting at us. But then I think we’ve also got a huge tailwind behind us of people who just want to be here, you know? And I think that that has just more and more taken over. So a lot of those people who do want to be here are fairly well-moneyed. They can afford to buy here. They want a change of pace and a change of life for themselves and their loved ones. They want better weather. And they’re coming from all over the world. You know, it’s not just one market. It’s not just like UK buyers interested in purchasing in Spain. No, you know, we are dealing with people from the most obscure countries, little countries, all over the place. And we’re still dealing with the Americans, we’re dealing with someone this week from Australia who’s looking to relocate. You know, we’ve never had those sorts of clients before in the 21, 22 years I’ve been here. It’s always been like English, German.

Yeah, here’s a question for you. So going back 10 years ago, what percentage of your buyers were British? And how abot now?

Oh it used to be over 50%. Now it’s still quite strong at around 25, 30.

Is that because you’re English speaking?

Yes, I think so. I mean, we don’t translate our website into other languages. So we are for English speaking people, you know, for sure. But they’re just coming from everywhere. It’s, and it’s really heartwarming because I think the way that the tourist board or the industry experts or whatever have marketed this place now is as the California of Europe. And that’s a very attractive brand, a very attractive proposition, not only for Americans who know California, but also that, you know, like before, like 10 years ago, 15 years ago, it was always, where are you gonna buy? Is it gonna be Marbella or the South of France? We never hear about the South of France anymore. Just, it’s gone. So Marbella has become a destination. It’s become a destination where people can live the life they wanna live. It might be a glamorous life. It might be an authentic kind of Spanish tapas at lunchtime kind of life. But the nice thing is about this area is that you can dip your toe into that, those sorts of experiences whenever you want. So yeah, so as I say, we’ve got a few issues, but we’ve got the massive sort of thing that’s winning at the moment and it’s just the fact that people just wanna be here.

And would you say that how your experience in the market so far this year is representative of the market?

No, I think we were pretty representative, I think, of what’s happening. What I would say, the caveat to this, is that this year has felt like hard work. And look, it should be hard work, but it’s felt much more of a challenge and an effort that it has in the last two years when we’ve kind of done the same numbers. And I think that’s because there’s a lot of players in the market now, real estate-wise. Not all of them good, and we’ve done other videos about that. There’s a huge amount of people who are entering the market, setting themselves up as real estate professionals, offering advice and assistance, and that’s all good, and some of them are amazing. And it’s not necessarily about the size of the company or anything like that, but a lot of these agents, from our experience, don’t know what they’re doing, don’t know where they’re going, don’t know where things are, and they’re helping people buy investments worth five, 10 million euros. And it’s like, whoa, hang on a minute. So I think that has clouded the market a little bit for us. It’s made our job a little bit more difficult. There’s more competition, which is tough. So it’s felt like hard work, but we’re still producing the numbers. That’s how it feels to me. I just might be getting old and losing energy. Yeah, all right, thank you. It’s long Covid.

Another question. Last year you sold to a lot of American buyers, North American buyers, is that right? Is that still happening this year?

Not as much. So what we saw was we had that kind of six-month period, I think it was the middle of the year, where we did a lot of deals with Americans and Canadians, and then it went a little bit quiet, and now it’s just come back again, I would say similar times. And I think that’s because most Americans, when they come over to look, are probably gonna combine it with a holiday, let’s be honest, why shouldn’t they? They’re not gonna pop over for a weekend, they’re gonna come for maybe two, three, four weeks. And they’ll probably tend to do that, particularly if they’re a family, they’ll probably tend to do that in and around the school holidays, summer being the obvious one. So I think that’s where we picked up most of our American business last year, and I expect that to happen again this year. So it went a little bit quiet quarter one, and now the Americans are kind of getting back into it, I expect quarter two, quarter three.

With going back to the UK market for a second, UK is pretty volatile, politically, financially, housing, interest rates, you name it, there’s always something going on. When you’re dealing with inquiries from the UK for properties here at the moment, do they acknowledge that that’s there, not here? Or do they think the same is happening here?

No, I think they tend to feel that it’s a problem at their end, but they tend to feel that it affects everyone buying. So what they think is that, oh, well, the UK market is bad, so that means that you over there in Spain must be really suffering, because us Brits aren’t buying in bulk. It’s that kind of mentality, and it’s difficult, because you have to tell them they’re wrong. You have to say, well, actually, there’s still British buyers buying anyway. Yeah, a few of them are put off because of the cost of living crisis and various things, but actually, 75% of our buyers are from elsewhere, and they think the UK is a laughing stock.

Even nationally, actually, the British buyers in the last quarter, they were presenting, I think it was even less than 10% of foreign buyers, whereas going back to 2013 or something like that, it was like 25, 30%.

Yeah, and look, I get that. I think when you kind of get wrapped up in your own world and your own issues, but as I say, this has become an international destination, and it’s happened kind of organically. I’m sure there’s been some effort involved, but it’s happened to the extent that, as I say, now we’re meeting people on a daily basis from so many different parts of the world, and Marbella has the same appeal to them as it does to the Brits, and the people I meet from particularly the Eurozone, whether you agree with Brexit or not, they just think, why aren’t the Brits having the same fun we’re having? Why can’t they just come and…

With Brexit and the complications of residency that comes with that, have you noticed a change in whether the Brits are buying to relocate or whether they’re buying as a holiday home?

I’ve noticed a lot of Brits now looking to relocate, which is why the golden visa stats are really interesting because of how low they were. If you’re a Brit and you’re wanting to at least have the option of moving to Spain full-time, and you’ve got a budget of 500,000 or more, you would just assume that you would get the golden visa and have it there for a while. It’s there, ready, boom. But I’d have to ask the team, but a lot of my clients are looking to relocate. Even if they may not be ready quite yet, they’re looking at it as an option.

It starts off as a second home, a holiday home, but they’re actually buying it in view of in the future at some point, maybe making the move.

Generally. And I think a common theme amongst people from a lot of different countries is, just get me out of here. Get me out of the UK. Get me out of Belgium. Get me out of Germany. I don’t know what’s going wrong in these places, but obviously the UK has a few issues at the moment, economically, politically, as you say. So a lot of people, particularly people who are approaching middle age and who’ve probably now starting to acquire the funds to enable them to make a move, they’re all like, just get me out. That’s what we’re hearing. I’m not saying the UK is horrible. I love going to the UK. I’m from the UK, but there’s this wave of discontent and people thinking, do you know what? I just want a better life in the sun with my loved ones. I don’t want to be a part of this anymore. And I suspect that’s what’s happening in a lot of countries. It’s not just a UK thing. And a lot of people are coming here thinking that this is a bit of an escape. And it is, it’s a bubble. Marbella and Andalusia, I think is a, and I’ve talked about this before, it’s a bubble. It’s not the real world. It’s not the real Spain, but the real world’s a pretty horrible place at the moment. I don’t know if I want to be in it. I’m quite happy being in my bubble here.

It’s funny though, because everybody refers to Marbella, the Costa del Sol being a bubble. But I’m not sure that in real estate we really want to be adopting that term because it’s a different kind of, well, it’s a different kind of bubble that we mean, right? We mean like it’s sort of isolated in a bubble as opposed to a property bubble that’s going to go.

Because of course, a lot of people at the moment are saying to us, yeah, we want to do this. We want to buy, but is it the right time to buy? Are prices getting a bit silly? Do we need to hold back?

What’s your answer to that? Because if you asked an agent in 2007, is now the right time to buy? They would have said yes. If you’d have asked them in 2008, is now the right time to buy? They would have said yes. So in 2023, coming into the end of the second quarter, is it a good time to buy here?

Yes. But be careful. I’m buying property here. What could possibly go wrong? Though I’ve bought two properties here in the last 12 to 18 months. I’m buying another one hopefully in the summer in Estepona. I think you’ve got to be careful because yes, I think there’s been some overpricing, which always happens when you’ve got a glut of demand, which we’ve had post-COVID bubble. So I think you’ve got to be careful. There are some vendors who got a little bit excited with the prices. We’re starting to see them just come off a little bit now. So prices are stabilising and getting back to normal. But, I know what you’re going to ask, but there’s still a real shortage of stock in certain key locations. So I bought 12 months ago, 18 months ago in a place called Senoria Marbella on the Golden Mile, which is pretty much as close to Puente Romano Hotel as you can get. And now there’s nothing for sale. I’m getting approached. My property’s long-term rented. I’m getting approached by agents. Sean, would you sell your property? Would you sell it for this? Would you sell it for that? And I’m kind of like, maybe I would. But it just shows that, and it’s not everywhere, but in certain locations, normally the locations, of course, everyone wants to be in, there’s a real lack of stock because it’s all been snapped up. So that’s why the prices are, almost vendors can name their price.

And Sean, how does a buyer know when a property is overpriced?

We need to work with someone who knows what they’re talking about. So for instance, there’s a new development in Estepona, which is a lovely development. We’ve sold properties in there. We sold on the first and second phases at kind of 400,000 euros on average. They’ve just released phase three and the prices are between 750 and 850 for a similar kind of product. And I was gonna, I actually asked for the updated price list because I thought, well, that would be a good one to recommend to, it was actually a couple of footballer clients of ours. And I looked at the price and I thought, I can’t recommend it. I can’t recommend it because, if that was a standalone project, that phase three, and they were the starting prices, then okay, if people think it’s a great location, a great quality, fantastic, perfect, whatever. But the fact is, you’ve got two phases that have been built before you. With people in there who’ve paid half the price that you’re about to pay, they’re in control of the pricing on that resort, on that development now. So if you wanna sell your property, there’s probably gonna be people in phase one and phase two who are gonna be selling at 500, 600, still making money, and you’re stuck there having paid 800, you can’t do anything. So investment-wise, it doesn’t work. So you just need to be, there’s markets within markets here, and I’ve always said that. And you just need to have an expert guiding you to be honest with you, and to work through those kind of figures with you. There’s still value out there. I’m buying, I don’t wanna overpay for anything. So there’s still value out there, but you’ve kinda gotta look for it, and you’ve kinda gotta be guided along the path to find it.

So quarter two is about to finish, we’re about to come into quarter three. How do you see the next quarter or two? Do you see it cooling down further? Do you see it, what’s your crystal ball telling you?

Yeah, I think we’re probably just gonna see this consistent pattern now. We’re all gonna have to work hard because of the competition around us in terms of our industry, but that’s nothing to do with the buyers and sellers. But I think whilst Marbella remains the California of Europe, and a destination of choice, and whilst the sun is still shining, I can’t see anything changing. Because we’ve got people, as I say, looking to escape their home countries, whether it’s for holiday homes or to move. You know, the Ukraine war is awful, but it has opened up further opportunities in terms of people from neighbouring countries, particularly the Poles, buying here in bulk at the moment. I think most of that is because they want an investment outside of Poland, but also they wanna escape that part of the world. So, you know, some distress always opens up an opportunity, and we’re seeing that from the least sort of expected sources like that, really. So I think we’re gonna see a consistent flow. I think some of those excitable prices are just gonna drop a little bit, but almost that you won’t notice. It’s just that we get notified of price rises and price decreases, and we can see that there’s more that are just dropping off a little bit than are rising. But then you’ve got the dichotomy to that. You’ve got the areas where there’s no stock, where vendors can name their price. So that is a really complex market, and you need someone just to guide you through that to explain what’s going on and why it’s going on.

Well, Sean, thank you very much. Let’s see if this all pans out, and we can come up with a new term for we live in a bubble, because it’s not a real estate bubble. It’s a nice, warm, and cosy bubble.

Thank you.