I’m with Sean Woolley, managing director of Cloud Nine Spain, who’s going to give us a half year / July market update.

Hello there, Alfredo. Well, so, we just ended our quarter two, our half year and I’m a stats man, so I love going through the figures on the 1st of July and working out who’s done what and are we up, are we down, opposed to last year? And the interesting thing is, last year was our busiest year ever in 20 odd years of us being here, which is great. And I thought, oh, that’s going to be hard to beat. And actually we’re ahead of where we were last year at the same time, which is fantastic. And I think we discussed three months ago, six months ago, that I felt that this year would see a first quarter, maybe the first two quarters still satisfying that pent up demand that was left over from people not being able to get here because of COV**. And we’ve certainly seen that. I wasn’t sure whether it was going to kind of tail off into quarter two, that we would’ve satisfied that demand, particularly at the top end of the market, but it’s proven otherwise. And we’re still getting a lot of people coming over, we’re still getting a lot of property tours, a lot of people making decisions very quickly and the budget levels seem to be bearing up, which is great. We’ve actually done more transactions this year, but at a slightly lower level. So I think last year, our average transaction was around a million Euros. So far this year it’s around 800, 850. So we’re down slightly on revenue per deal, but the amount of deals is higher. So there’s more buyers in the market, you would think from those stats, but maybe at a little lower level.

And which nationalities have been buying from you this half year?

A complete mixture, honestly. It’s similar to last year in that, I think last year we had a situation in one month where I think we did 10 or 12 deals and they were all different nationalities. And again, I did an analysis of quarter two and I think we had 21 different nationalities right across the quarter, which was amazing. And I think that just signifies the cosmopolitan and diverse nature of the market here. I know for instance in the UK, there’s a massive cost of living crisis, people are talking about maybe a recession coming along, interest rates are rising, and fuel prices are going up. So everyone’s a little bit kind of depressed in the UK at the moment about what’s happening, their money isn’t going as far as they would like. But actually, I’m sure that has had a little impact on the Marbella property market. But it’s not the whole story, because we are not reliant on the Brits. I think we were maybe 20, 25 years ago, but we’re not anymore. I mean, our most dominant nation of buyers in June was Germany. So I think we had four, three or four German clients, which is bizarre, because normally Germans like to deal with Germans and the website is written in English, there isn’t a German translation available. So we’re somehow getting these inquiries from Germany and not only that, but we’re satisfying their demand and what they need.

Okay. So now talk to me about what areas are hot, what areas are not and what’s happening with property prices? Are they continuing to rise? What’s happening from your perspective?

So you can imagine, I see lots and lots of properties, hundreds, and I also am emailed a huge amount of properties. Every day I get literally tens of offers, you must see this and this is for sale and that’s for sale. And I also do my own searches, not only for clients, but also for my own research. And I’m actually trying to buy a little investment property as well on the Golden Mile. And what I’ve noticed is that some developments, it’s really hard to get stock. If you see something available, you’ve just got to buy it, because one example is Four Seasons in Los Flamingos, which is where I used to live, and that has 96 apartments and penthouses within the boundaries of the development. And at any given time, normally on a development of that size, you’ll have between five and ten percent of the inventory available for sale. So 96 apartments, you would expect there to be between five and ten units for sale. And that’s kind of typical of where we’ve always been. At the moment, there is nothing, absolutely nothing. We’ve sold it all, basically, which is great for us. But we now have a position where we have nothing for sale, nothing to offer people. And I have two clients, who of course, because there’s nothing available, they want something. We all want something that we can’t have and we all want something that other people have got. So of course, now I’ve got a waiting list of clients. So it’s a great time. If you’ve got a property in Four Seasons in Los Flamingos, now is the time to sell if you want to sell, because I have a waiting list of clients who want to buy in there. So it’s a similar situation in Los Arqueros, which is a lovely golf resort up the Ronda Road. Price ranges on apartments between 250,000, 300,000, up to maybe 600,000. So similar to Four Seasons. Again, the dominant agent there told me that he’s got like two or three properties and that’s an even bigger place. That’s got hundreds of properties in its inventory. So a lack of stock there. The place I’m looking to buy, a little investment property, Señorio de Marbella, on the Golden Mile, I think there’s three properties available out of probably 100 units. That’s not a lot of supply. So when something becomes available like it did last week and I went to look at it and bang, I’ve just made an offer, trying to get the deal done, and before somebody else comes along and takes it from under my nose.

What about in the high end?

The flip side to this is that I’m seeing quite a lot of price reductions. Now, don’t get excited, everyone, because it’s not going to be a fire sale here, but I think what we’re seeing is a correction in the market, which I’m not surprised by, and I think I predicted because I think there was such a huge demand from overseas buyers towards the the second half of the pandemic, when we were all locked up. People just wanted to buy over the phone and blah, blah, blah. And people would just pay whatever they needed to to be in a certain location. And I think what we’re seeing now is that those days have gone, and I think there’s now a more considered type of buyer in the market, someone who is going to take a look and maybe take their time. But because of that, I think we’re seeing a little price correction, particularly at that mid-high and high level of the market. I’m not seeing prices going up in that sector. And even from the big boys who sell a lot of these units, it’s like, oh, the price is… “new price” And you think, oh, has that gone up? And you check, well, no, it’s gone down. So look, they’re not massive discounts. As I say, this isn’t a fire sale, but I think there is a little bit of sense and normality returning to the market which is a good thing, and I think now, yeah, there’s just a little bit of a reduction on the previously very ambitious pricing on certain properties. Some properties have always been well priced and good value for where they are. Some are being a little bit hopeful. It’s almost like the listing agent has gathered their team around the table and said, right, okay, so the next available one in this region is five million Euros, what should we price this at, six? Nah, call it 10. I’ll tell you what, call it 20. That’s how it feels, some of these things are being priced and now people are thinking, oh, actually, that was never worth 20, was it? Is it even worth 10? Think now there’s just a bit more sense and normality returning. As I say, it’s not a market that’s in any sort of distress at all, absolutely not, but I think we’re just seeing a few little tweaks that are making it a better market.

During last year, there was a lot of talk of different new projects, some of them branded residences and things like that. Has there been anything this half a year that’s come out of the woodwork that sounds interesting for the future?

The guys in Sierra Blanca Estates have been very busy So busy that we can’t get a meeting with them at the moment because they have obviously… They’ve launched Epic, which is a great development, and the second half of that was co-branded with Fendi Casa and they are releasing another project which has associations and links with Karl Lagerfeld. And then they have Marbella Design Hills, which is a development that they’re very excited about which is going to hopefully include a boutique hotel and all sorts. And that is one end of the Sierra Blanca / Golden Mile, and they’re going to create something very spectacular there. It’s not going to be cheap, but I think they’re aiming, they’re another one who’s aiming at that top end of the market. And their apartments at Epic are priced two, two and a half, three, three and a half, four million. And people might think goodness. But actually they are super luxurious properties. Lock up and leave. But they have that association with the the luxury interior design brands that lift the whole thing. And of course attract a premium. So that’s very exciting what they’re doing there. We are seeing areas that are attracting investments. So yesterday I was down in Estepona, just past Estepona town where they’re building the new… Have built the new hospital. And there’s a lot of land there. Then they’re building five or six different developments. So there’s things going on all the time. And of course, if people want new and shiny and good specifications and all the modern qualities that people now expect, then they either have to buy something that’s very recently built or they have to buy something that’s off plan. And very often they can get a better deal off plan in terms of price and payment terms, but the downside is of course that they have to wait for it. And that’s always been the problem, having to wait for something for 18 months or two years, but at least you have the pick of the units because two years down the line, if that development is really good, you could end up in a situation like Four Seasons or Señorio de Marbella, where you think, right, I’m ready to buy now, and then there’s two on the market and they’re both in awful blocks. So you haven’t got the choice in the resale market. It’s a really interesting market and it’s there’s not one rule that applies the whole market, it’s little bits. And you need to understand it and have been here a while to appreciate where it’s at and where it’s heading.

So one question then. With this stuff that you’re talking about from Sierra Blanca Estate’s Epic by FENDI Casa and the Karl Lagerfeld villas and this new Marbella Desging Hills, which I think I read somewhere is, it’s a 250 million Euro project, so it’s pretty massive. That sort of thing is probably getting some traction in countries where Marbella doesn’t normally appear on the map so much. And I was wondering whether you’ve seen any traction or if there was anything happening with the US market and over at the North American market.

In the last 12 months we’ve been very active with American and Canadian buyers. I think you’re right, what you say, branded residences tend to attract countries that love a brand. We all know from the success of London’s Bond Street that they attract wealthy people, particularly from the Middle East and the far east. But the American market is very interesting as well, because the Euro has just dipped today, I think, to the lowest level in 20 years against the dollar. So it’s a great time for American investors to use their dollars to buy a Euro asset. We’re reaching out to our American client base and saying, did you realise this? And here’s some options for you to consider. So yeah, there’s always movements like that. When one country is maybe having a rough time or bit down in the dumps, like the UK seems to be at the moment, there’s always somebody else who things are looking up and the exchange rate is in their favour, or they’ve got a tax break or something. That’s the beauty of Marbella, in terms of where they’ve now positioned it as an international brand, really. I mean, there’s nowhere else that compares in Europe to the lifestyle that can be offered in Marbella. And I think what they’ve done very cleverly is they’ve positioned it internationally. So we’re not reliant on one market. We’re not reliant on one type of buyer or one type of personal profile. So it’s very interesting and it’s very dynamic.

Give us your prediction then for the second half of 2022.

Well, the interesting thing is, we have a really good kind of work in progress book at the moment. So for quarter three, we are anticipating a similar level of success to what we achieved last quarter three in 2021, which was our record quarter ever, because we have a number of big hitters. And I think in quarter three, what you have is that you have the clients who want to combine a property purchase with a bit of a holiday. We’re expecting a busy time because someone’s always busy. We have a lot of people here generally, but a lot of clients who are looking. And in the past, you could never quite rely on the quality. It would just be people who speculatively want to take a day out of their lying on the beach, particularly if it gets a bit cloudy, you suddenly get a load of phone calls. Can we go and see this, can we go and see that? I think those days are gone, actually. I think now it’s a more considered type of client. And I also think that the budget level that we’re dealing with means that those clients are more considered, they’re more thoughtful about what they’re doing. But no, we’re going to have a busy summer. At some point, we are going to have fulfilled and satisfied that extra demand as a result of the CO**** problems that we have, when people couldn’t get here. I thought it would be by now, looks like it isn’t, or maybe there’s just so much demand out there from people who just want a better lifestyle. That CO*** impact has worked in two ways. It locked everyone in but everyone’s now coming out and it’s also made people think, you know what? There’s more things to life than working in an office. It’s time to live a little, it’s time to go and get that holiday home in the sun and maybe work from there and maybe go and live there, and I think we’re seeing a lot more of those types of clients and lifestyle has become a huge, huge factor. No, one’s buying here for a quick flip and to make 100 grand. Those days are gone as well. People are now buying here for the medium to long term. Of course, no one wants to lose any money on their property purchase. But I think people just want to enjoy their life with their friends and their families and just chill out a bit.