Spain increases tourism spending to try to speed recovery of the sector

The Spanish Government has announced that it is to spend an additional 400 million Euros on tourism infrastructure this year, taking the total spend to a billion euros this year, up from 600 million last year.

This comes against figures showing a 2.6% drop in actual tourist numbers visiting the Spain last year.  However it is not all bad news with figures from popertyindex.com revealing a 26% increase in searches for Spanish property in January and February, compared to 12 months ago.  It remain to be seen if this will translate into actual sales remains to be seen.

Spending areas on which spending will be included new or upgraded shower and lighting along beaches on the Costa del Sol.  That said the bulk of the money will go infrastructure, with many building projects being highlighted, as a means of providing relief to the collapsed building industry.

Generally though the news from the Spanish property market is pretty bad all round, with the only good news stories relying on the assumption that the rest of the worlds slow turn round is automatically good news for Spain, as the more countries that start to come out of the falls, the more likely investors from those countries will come bargain hunting in Spain.  The Spanish domestic market has not yet shown any real signs of recovery, with the latest figures for repossessions showing that the number of repossessed properties doubled last year to over 50,000, and banks are expecting that the numbers may well increase by a similar amount this year, toping 75,000. 

The only good news around is that the number of construction projectscompleting has finally started to fall, dropping by 34% in January, compared to the same time last year, and with almost no new developments starting last year, it is expected that this tend will continue, taking some of the pressure off the market, and allowing the glut of unsold housing to reduce. 

Giving the Spanish market a rating above grim, is difficult – especially as the advertised asking prices are not falling at anything like the real prices.

Until next time if you have any questions or comments, drop me a line: andrew@andrics.com