How will the new omicron variant of COVID 19 affect the Spanish real estate market?
The Spanish real estate market is, for many Europeans, the most desired destination. Owning a property in a paradise where you can spend several weeks a year is a dream come true. Although real estate was initially severely hit by COVID, it is now enjoying a major comeback.
But what will the emergence of the omicron variant bring to the equation? Read on, find out what the experts say, and prepare your next move; a piece of paradise to call home may be waiting for you in Spain.
The omicron variant and the markets
After the WHO (World Health Organization) declared the omicron variant, first discovered in South Africa, to be an increasing concern, the markets echoed that. In the light of those statements, global markets responded with worrying numbers.
For example, listed real estate went down by 4%. In other words, the fear of a new lockdown put most of the world’s business endeavours on hold. Furthermore, real estate investors echoed this trend by freezing their actions in a recovering market.
As a result, the concerns of contractors and developers grew and the ongoing developments hit a plateau. Likewise, the word volatility started appearing in newspapers and being heard on the streets.
Market volatility and beyond
What does ‘market volatility‘ mean and what does it generate in the real estate market? Well for starters, it indicates a steep fluctuation in prices which prevents predictable market behaviour. In that sense, indicators like inflation might begin to be a more dramatic element for European citizens.
That being said, market volatility is also the adventurous investor’s best ally. That‘s because those who need liquidity to be able to face new challenges are more open to negotiating property prices. On the other hand, those with the liquidity to purchase properties might be able to close the deal of a lifetime.
Making a bold move in times of crisis might ensure the business of a lifetime. For that to happen though, you need to make sure you have the right financial advisor. In fact, those who receive the best financial advice might well be the ones to come out of the omicron crisis with a new, improved, economic status.
Policies and fear
After living through the pandemic and surviving the delta variant (also labeled as a ‘variant of concern‘ by the WHO), most people know that government policies are crucial to market behaviour. In that sense, the communal fear of a new lockdown could be the biggest setback for a recovering market.
Indeed, the new restrictions that may be imposed in Europe due to the omicron variant could even make it difficult for foreigners to visit Spain and vice versa, since free transit among European countries was one of the first things to be banned in 2020 with a view to halting contagions.
Although that is past history now, the memory and consequences of those times still live in most people’s minds and pockets. So newly-announced policies will be crucial, especially in the early period of the omicron variant, to predicting the behaviour of the volatile real estate market.
Knowing that volatility is the name of the game in times of pandemic, those who have the funds and are bold enough might well close the real estate deal of a lifetime. On the other hand, those who are willing to sell might find that liquidity is the best weapon with which to fight back in times of lockdown.
Whichever is your case, crises usually bring the best investment opportunities for those who can take advantage of them. Make a bold move and buy a piece of paradise to call home for at least some weeks a year.