PROPERTY SEARCH
ARCHIVED - Ukraine invasion halts housing construction in Alicante
The sector warns price hikes affecting materials and deliveries have "paralysed" new builds in Alicante province
Shortages and knee-jerk price hikes affecting building materials and deliveries following Russia's invasion of Ukraine have halted new developments in Alicante province, according to sector sources.
Employers' association, Provía, has warned that "price rises out of fear" have brought new constructions to a standstill, and the situation is unlikely to improve for some time "if the conflict continues".
The warning is in stark contrast to a bouyant 2021 when real estate investment on the Costa Blanca doubled.
Association secretary general, Jesualdo Ros, explained: "In spite of the pandemic, 2021 was a good year for the sector, as were the first two months of this year. Construction was one of the areas least affected by the health crisis. The optimistic forecasts for this year depend on the war ending as soon as possible so that we can return to normality without the situation getting more out of control."
However, the union maintains that whatever happens over the coming weeks "in a few months we can expect surprises in prices".
"We forecast a rise in the cost of housing due to a significant reduction in the current stock as no new developments are being carried out."
According to the employers' association, there is still a large demand pending the pandemic, which is what is sustaining the growth of the sector.
Moreover, whilst the interest of Russian clients has almost completely disappeared and that of the Polish market has diminished, an increase in the demand for commercial real estate from Finland, Sweden, Norway and France is on the rise.
"The problem is that this stock is not infinite and it is important that the administrations facilitate the construction of new developments so that there are no major mismatches between supply and demand that could lead to a spike in prices."
As far as the profile of buyers is concerned, the highest demand is for second homes, both from foreign and national clients and that "the sale of properties destined for permanent residence has been completely stagnant for some time now".
According to the experts, the future of the sector – one of the main economic engines in the province and in Spain as a whole – now depends to a large extent on how the conflict in Eastern Europe develop, and it's hoped "the economic consequences do not last for too long".
You might be interested in: The impact of the Russia-Ukraine conflict on your financial investments
Image: Archive
staff.inc.ali
Sign up for the Spanish News Today Editors Roundup Weekly Bulletin and get an email with all the week’s news straight to your inbox
Special offer: Subscribe now for 25% off (36.95 euros for 48 Bulletins)
OR
you can sign up to our FREE weekly roundup!
Read some of our recent bulletins:
Discount Special Offer subscription:
36.95€ for 48 Editor’s Weekly News Roundup bulletins!
Please CLICK THE BUTTON to subscribe.
(List price 3 months 12 Bulletins)
Read more stories from around Spain:
