Foreigners dig deep for Barcelona real estateIn the past few months, the first signs of a recovery – or at least a bottoming out – of Barcelona’s market have begun to appear. After falling 34.9 per cent from their 2007 peak, prices for city residential property fell only 1 per cent in 2013, according to, Spain’s largest property website.

And of the 11 districts in Spain that saw price rises in 2013, nine were in central Barcelona, says Beatriz Toribio, head of research at, another Spanish real estate portal.

The city attracted €1.32bn in commercial property investment in 2013, 116 per cent more than in 2012, according to Patricio Palomar Murillo, director of research and investment strategy at CBRE Spain.

Jordi Badia Llorens, chief executive of Emin Capital, a local real estate private equity fund, says: “The Barcelona property market is unsettled, as is the rest of Spain. But from the point of view of investors, either institutional or individual, it is a good time to bet again, as prices make sense.

“They will rise, but not to the levels of the past.”

His fund just bought Barcelona’s iconic Torre Agbar for a reported €250m.

But the market has its peculiarities. Because there is almost no home loan credit market in Spain – the number of mortgages granted fell from 1.2m in 2007 to 198,000 in 2013, according to Spain’s National Statistics Institute, (INE) – approximately two-thirds of sales in Barcelona are cash deals, says Idealista co-founder Fernando Encinar.

This, combined with high local unemployment, tilts the market towards foreign investors, rich locals, and private equity funds.

“The real movement is at the higher end luxury market, and it’s driven by international clients,” says Alex Vaughan, who co-founded Barcelona’s Lucas Fox realtor. Lucas Fox closed 120 deals last year averaging just under €1m each, Mr Vaughan says; 90 per cent of buyers were foreign. For individuals, the price drop has made Barcelona an attractive place to set up home.

Enrique Lacalle, president of Barcelona Meeting Point, a real estate convention, says: “A lot of people in Barcelona work in London and beyond, because of the airport’s good connections. Barcelona has a great climate, is well connected with Europe and the world, and is very cosmopolitan.”

Five years ago, the convention added sessions aimed at Russian buyers and in 2013 ones tailored to Chinese buyers.