Madrid Property Sector Fastest Growing as Moody’s Predicts 2.5% GDP Growth in 2018

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“Economic conditions will remain healthy in Spain, where GDP growth will reach 2.5% in 2018,” the agency notes in a report on the evolution of the retail sector in Europe.

Thus, Moody’s latest forecasts for the Spanish economy for 2018 are half a point above their previous estimate, although they imply a slowdown compared to the 3% expansion expected in 2017.

Likewise, the agency is confident that high unemployment in Spain will follow the downward trend of recent years and fall to 16.8% in 2018.

“This will support the income of Spanish retail companies,” notes Moody’s, warning that the outcome of the recent referendum in Catalonia may have some effect on revenues, but adds the difficulty of estimating the magnitude of this impact by the moment.

Moody’s plans to update its assessment of Spain this Friday. The risk rating assigns a ‘Baa2’ rating with a stable outlook on Spanish long-term debt.

Moody’s Prediction on Spain’s Housing Market

Earlier this year Moody’s has stated that they expect Spain’s property prices to grow at a pace similar to 2016, which was 4.7%. They expect overall growth to slow but still remain at a healthy rate of 2.3% as the housing market continues to recover.

Second-hand units have been the major factor for rising property sales with the highest growth on the coastal areas and Madrid and Barcelona.