Madrid

The Real World

With constant improvements in 3D-rendering and virtual reality advancing the metaverse experience, real estate developers and agents can put such tools to work selling upscale residences—especially those yet to be built.

As luxury homes remain in high demand, with construction slowed by labor and material shortages, more buyers are investing in what will be built as long as a year or more in the future. Agents can offer a virtual walkthrough of a home—highlighting amenities, offering bespoke options and demonstrating decor possibilities.

In addition to making the traditional printed real estate sales brochure all but obsolete, another advantage of 3D rendering and VR tech is that the sales exploration experience for buyers at home becomes the same as for shoppers touring the property itself.

Potential buyers can sit in front of their own computers and explore the virtual imagery of their home of the future— with the option of inviting the realtor to guide the experience via video-conferencing software. The combined effect takes the concept of the traditional house walk-through with the real estate agent, and conducts it in the metaverse space.

“People have the desire to express their individuality and character through these luxury items in the real world. A digital Rolex, ensured by NFT, will have the same status as a real-life Rolex. You are what you own.”

ROLF ILLENBERGER

Managing Director VRdirect TOP MARKETS

Remote work opportunities have led to more international investment in Madrid.

A Post-Covid-19 Lockdown Luxury Boom

As foreign investors flock back to the city, Madrid’s luxury real estate market has experienced a post-Covid-19 lockdown boom, according to Bruno Rabassa Roig, CEO of Berkshire Hathaway HomeServices Spain.

“More foreigners are moving to Spain to take advantage of remote working at a location that better suits their lifestyle,” Mr. Roig said. Easy access via air, a high-speed train network, and a lower cost of living also add to the allure for foreigners. Not to mention that those who had their money in U.S. dollars have been greatly favored by the current exchange rate.

Mr. Roig expects a continued increase in foreign investment over the coming year, especially from South America, due to the tumultuous political conditions there. The Golden Visa program in Spain—which allows for citizenship with real estate investment— along with the recuperation of the tourism industry should support the upward trend.

Local buyers have placed additional importance on properties with outdoor space and a home office after the past few pandemic years, but higher prices are making that more of a challenge.

“Prices have increased 30% in certain spots,” Mr. Roig said. “Today, it’s a seller’s market with low inventory. We also have very low production of new homes due to the notable increase in construction costs,” Mr. Roig said.

In Madrid, the neighborhoods of Barrio de Salamanca, Chamberí and Justicia are especially popular, and have very low inventory. According to Mr. Roig, properties listed in these areas sell very fast for the right price, which can be up to €18,000 per square meter.

“Sales from the first and second quarters this year are higher than the same period last year because, despite higher interest rates, buyers can still take out mortgages at reasonable fixed rates,” Mr. Roig said.

The best advice on how to purchase your luxury dream property in Madrid, Mr. Roig said, is to work with an expert who understands the market’s nuances. “It is the secret to a successful deal for all parties,” he said.