Murcia’s Agricultural Sector Leads Property Boom

There has been some much vaunted talk of an economic turnaround in Spain, not least from Finance Minister Luis de Guindos who announced in January that the pace of recovery picked up in the final quarter of 2013. Although, de Guindos has responsibility for the whole of the Spanish economy, there have been some noticeable areas where there upturn seems to be stronger than others. In Murcia, which lies in the south west of the country, for instance, there has been a stronger than expected recovery in farming – something that remains an integral part of the local economy. This, it should be said, has also been linked to a modest rise in property prices and renewed interest from foreign investors. Given that any Spanish property recovery is nascent at the moment, hot spots like Murcia need to be underpinned by something solid if they are to bee sustained in the middle and the long term. And unlike other regions in southern Europe, Murcia appears to have that economic foundation.

According to the region’s agricultural organisation, known as ASAJA Murcia, there has been a boost in the production of both fruit and vegetables. The organisation is now calling for more of the region’s farmland to be given over to these crops because of the success they have had exporting to the Russian market. Many Murcia-based economists and farming experts now see this as the priority area for the region’s horticulture. Indeed Alfonso Galvez Caravaca, Secretary General of ASAJA Murcia, has already gone on the record as stating that the Russian market has the potential for stunning growth and that the consumption of fruit and vegetables – grown in Murcia – by Russian nationals shows now signs of slowing down. He said that he believes that it would be possible to boost exports of this sort of produce over the next three years of anything up to 20 per cent.

With the agricultural sector of the economy in Murcia finding new markets and leading something of a boom, it is little wonder that there has also been an upturn in the fortunes of the property market, regionally. Estate agents and property investors have noted that this is not just a phenomenon that relates to the seaside resorts, led solely by tourist investment. Rather, it is a region-wide trend that extends to Murcia’s villas, apartments and other types of property. For many investors, Murcia has sufficient luxury villas and apartments available to pick up at relatively low prices to remain a centre of interest. As the economy continues to recover, led by a sustainable growth in agricultural output and foreign exchange earnings from places like Russia, then who knows where Murcia property prices could ultimately end up?

For the time being farmers and horticultural producers in the autonomous region remain confident of future growth and stress that the opportunity for a sustained recovery remains in their own hands. According to Caravaca, it is essential for Murcia to consolidate the agricultural sector’s sales and distribution channels to Russian. ASAJA Murcia are already talking about developing further promotional campaigns in Russia, including product tasting in places such as Moscow, St. Petersburg and Minsk. The idea is that Russian consumers will become more familiar with the region’s fruit and vegetables in the same way that EU citizens already are.

With such positive talk of Murcia’s future exchanges with Russia it might also be easy to overlook another eastern-led factor which has been impacting on property prices, there. Russian tourism to southern Europe has been growing rapidly in the last ten years or so and Murcia, in common with other coastal regions in the Mediterranean has seen more of them than perhaps ever before. Russians have been attracted to Murcia’s pleasant climate, it is fair to say. However, they have also been purchasing holiday property in the region, particularly at the luxury end of the market. This had previously been the reserve of western Europeans, including many Brits and Germans, who wanted to own a place in the sun. However, now Russians are added into the mix, the chances of a boom in Murcia villa prices only looks more and more likely.