Owning a holiday home still ranks as a ‘good investment opportunity’ with general public

Posted on June 27th, 2012 in Real Estate in Spain by author

The editor of A Place in the Sun magazine, Liz Rowlinson, stated recently that many people would still consider buying a holiday home abroad, either in Spain or other prime location in continental Europe, a good investment, especially when seen in comparison to other investment options.

Potential buyers had become very streetwise with regard to the expected returns on their investments and had become more wary of the costs involved in purchasing as well as owning a holiday or investment home.

Liz Rowlinson had to admit that a recent report published by Homeaway.co.uk had revealed some 65% of holiday homeowners were contemplating selling their overseas homes, but she asserted that second homeowners often considered putting their overseas assets on the market, when the economic climate got tough and explained that this was a symptom of the financial woes affecting the Eurozone at present.

SOURCE: www.propertyshowrooms.com

Property market in Spain continues to perform poorly

Posted on June 27th, 2012 in Real Estate in Spain by author

Official figures released by Fomento, the Spanish government source, reveal that property values across the country fell by 37.5% last year compared to 2010. Excluding social housing, the country recorded a total of 307,931 house sales in 2011, representing an overall value of €50.5 billion.

The Property Register quotes slightly different figures but still shows the same depressing picture. According to the Property Register – 370,204 home sales including social housing took place in 2011. That means the Spanish housing market is now at its most contracted since the Property Register began releasing figures in 2005. In the final quarter of 2011 sales transactions declined by 11%.

The Property Register also revealed that only four regions control the property market: Andalucía, Catalonia, Madrid and the Valencia community have cornered nearly two thirds of the entire sector. Anyone researching figures on the Spanish property market should remember that global figures are not really representative of the actual picture in the country.

According the latest Asking Price Index published by Idealista.com, a leading property portal, asking prices for second hand homes and resales declined by an annual 3.4% during the first 3 months of 2012.

Fernando Encinar, head of research at Idealista.com, explained that the difficult lending situation and latest legislation introduced by the government to put pressure on banks and the property sector to continue with the strategy of making housing more affordable, has resulted in property prices sliding further downwards, a trend that is set to continue until the end of 2012.

“Today you can find homes at prices that seemed unthinkable, especially from the estate agents that are getting the best discounts in the market,” Mr Encinar added. Existing homeowners may be suffering thanks to lower asking prices, but newcomers into the market are happy about the greater affordability of homes.

Fomento’s figures also reveals that new planning approvals declined by 31% per annum in January with just 4,698 approvals being granted. Could this trend spell the end of the construction industry in the country? Once house builders were the driving force behind the Spanish economy, now they are at their wits’ end of how to stay afloat.

Meanwhile, BBVA, one of the country’s largest banks, has predicted the Spanish housing market will continue to contract with house values declining until at least 2013. Sales transactions are also predicted to decline by an additional 20% and house prices are to drop by another 15%, before the market has finally adjusted to rock bottom.

SOURCE: www.spanishpropertyinsight.com

Murcia’s new Paramount theme park project is well on the way to becoming reality

Posted on June 27th, 2012 in Real Estate in Spain by author

Finally, the deal securing the construction of the Paramount Studio theme park in the Spanish region of Murcia has been signed off by promoters Proyectos Emblemáticos Murcianos (PREMURSA). They will pay two thirds of the purchase cost for the land needed to construct the theme park. An estimated €10.3 million will change hands for the land deal.

Having the signatures on the paperwork marks an important stepping stone in the creation of Paramount’s very first theme park and lifestyle centre based in Europe. Everyone involved in the housing market is hoping for a positive outcome and a transformation of Murcia thanks to the theme park, not least of all local estate agents, who are still reeling from the latest property sales figures recorded in January 2012.

Data published by the Spanish National Statistics Office show that the sales volume dropped by 26.3% in January in a year-on-year comparison. Many experts and homeowners are anxious at such news, fearing the crisis affecting the residential real estate sector is worsening. Sales transactions have fallen for 11 consecutive months now with just 33,087 properties changing hands in January (a drop of 26.3% per annum).

There’s always a silver lining though – compared to the number of sales transactions recorded in December 2011 the results for January actually represent a 42.3% boost in sales. A total of 347,305 Spanish properties were sold in 2011, representing a 29.3% drop compared to the previous year. Despite recovering briefly in 2010, sales volumes have continued to fall since the peak of the housing market in 2007.

The MIPIM international property show held in Cannes had property experts musing over a better outlook for this year, since the price cuts for Spanish homes has now been so significant, it is likely investors are going to come back with renewed interest in the Spanish property market.

SOURCE: www.property-abroad.com

Number of sales for Spanish real estate rose in January 2012

Posted on May 2nd, 2012 in Real Estate in Spain by author

Seen year-on-year the volume of Spanish sales transactions may still be down by 18.6% compared to the same period in 2011, but the number of completed sales rose in January in comparison to the previous month.

The latest data from the Spanish National Statistics Institute (INE) confirmed that the number of transactions for real estate rose by 42.3% in January of this year compared to the final month of 2011.

Interestingly, the INE’s report stated that only 13.8% of all transactions were registered for rural properties, showing that urban properties are what attract buyers these days.

They also seem to be in favour of new versus old, with 54.1% of sales transactions being for new build homes.

In the holiday lettings segment of the market Spain is also showing some improvement, said INE’s report. The number of holidaymakers opting for the self-catering property type rose by 4.7% in January this year, compared to the same period last year.

Buyers looking for an investment opportunity should take advantage of the low Spanish property prices now, especially with rising number of tourists expected to visit Spain this year.

SOURCE: www.propertyshowrooms.com

Murcia increasingly of interest to property buyers

Posted on May 2nd, 2012 in Real Estate in Spain by author

One property market expert said more enquiries about Murcia real estate were being received than for other property markets such as Portugal or the United Kingdom.

Jon Ainge, director of International Property Success, commented how the proposed theme park Paramount Studio were building was beginning to work its magic, especially now since construction on the site is to start in May 2012. “We expect demand for property to increase as a result,” Jon Ainge added. While Murcia is undoubtedly a great location for investment, he cautioned buyers to look for the best locations for their investment, such as 5-star resorts, rather than be swayed by apparent bargains.

The theme park has potential to cover about one million square meter area of land, which the developers have so far purchased and what will be a major tourist attraction in Murcia is scheduled to open its doors to the public early in 2015. The Paramount theme park is to have more than 30 attractions and 2 on-site hotels with a business and leisure complex being planned to be constructed on an adjacent site.

SOURCE: www.propertyshowrooms.com

Spanish property market will see an upturn this year

Posted on April 19th, 2012 in Real Estate in Spain by author

Commenting on the real estate trends of 2012, CBRE’s president Mr Eduardo Fernandez-Cuesta expressed his organisation’s views that transactions for the property market this year will show an increase compared to 2011, but warned that home values would continue to undergo a downward price adjustment.

The CBRE president made his predictions during a presentation on trends in Spain’s real estate market and said that the most sales transactions currently being registered were those for properties with price tags of between €100,000 and €120,000, where 100% finance packages were offered as part of the deal.

Basing his comments on his company’s survey of 200 industry professionals, Mr Fernandez-Cuesta added that 90% of those questioned predicted sales prices for residential properties would decline further, however, the same experts stated that Madrid and Barcelona had pretty much reached their bottom level in the current price adjustment.

Discussing the individual segments of the residential sector, the survey showed that new housing developments would continue to suffer, while refurbished existing homes and the rent-to-buy sectors would fare much better this year.

CBRE’s president highlighted the need for a recovery of the property market to take place soon, as banks and other financial institutions needed to tidy their balance sheets and rid themselves of unsold assets.

He added that public spending cuts in the light of the Government’s austerity measures would have an impact on the management of civic property assets used for administrative purposes. Adolfo Ramirez-Escudero, CEO and consultant of the company, explained this point further. Of the 200 industry professionals questioned, 95 % stated that such municipal bodies are not making the most of their real estate assets.

The survey showed that 91.8% of property experts estimate financial institutions are also not making the most of the property assets in their possession, while 60% of experts believe that banks will add to their real estate portfolios this year rather than divest of housing stock.

Seen on a business by business sector basis, experts believe that the office market will attract more investment than the retail sector, closely matched by the residential and industrial real estate sectors.

Looking more closely at the subject of investment, the study suggests that 53% of experts questioned believe the opportunistic funds market will be looking to invest more on a higher returns basis, with the remainder coming from private investors (20%) and institutional investors (13%).

The survey also revealed that the predictions for real estate organisations outside of Spain included an upturn for hotels with the fastest growth predictions and the office market as the most likely to be of increased interest to overseas investors.

El Economista reported that the survey further revealed an upturn of the real estate market would go hand in glove with a reduction of unsold real estate currently on the market. Some 50% of experts questioned believe that this year far more properties will be sold than last year, predicting that this would affect all sectors with the exception of the logistics real estate market.

SOURCE: http://news.kyero.com

Newly built homes’ values to fall further this year

Posted on April 19th, 2012 in Real Estate in Spain by author

Cincodias.com reported that the Spanish government predicts the asking prices for newly built homes will fall further in 2012, bearing in mind that nearly 65% of all housing surplus is located at the Spanish costas. The lack of available credit and stagnant labour market has made it more difficult to reduce the number of empty new homes on the market.

The most dramatic price adjustment will be reserved for the 800,000 purpose built holiday and second homes, which are mainly located at the Mediterranean coast.

A recently published study conducted by Cataluña Caixa suggests that two thirds of unsold, and seemingly unwanted housing stock were constructed in coastal areas, ore more precisely, some 65% of such homes were built in Andalusia, the Balearic Islands, Catalonia,  Murcia and Valencia.

The latter is the worst affected region with nearly 210,000 unsold homes still on the market at the end of September 2011, which reflects 25.6% of the total unsold housing stock. Seen in combination with 137,000 unsold homes in Murcia and 107,000 unsold properties in Catalonia, this represents a 55.4% share of the overall unsold surplus.

Worrying still, while the overall availability of new housing stock may have reduced down over the past couple of years, in the Basque Country, Catalonia and Valencia more newly built homes have come onto the market.

Seen on a province by province basis, Castellón is showing a volume of almost 114,000 empty homes, whereas Alicante and Barcelona recorded 57,000 unsold newly build homes respectively. Murcia recorded another 52,000 unsold properties and Valencia registered some 40,000 newly build, unsold properties.

SOURCE: http://news.kyero.com

Office market in Spain will remain stagnant until 2013

Posted on March 31st, 2012 in Real Estate in Spain by author

Commercial real estate experts Savills believe the office market in Madrid won’t show an improvement until 2013, although the beginning of 2012 has been encouraging.

Savills believe that investment in Spain’s commercial real estate sector will be hampered by a lack of demand for office space and a distinct shortage of trust in Spain’s economy picking up any time soon.

Gema de la Fuente of Savills’ Research noted that growth in Spain was likely to remain “muted until 2013”, adding that, as overseas investors were concentrating on  retail, the domestic market would be more likely to control the office market in 2012.

Among the few highlights in Spain’s commercial property market was the sale of Torre Picasso in Madrid. With 43 storeys Torre Picasso ranks as one of Madrid’s tallest skyscrapers, using most of the space as offices. The office development changed hands for €400 million / £338 million at the beginning of this year and Savills confirmed that this particular deal accounted for 10% of the total volume of transactions brought to completion by the end of 2011.

The buyers are Pontegadea Inmobiliaria SL, an investment company founded by Zara’s Amancio Ortega. The intention to sell was announced at the very end of last year, when construction company Fomento de Construcciones y Contratas made the deal public.

SOURCE: www.propertyshowrooms.com

Getting a foothold on the Spanish property ladder with distressed properties

Posted on March 31st, 2012 in Real Estate in Spain by author

Not every investor has access to large funds to start their property portfolio. Distressed properties in Spain present would-be investors with an ideal opportunity to get in on the buy-to-let or holiday-let market.

Jon Ainge, director of International Property Success, pointed out that, while banks have introduced far stricter lending criteria, which have made funding a property problematic for some investors, they are willing to advance mortgages on Spain’s distressed properties. Recently introduced legislation forces Spanish banks to shed the glut of properties on their books in order to reduce their exposure to under-performing assets.

Jon Ainge explained: “If banks currently finance a development they are keen to deleverage themselves of the current risk they hold – this is where you will find that most loans are not being issued in countries such as Spain.”

The recently published Global Distressed Property Monitor by the Royal Institution of Chartered Surveyors revealed that increased demand for distressed properties had occurred in the last three months of 2011, far more than in the previous quarter.

Industry experts forecast roughly the same number of distressed Spanish properties would enter the housing market in the first quarter of 2012 than there had been listed in the previous quarter.

SOURCE: www.propertyshowrooms.com

A Retirement nest egg with Spanish property?

Posted on March 31st, 2012 in Real Estate in Spain by author

With the latest budget having been announced in the UK many people are looking at different options to boost their retirement funds – how about making Spanish property part of the retirement fund?

Jon Ainge, the director of International Property Success, believes that using Spanish property with capital growth and holiday rental income potential to boost retirement portfolios is not a bad idea.

“I believe the returns from overseas property, particularly in locations like the Caribbean, the Algarve and Spanish coast can help fund retirement and should be part of a pension portfolio,” Jon Ainge explained.

The idea of buying real estate in Spain has of late interested far more British people than before. Liz Rowlinson, the editor of A Place in the Sun magazine, observed that falling house prices have made Spanish homes more affordable, while at the same the traditional factors of great amenities, warm sunny climate and beachside holidays are still as appealing as ever.

SOURCE: www.propertyshowrooms.com

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