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

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

Spain’s leading developers urge government to introduce mortgage interest tax relief on holiday homes

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

An introduction of mortgage interest tax relief on holiday homes could stimulate demand and cut the oversupply of unsold holiday homes at the costas, says the G-14 association of Spain’s leading property developers.

They are urging the government to adopt new measures to deal with the crisis in the holiday homes market. The Spanish government has reintroduced mortgage interest tax relief on main homes, even though experts warn that homeowners occupying their properties will be better off, while tenants renting a home will suffer, a measure that makes it far more difficult to get the rental market moving into the right direction again.

Quoted in the Spanish press recently, Antonio Carroza of rental company Alquiler Seguro said this request is nothing short of “irresponsible”, since public money would be used to effectively subsidise large-scale developers to finally shift second homes that should never have been constructed in the first place. Such mortgage interest tax relief should only be extended to resident Spaniards, not foreign investors who purchase holiday homes in Spain.

The G-14 association also urged the Spanish government to cut ITP sales tax on resale properties, a move that would help private vendors.

SOURCE: www.spanishpropertyinsight.com

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Sales volume for Spanish property transactions rises by 27%

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

The new Spanish government, led by the People’s Party, made a number of decisions on how to kick start the property market that have led to a scramble among foreign investors to snap up property bargains in the New Year.

At the end of 2011 international property investors came back to the land of sunshine and Sangria to boost the annual sales volume to €3.6 billion, representing a 27% increase in a year-on-year comparison. What started as a trickle of potential buyers at the beginning of January soon transformed into a positive flood in parts of Spain, where lenders and cash-strapped developers tried to lure buyers to their doors with hugely discounted properties and excellent finance deals.

Spain’s government cut property purchase tax by half, now standing at just 4%. The devaluing of the Euro against Sterling helped also to reduce asking prices by up to 50% and produced mortgage deals with up to 107% loan-to-value offers. International buyers were quick to spot various surveys listing property super sales.

A considerable number of buyers clearly felt that prices couldn’t go down any further, reserving their chosen properties either by internet or making appointments to view them post haste.

A bank-owned property development based in Costa Almeria saw the bank’s reservation system for viewings virtually collapse under the onslaught of potential buyers wishing to make appointments for their chosen properties. Online property portal Propertyinspain.net had nicknamed the development “best key-ready buy”, which no doubt added to the bargain hunters’ frenzy.

Within the space of a week there were multiple buyers lined up for viewings on waiting lists spanning several days, while the banking staff wrestled with a mountain of mortgage application paperwork and tried to allocate reservations to the correct property and potential buyer.

Their system allowed the bank to skip from one failed applicant to the next one in line on their waiting list, using the bank’s lending criteria as the basis for weeding out the unsuitable applicants.

One plucky South African buyer can hardly believe his luck, after having selected via Google and Skype street view and having patiently waited for several days, he eventually got the third penthouse, he’d chosen for just €62,000. The property is a brand new 2-bedroomed pool and sea view penthouse, includes all appliances and has a choice of no fewer than 4 swimming pools.

The most sought after properties in this super sale were the newly built, key-ready penthouses that have rooftop solariums together with either sea views and/or stunning views over four communal swimming pool areas. The €62,000 price tag is for 2 bedrooms, fully-fitted kitchen with appliances, air conditioning and secure parking. Buyers only need a €6,000 deposit to secure the deal.

The properties were discounted by 50% by the bank who owns the penthouses. The properties come complete with guaranteed 90% mortgage deals.

SOURCE: www.propertyinspain.net

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Real estate market declined further in third quarter

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

According to data published by the Spanish Government (Fomento), sales of Spanish property declined in a year-on-year comparison by 6.3% to just 75,462 sales in the third quarter this year.

While this may seem depressing news at first glance, it is nothing compared to the fall seen in the first 2 quarters of 2011, when a 30.4% fall was seen in the first quarter and an eye-watering 40.8% decline was recorded in the second quarter of the year. Some members of the Spanish press have chosen to put a rosy glow on this latest result, El Pais being one of them.

The sales result of the third quarter was undoubtedly influenced by the government’s announcement of new measures to boost the real estate sector, such as the reduction of VAT on purchases of new properties, down from 8% to 4%. It hardly bears thinking about, what would have happened, if there hadn’t been such incentives!

Although it is important to take the quarterly figures published by the Department of Housing in the Ministry of Public Works into account, the monthly data released by the National Statistics Institute (INE) are far more reliable as a true reflection of the property market situation across the country. Their figures, which exclude social housing, show no improvement of the real estate sector whatsoever for the third quarter.

The Property Register, another valuable source of accurate data, reported a 32% decline in property prices for the third quarter this year.

Bearing in mind that lending to new mortgage applicants has come to a virtual standstill, it is highly unlikely that the Spanish property sector will see any significant improvements in the final quarter of 2011.

While overall the figures suggest that things are still grim across Spain, there is reputedly evidence that shows some areas are more recession proof than others and luxury, high-end properties in some of the most sought after regions have fared far better than the average property has.

SOURCE: www.spanishpropertyinsight.com

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Number of property enquiries for Spain is rising

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

According to figures collated by the Overseas Guide Company (OGC) there appears to have been a 60% increase in enquiries for information about real estate in Spain, a fact Fly2let was quick to publish.

Elaine Ferguson, client relationship manager at OGC’s research facility, said that Spain had suddenly taken off again, receiving the second largest share of enquires from thousands of people considering an overseas investment.

Budget appears to be the key issue with many potential buyers, said Richard Way, editor at Overseas Guide Company, when he spoke to the website’s proprietors. In his opinion countries like Spain are prospering in the survey because of their accessibility by air from the UK and thanks to the affordability of travel.

Anna Nicholas, journalist and author, stated earlier this month that anyone wishing to buy abroad should visit the country of their choice several times and at different times of the year, before making a purchasing decision, since a holiday home might be fine in summer, but may not meet one’s expectations in winter.

SOURCE: www.propertyshowrooms.com

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Marbella’s real estate is not likely to lose in value

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

Industry experts International Property Success believe that the value of Marbella’s properties won’t fall any further thanks to the increase in overseas investor interest from countries like Russia, the UK and the Middle East. Indeed, the company believes that property prices have bottomed out.

The wonderful year-round climate and the glamour a resort like Marbella has to offer to property investors and those seeking a holiday home has insulated Marbella to a large extent from the kind of price drops that were seen in other parts of the country. Marbella still ranks are as one of the country’s top resorts.

Mr Michael Corry Reid, a spokesperson for Aylesford real estate agency based in Marbella, stated that the high-end, luxury part of the Spanish property market was doing well and that such properties in Marbella were particularly attracting enquiries from overseas buyers.

International Property Success highlighted the need for potential investors to research the location of their new property thoroughly before buying, as the Spanish real estate market is still fluctuating wildly. They also stressed that there were few other places in Spain that had as much potential as Marbella.

SOURCE: www.propertyshowrooms.com

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Spanish retail property sector falls further

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

For a third time in as many quarters this year the Spanish retail property sector experienced a decline.

According to figures released by BNP Paribas Real Estate, Madrid’s retail sector has been forecast to have the lowest activity for 2011 as well as 2012 among all its European counterparts.

With the Spanish economy being in such a slump, occupiers struggle far too much to move to new rental premises or purchase new ones. As a consequence, rents across Spain are falling.

In Madrid’s Calle Serano – Calle Ortega y Gasset district rental income fell by 4% in the second quarter of 2011 in a year-on-year comparison, BNP’s study revealed. Overall, investment volumes declined by 2% in Spanish retail property sector during the period from July to September 2011, compared to the same period in 2010.

Like some of its European neighbours, Spanish hotel investment sector, covered by another BNP survey, also declined during the first 6 months of this year.

BNP Paribas Real Estate closed their findings with a ray of hope for the second half of 2011, stating that the potential sale by Hotasa of a cluster of their hotels was destined to enhance sales levels.

SOURCE: www.propertyshowrooms.com

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