Monthly Archives: December 2009

Property bargains continue in Spain and Tenerife

December 23, 2009 – 1:34 pm
Property bargains remain in Tenerife and Spain

Property bargains remain in Tenerife and Spain

Property bargains are likely to continue in Spain and Tenerife now one of the few Eurozone countries still in recession after it emerged that the Republic of Ireland has seen a return to economic growth.

Spain and Greece are now among the few users of the euro still in a downturn, while the UK is the only G20 country still in recession.

Those keen to invest in the Spanish real estate sector may wish to take advantage of the lower prices and many Spanish bank repossession property evident greater weakness of its economy to pick up bargains in 2010. Hard pressed developers are offering big discounts on key ready homes.

However, those hoping for a Spanish economic turnaround to help property investments gain in value will have noted that this fall followed declines of 1.1 per cent, 1.3 per cent and 1.1 per cent in the previous three quarters.

By Angela | Posted in Economy, General, Holiday, Inspirational, Miscellaneous Articles, Property, Tenerife, Things to Do, Uncategorized | Tagged , , , , , , , , , | Comments (0)

No place like home?

December 21, 2009 – 4:30 pm
The strong euro has changes plans for those living and wishing to live in Tenerife and Spain

The strong euro has changes plans for those living and wishing to live in Tenerife and Spain

It seems there really is no place like home. New research has discovered that UK expats are returning home in their droves as the weak pound has sent the cost of living in the Eurozone soaring.Over the last year, there has been a huge rise in the number of expats living in Europe looking to return home to the UK.

Research  for home-movers, has seen an uplift in demand for removal quotes from those expats wanting to relocate back to the UK – a big turnaround from the exodus of Brits in recent years to enjoy warmer climes and cheaper property prices elsewhere. The number of people requesting quotes to move to the UK has increased by 37 per cent, while there has been an 18 per cent decline in the number of people moving from the UK to the continent in the space of a year

Spain has  seen an exodus in the past year, with a 39 per cent increase in the number of quotes to move to the UK. Traditionally the most popular haven for British expats seeking to retire in the sun, Spain has suffered from a devastating property crash, leaving many owners with depleted equity and high living costs due to UK pensions being paid in pounds not euros.

Many expats have had their dreams shattered by the current economic crisis and are finally realising that they can no longer afford to live in Europe with the weak pound. For those who kept their options open by retaining a property in the UK the situation is not so desperate but for many who sold up completely and are now unable to sell their European home, their only option is to rent back in the UK.

We have seen a sharp decline in the number of people moving out to the continent in the past twelve months as a result of the weakening pound and stretched finances in the UK. This has resulted in many would-be expats putting their aspirations of retirement in the sun on hold until the markets recover.

By Angela | Posted in Economy, General, Holiday, Inspirational, Miscellaneous Articles, Property, Tenerife, Things to Do, Uncategorized, Weather | Tagged , , , , , , , , , , , , , | Comments (0)

Searches for international property double

December 17, 2009 – 12:51 pm

 

In Spain, Tenerife and the Canary Islands, property searches are beginning to increase once more.

In Spain, Tenerife and the Canary Islands, property searches are beginning to increase once more.

The number of searches for international property in November 2009 was double the level of November 2008, signaling that this sector may have turned a corner.

Primelocation International recorded over one million foreign property searches in November, taking interest back up to pre credit crunch levels. Almost one third of searches were carried out for property in Spain, Tenerife and the Canary Islands which has overtaken rival France to become the most popular country after twelve months in second place.

The pent up demand for second home and investment purchases is likely to spill over into increased activity and sales next year if an economic recovery causes the pound to rally.

After a sustained period of rising interest in international property as a whole, I think we can be confident that foreign property purchase is now back on the agenda, in spite of certain barriers such as exchange rates and finance, which may be continuing to stall actual sales.

The total number of searches is almost on a par with pre credit crunch levels and, as the health of the economy continues to improve and consumer confidence returns, we could see a marked increase in market activity next year and a long term stabilisation of prices.

By Angela | Posted in Economy, General, Holiday, Inspirational, Miscellaneous Articles, Property, Tenerife, Things to Do, Uncategorized | Tagged , , , , , , , , , , , | Comments (0)

Opportunities still exist in Tenerife and Spain’s property market.

December 14, 2009 – 4:05 pm
Opportunities still available in Tenerife, the Canary Islands and Spain

Opportunities still available in Tenerife, the Canary Islands and Spain

We think there are  good investment opportunities in Spanish  and Canarian real estate today, but some are risky. In three years we’ll probably be kicking ourselves for not advising more investors to invest now. There aren’t many opportunities in commercial real estate because there isn’t much product and rents haven’t yet adjusted. In residential, on the other hand, the correction has been very strong and fast. The ideal profile now is an opportunistic investor buying properties off banks by taking on the existing debt, a type of real estate venture capital.

There are hundreds of thousands of possible transactions, but not so many genuine opportunities. What there is not is any financing, so anyone who wants to take advantage of this market has to take the debt with the asset.

House prices touched bottom some time ago, they had to fall. The price of land has fallen faster than house prices although it could even fall a bit more.  In the US and the UK prices have fallen around 20% from the peak whilst here we have only fallen by 8%. Valuations appear to be down 30% in 2 years.. One has to look at real property transactions and a survey of developers to see not only their asking prices but how far they are prepared to drop prices to sell.  Quite a few homes are being sold more than 200,000 homes a year in fact. What is not selling is off-plan, as there you take the risk of the developer or builder going bankrupt? It’s a good time to buy newly built homes with Euribor at 1.24%. They won’t be any cheaper next year. And when prices start to rise they will do so at a rate of 10% per year. Perhaps that purchase in Tenerife should be made sooner rather than later!

The residential sector is already recovering, just not the developers, who won’t see the light at the end of the tunnel for three years; it is very bleak for them. We believe that developers have dropped their prices to the minimum.  The recovery is underway, although this won’t show up in the official statistics until the first half of 2010. As soon as there is a general perception that things are getting better, house prices will stop falling and start rising.

By Angela | Posted in Economy, General, Holiday, Inspirational, Miscellaneous Articles, Property, Tenerife, Things to Do, Uncategorized | Tagged , , , , , , , , , , , , , , | Comments (0)

Problems with the property market in mainland Spain

December 12, 2009 – 4:53 pm
Problems remain in Spain's property market

Problems remain in Spain's property market

The residential property market in Spain has not yet reached the  bottom and could drop another 27% in 2010, according to a new report.

Overall property transactions in 2009 dropped by around 41% compared with 2008, the report by Spanish property consultants and analysts Aguirre Newman, also shows.

The report, Coyuntura Global del Mercado Inmobiliario Español, also warns that bank valuations continue to overestimate the true worth of property in Spain.

In the report analysts says that there is no easy solution to the problem other than a substantial overhaul of Spain’s banking regulations to ensure future house valuations are done at a more realistic level.

It also warns that the housing market in Spain will remain depressed while banks continue to sell off huge stocks of repossessed homes and regional authorities continue to finance the purchase of unsold homes with government grants, such as Andalucia’s 2010 plan.

“Current home price estimates do not reflect true market values. Banks and real estate companies that own or have financed unsold new homes will have to accept price cuts of around 27%,’” said Javier Garcia-Mateo, director of analysis and investigation.

However, the report does expect office and retail rental prices to stabilise in 2010, ahead of any possible recovery in 2011.

The housing slump tipped the Spanish economy into the worst recession in 60 years, and Spain’s unemployment rate is the highest in the European Union. Home sales fell about a third in the 12 months through September, the latest government data shows.

Real estate companies including Martinsa-Fadesa have filed for protection from creditors in the past 18 months after falling behind on debt repayments when the market collapsed.

By Angela | Posted in Economy, General, Holiday, Inspirational, Miscellaneous Articles, Property, Tenerife, Things to Do, Uncategorized | Tagged , , , , | Comments (0)

Banks need to become better estate agents for the market to recover

December 6, 2009 – 1:07 pm
Banks need to become better estate agents in Tenerife

Banks need to become better estate agents in Tenerife

Demonised by agents for keeping prices artificially high to avoid losses, or making it harder for agents to access distressed deals, many now feel that Spanish banks must become better estate agents if the market is to recover.
Ian Waudby, chairman of investment consultancy Crest Group International, observes that the companies set up by banks are slowly making it easier for foreign buyers and agents to access stock; but he stressed that buyers need a quicker response from these companies and a faster sales process.

“The properties need to be packaged with mortgages . The websites aren’t bad but if you try to make an offer you won’t hear anything back.”   Discounting is central to the current bank-owned property stalemate, with agents saying they’re either not big enough, or only available for too short a period of time. There aren’t enough desirable properties at the distressed prices that people want. The demand is there but even if people see their ideal property they aren’t prepared to pay for it if it isn’t cheap.

Pro-active banks that price realistically will see more profit than those who wait out the market.  The big banks such as Santander could probably sit on it for 20 or 30 years but the smaller ones can’t. There aren’t enough buyers at the moment and they may have to bite the bullet and get rid of their properties.

Most agents spoken to agree that the sooner the banks bite the bullet, the sooner the Spanish homes market will recover.

By Angela | Posted in Economy, General, Holiday, Inspirational, Miscellaneous Articles, Property, Tenerife, Things to Do, Uncategorized | Tagged , , , , , , , , , , , , , , , | Comments (0)

Marketing properties in Tenerife require the right level of exposure

December 5, 2009 – 12:49 pm

The number of holiday rental properties in Europe is increasing and the right level of exposure is essential, especially when the global economic downturn is taken into account. Property owners should make sure that they give a very detailed and interesting description of their holiday rental and surrounding area.

Market your property in Tenerife whilst long winter nights in the UK cause people to think of holidays and warmer climes

Market your property in Tenerife whilst long winter nights in the UK cause people to think of holidays and warmer climes

Owners of overseas self-catering holiday homes are reminded that the long dark evenings of winter are just the time when people think about next year’s vacation and therefore property owners should think about marketing the properties via estate agents in Tenerife.

In related news, Britons who let out holiday homes in the UK will need to maximise on lettings in 2010 as they are likely to lose their furnished holiday lettings tax relief in April of next year.New legislation, details of which are expected in this month’s pre-Budget report, are expected to outline changes to the tax rules for furnished properties available to let for at least 140 days a year and actually let for 70 days year.

The new measures could affect around 60,000 individual second-home owners, who form the core of the UK’s holiday lets market, and can currently offset the cost of furniture and fittings against tax.

By Angela | Posted in Economy, General, Holiday, Inspirational, Miscellaneous Articles, Property, Tenerife, Things to Do, Uncategorized, Weather | Tagged , , , , , , , , , , , , , | Comments (0)

Irish walk away could be great news for other expat investors in Tenerife?

December 3, 2009 – 4:40 pm
Irish walk away from Tenerife may mean more bargains for oher expats.

Irish purchasers walking away from Tenerife could mean more bargains for other expats.

A growing number of Irish property investors are walking away from their overseas property investments, following the slump in global property prices over the past two years, reports Overseas Property Mall.

Irish investors were among the most active overseas property buyers in the world during the boom years, but many have fallen into negative equity, particularly those who invested off-plan, following the collapse in property values in places like Spain and the USA.

“Now these projects are nearing completion and the final staged payments are becoming due, property owners are realising they have already paid two or three times what their investment is now worth, without even adding in this final payment”, Overseas Property Mall report.

Irish investors have also been hampered by problems in their own domestic property market with the average price of a home in Ireland have depreciated by around 24% since the peak of the market in 2007, according to Fitch rating agency. Although many international investors, not just the Irish, have had their fingers burnt by the recent collapse in property values, the fact is that many of them bought property at or near the top of the cyclical upturn.

“Following recent stern price corrections, property values in many countries are now much closer to bottoming out. Some markets are already showing tentative signs of improvement, with transactions and prices increasing once more. Now is the time to invest astutely in property, not shun away from it.” So if this trend continues then other ex pats may pick up more bargains as many Irish have heavily invested in Tenerife and the Canary Islands in recent times.

By Angela | Posted in Economy, General, Holiday, Inspirational, Miscellaneous Articles, Property, Tenerife, Things to Do, Uncategorized | Tagged , , , , , , , , , , | Comments (0)