Monthly planning approvals at record lows

May 16, 2012 – 1:07 pm

Monthly low for new builds in Spain and Tenerife

Monthly planning approvals for new homes are close to record lows, and might create a shortage in the next 5 years. There were just 4,600 planning approvals for new homes in February, down 44pc on the same month last year, according to the latest figures from the Government (Fomento).

Compared to February 2006, when Spain’s building boom was in full swing, planning approvals are down 93pc. That shows how badly the Spanish house building industry has been hit . From being the driver of Spain’s economy it has collapsed to almost nothing, which helps explain why unemployment is close to 25pc and heading for 30pc.

As a result of the collapse in planning approvals, there will clearly be a shortage of newly built homes in the next 3 to 5 years. This despite the fact that there is a glut of something like 750,000 newly built homes on the market today.

The problem is that many of those homes are typical of what gets built at the peak of a boom, badly built too quick, in undesirable locations with scant regard to what house buyers actually want. There is always a demand for new homes, that are properly built and well located. 

It is best to try to buy off-plan in the depths of the bust, not at the peak of the boom, though, most people do the opposite.

People  want  better designed, better built, more generously sized, more energy efficient, better located, and significantly cheaper homes than are on offer. As there are hardly any developers left standing,we are clearly going to see a shortage of such properties in Spain and Tenerife in the future.

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

Cheaper homes in Spain as sellers try to attract more buyers

February 17, 2012 – 2:33 pm

Cheaper rental and sale property prices in Tenerife and Spain

Resale Spanish property asking prices continued to fall last month, as more vendors slashed prices in a bid to secure a sale. The latest home price index published by idealista.com shows that the average price of a home in Spain depreciated by 9.4% compared to January 2011.

The figures provided by the Spanish property portal reveal that January 2012 was the worst month since the Spanish housing crisis started four years ago. On a month on month basis, asking prices of homes in the idealista.com database depreciated by 1.9% to an average price of €2,045sqm (£1,712sqm) suggesting that homeowners are becoming more realistic about the need to reduce property prices if they are going to have any chance of attracting more home buyers.

It represents the biggest fall in asking prices since idealista.com started publishing the index before the property crash got underway in 2008.

On a monthly basis, prices fell the most in Castille La Mancha (-2.3%), followed by The Balearics, Asturias and Andalucia (-2.1%).  With property prices falling, housing affordability has somewhat improved in Spain, based on average property prices versus average gross annual household income, which has fallen from 7.7 years at the peak of the property boom to a current rate of 6.2 years, according to the Bank of Spain.

Spanish families might welcome more affordable housing,  but housing is still much more expensive than it was before the boom, when it cost just 4 years gross annual income or less.

“There are several reasons why the affordability ratio has not improved more with falling property prices, including higher mortgage borrowing costs and lower household income, said Spanish property commentator Mark Stucklin.

He continued: “None of this really applies to the cost of holiday-homes on the coast, where prices have fallen substantially more than the national average, and where foreigners with higher incomes than the Spanish national average tend to buy.”


The average cost of renting a home in Spain also fell last year as rental prices depreciated in 77% of Spain’s primary rental markets, the latest to data from Idealista.com and the Public Rental Company show.

The greatest rental price decline was recorded in Toledo by 8.7%, followed by a 6.8% drop in Oviedo. In Spain’s largest cities of Barcelona, Madrid and Valencia rents fell by 3.1%, 1.3% and 4% respectively.
However, rents actually increased in Lleida, Bilbao and Alicante rentals, rising 11.2%, 4.2% and 4.1% respectively.

These rental price declines follow on from falls in 2010, suggesting that Spanish homes are becoming cheaper to rent, as well as buy.

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

Property prices to fall further?

November 28, 2011 – 9:37 am

 The distressed nature of the Spanish property market combined with the country’s fragile economy suggests that property prices will fall further, despite the fact that they have tumbled nationwide since the peak of the market in 2007. The Eurozone debt crisis that has already seen three countries, Greece, Ireland and Portugal bailed out is now threatening much bigger economies like Italy and Spain. Furthermore, with unemployment and foreclosure levels in Spain both growing, it is hard to see how further price falls are not inevitable, presenting purchasers with an opportunity to bag an even cheaper priced home in Spain. Fresh research by an association of homeowners facing foreclosure (AFES), reveals that almost 20% of Spanish mortgages signed between the boom years of 2004 and 2008 are or will become delinquent. AFES calculate that over 700,000 families will have had their homes repossessed by 2015, which is a tragedy. But while extremely unfortunate, it does present those in a position to buy property, with an opportunity to secure a home at an even cheaper price, crushing any slim hopes that that market will soon embark on the road to recover. Mark Stucklin of Spanish Property Insight wrote: “Specifically, there were four million home purchases between 2004 and 2008 , the bubble years of the Spanish property boom  of which 170,000 have already been foreclosed, another 170,000 are in process, and another 375,000 are expected to be repossessed by 2015.” “All this at a time when there are more than three million empty homes in Spain,” he added. AFES propose partial or total debt forgiveness by banks, more mortgage lending, and lower property prices to making housing affordable. “The big social drama is that after losing their homes people are saddled with debts they can never afford to pay,” said Carlos Baños, President of AFES. or total debt forgiveness by banks, more mortgage lending, and lower property prices to making housing affordable. “The big social drama is that after losing their homes people are saddled with debts they can never afford to pay,” said Carlos Baños, President of AFES.

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

Sellers asking less for their homes at the cheaper end of the market

July 18, 2011 – 9:02 am

The number of vendors asking less for their homes leapt to 30,646 in May, 7% of all vendors and an increase of 73pc on last year. They reduced asking prices by an average of 8.2pc in a year.

So far this year 134,107 vendors have dropped their asking prices, 69pc more than last year and 31pc of the total.

In total, vendors are now asking 700 million Euros less in a month, 3.2 billion less this year, and 6.4 billion less in the last 12 months. That is potentially a huge transfer of wealth from vendors to buyers.

The biggest number of vendors asking less was at the cheaper end of the market, with 8.3pc of vendors with asking prices below €200,000 dropping their prices, compared to 6.5pc of vendors asking more than €600,000.

In value terms, however, prices at the cheaper end fell by an average of 8.6pc compared to 9.3pc for more expensive homes. This is the time to visit a reputable estate agent and look for that bargain in Tenerife, whether it is a cheaper property or a prime property.

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

Spain back in top spot for enquiries

January 25, 2010 – 5:28 pm
Spain and Tenerife top the enquiry list for holiday properties

Spain and Tenerife top the enquiry list for holiday properties

Holiday lettings companies  advertising Spanish holiday homes benefit from a kick-start to 2010 with a significant increase in enquiries, some fresh accommodation stock and the fantastic news that living costs have fallen making it even more cost effective for self-catering holidaymakers in Tenerife,the Canary Islands and Spain.

Throughout 2009, Spain vied for the top destination spot losing out much of the year to the UK. Now Spain is back with vengeance stealing the top spot back,  the Canary Islands pinch fourth  place in the popularity stakes. However, the Canary Islands continue to draw winter sun seekers on good deals and cheap flights

Spanish holiday home owners are proving savvy to this change in mood with increasing numbers offering special offers for advance bookings. This tactic is particularly good at reaching families who need to plan ahead due to the restriction of school holiday dates.

Homes in the Canaries may have greater competition for business because of the volume of holiday apartments available, but they have a truly year round market, with no seasonal fluctuation and can optimistically look to fill 35 plus weeks a year with paying guests.

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

Spanish loans on the increase.

August 8, 2009 – 10:13 pm
Loans increas in Tenerife and Spain as property prices are more affordable

Loans increase in Tenerife and Spain as property prices become more affordable

The number of new Spanish property mortgages approved in May rose by 15per cent to 57,614 compared to the previous month, indicating that demand for property in Spain and Tenerife is rising, according to Spain’s National Institute of Statistics.

However, on an annual basis the volume of mortgages issued in May fell 23per cent, compared to the corresponding month last year.

The average mortgage value in May fell 14per cent to €121,120 (£102,560) year-on-year, but rose 5per cent month-on-month potentially reflecting the fact that cheaper properties in Spain and Tenerife are now available.

Overall new mortgage lending was €7bn, down 33per cent year-on-year, but 20per cent higher than April.

The average interest rate agreed for new mortgages in May was 4.6per cent, 11per cent lower in percentage terms than a year ago, and 2.2per cent lower than the previous month.

The majority – 96per cent – of all Spanish mortgages secured were on a variable rate, with the other 4per cent fixed.

By Angela | Posted in Economy, General, Miscellaneous Articles, Property, Tenerife, Things to Do, Uncategorized | Tagged , , , , , , , , , | Comments (1)