Brits amongst the most active purchasers in Spain and the islands

May 15, 2012 – 9:27 am

Brits active in property market in Tenerife and Spain

Official figures show that Brits were among the most active purchasers of homes in Costa Blanca last year, along with the Russian and Norwegians, which collectively made up 80% of all transactions in the region.

According to figures obtained from Spain’s notaries, at least 9,200 foreigners bought holiday homes on the Costa Blanca last year, including 5,200 in the Catalonia region Costa Brava/Dorada, and 4,600 in Malaga  Costa del Sol; Balearics (2,700), and Murcia (1,500).

José Vicente Dómine, Director General of Public Works for the Generalitat (Valencian regional government), told the press that more overseas nationals purchased bought homes on the Costa Blanca last year than in Madrid and Andalusia combined, and almost as much as Catalonia, the Balearics, and Murcia combined.

While the Spanish property market continues to suffer from an oversupply of homes, now is a great opportunity “for foreign buyers to bag a bargain on the Spanish coast,” said Spanish property commentator Mark Stucklin.

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More misery for the Spanish property market?

May 2, 2012 – 12:54 pm

More property investment misery in Tenerife and Spain?

The Spanish property market faces more misery with average residential prices expected to fall by a further 18% before finally bottoming out, according to Barclays Capital. The British investment bank says that the decline in values will add to the 22% price drop witnessed since the Spanish property market crashed in 2008. The bank’s latest report claims that Spanish home prices will drop by up to 35% before reaching the bottom of the downturn. But the reality is that property price falls nationwide have been far steeper and have already depreciated by 40%, on average. In fact, this rate of fall has been confirmed by Spain’s Minister for the Economy, suggesting that Barclays Capital’s data is largely unreliable. “So Barclays Capital are right to say that prices might fall 40% in total, but wrong to say that means another 18% of declines to come,” says Spanish property commentator Mark Stucklin. “We are already almost there [at the bottom], certainly when it comes to holiday homes on the coast.”

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Average price of a home fell by 11.5% in March compared to last year

April 18, 2012 – 9:43 am

 

Property prices continue to slide in Tenerife and Spain

Vendors have been forced to slash property prices across the country in order to have any chance of realistically attracting a serious buyer, but with the well documented Spanish property crash showing no sign of abating, prices look set to fall further.

Despite claims from some estate agents and developers in Spain that market conditions are improving, it would seem that they are actually getting worse.

The average price of home in Spain fell by 11.5% in March compared to the corresponding month last year, according to Spain’s most widely-watched annualised House Price Index compiled by Tinsa, a leading property valuation firm. The annualised decline in Spanish property is the highest since the housing crash got underway over four years ago.

Spanish home prices have, on average, now dropped by 28.6% since the crisis started in December 2007 and by 35% along the coast, where the greatest glut of homes are located.

Advisory firm R.R. de Acuna & Asociados recently projected that the average price of a home in Spain will fall by 12%-14% this year – the most since the National Statistics Institute started tracking values in 2007.

Fernando Rodriguez de Acuna Martinez, a partner at the advisory company, said: “There will be more serious price drops this year because of the government decree.” What  could happen to prices beyond 2012? With unemployment standing at 23%, which is higher than Greece, and given that Spain is deep in a recession, with greater austerity measures to come, it would appear that prices still have a long way to fall.

Bankinter estimates that housing prices will fall an additional 6% to the end of 2013, but the reality is that the decline is likely to be greater and for longer.

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Increasing numbers of Scandinavians are taking advantage of the crisis to buy holiday homes in Spain

April 17, 2012 – 9:34 am

Scandanavian buyers of property are looking to Tenerife and Spain for investment

According to a recent article at the website Investment Europe, “Figures published by Fastighetsbyrån, part of Swedish banking group Swedbank, suggest Swedish and Norwegian property buyers have pushed hard into the Spanish residential property market, as British and German buyers have withdrawn in the past half-decade.”

The article goes onto explain that “over the four year period, the number of UK buyers has dropped by 65% and German buyers by 3%. However, the number of Norwegian buyers is up 108%, and Swedes by 138%. The total market is still down 33% from its 2007 peak, the figures also suggest.”

Scandinavians are tempted by Spanish property, their economies are relatively strong, as are their currencies (the Norwegian and Swedish Krone/Krona have both risen by around 5pc against the Euro since the Spanish property bubble burst at the end of 2007, whilst the British Pound has fallen almost 20pc); Spanish property prices on the coast are down around 50pc or more from the peak, and the sun doesn’t shine much back at home. So Scandinavian buyers are taking advantage of the market to snap up bargains on the Mediterranean coast, and who can blame them?

Scandinavian buyers are not a panacea for the glut of holiday homes on the coast. For a start, with the pick of the best properties, I doubt they will be tempted by  the cheaper end of the market on the coast that also needs to be sold.  Unfortunately, there just aren’t enough of them to take the place of the retreating Brits, who dominated the market during the boom.

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

The biggest annualised fall in Spanish property prices since the crisis began

April 16, 2012 – 8:35 am

Average Spanish house prices fell 11.5pc in March compared to the same time last year, according to the latest data from Tinsa, one of Spain’s biggest appraisal companies.

House prices fall in Tenerife and the Canary Islands in Spain's slump

That represents the biggest fall in the index since the crisis began and since Tinsa started publishing this index.

Housing on the coast, where most holiday homes are located, fell 10,79pc, marginally less than the national average. Prices in the Balearics and the Canaries were down 9.71pc.

Peak (Dec. 2007) to present, average national prices have fallen 28.6pc and by 35pc on the coast, all according to the Tinsa Index.

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Banking reforms set to hit Spanish property prices

March 20, 2012 – 10:11 am

Banking reforms in Tenerife and Spain affect property prices

New banking reforms are expected to hit Spanish property prices hard, causing values to plummet across many parts of the country, particularly in popular holiday destinations, presenting further bargains for house hunters looking to buy a home in Spain.

According to Spanish Property Insight, referring to a recent article in the Spanish financial daily Cinco Días, the Spanish government has introduced reforms to reduce home prices and get banks lending again. But some experts believe that this will cause the price of holiday homes on the coast to plummet due to the chronic oversupply of unsold homes on the market.

Josep Oliver, economics professor at the Autonomous University of Barcelona, believes that property prices in the country’s main cities are now at or near the bottom of the downturn, but the same can not be said for holiday homes along the coast.

“There is not much room left for price declines,” he told the press. “Discounts of up to 50% are only being considered for holiday homes or unfinished new-developments.Whilst the stock grows in holiday home areas, demand is focused on big cities and provincial capitals where there is little excess and prices have already adjusted.”

According to CatalunyaCaixa, a savings bank, about 65% Spain’s housing glut of 800,000 new homes was built on the coast with holiday home buyers in mind, especially in Catalonia, the Balearics, the Valencian Region, Murcia and Andalucia.

The province with the biggest problem by far is Castellón, in the North of the Valencian Region, and home to the so-called Orange-blossom coast (Costa del Azahar), with around 114,000 empty new homes, compared to 57,000 in Barcelona and Alicante (Costa Blanca), 52,000 in Murcia, and 40,000 in Valencia province.

“That means Castellón, a relatively unheard of destination with a new airport that nobody yet flies to, is responsible for around 20% of the entire Spanish glut of new holiday-homes. New developments in Castellón like Marina D’or development help explain why, said Mark Stucklin of Spanish Property Insight.

He added: “The excess inventory of new homes in Malaga province, home to the Costa del Sol, is relatively minor in comparison. According to local builders there are less than 20,000 new homes on the market, most of which will have sold in the next couple of years. The Costa del Sol is a mature market with good access and diversified international demand where almost everything sells in due course.

“The Costa del Azhar is a different story. Who will buy 114,000 new holiday-homes there in any reasonable time-frame? What if prices get really cheap there? Will that help, or is there no demand at any price?”

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Developers ask government for mortgage interest tax relief on holiday homes

February 1, 2012 – 11:51 am

Developers ask for reduction of tax on properties in Spain and Tenerife

The G14 association of Spain’s leading developers says it will ask the Government to introduce mortgage interest tax relief on holiday homes to stimulate demand and deal with Spain’s   empty new holiday homes on the coast.

The Government has just reintroduced mortgage interest tax relief on main homes, despite the fact that it favours owner-occupiers at the expense of those who rent, and makes it harder for Spain to reach its stated goal of increasing the rental market. Developers want a similar tax break for holiday homes.

Some industry voices like Antonio Carroza  have wasted no time in describing the request as “irresponsible”. He believes it is wrong to use public money to subsidise “large developers so they can sell second homes that should never have been built,” he said, quoted in the Spanish press. In any event the tax relief would only apply to Spanish residents, not foreigners buying holiday homes in Spain and Tenerife.

The G14 has also called on the Government to reduce the ITP sales tax on resale properties.

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Latest Price Index from Tinsa

November 17, 2011 – 9:53 am

Tenerife and the Canary Islands fare best in Tinsa's latest property index

Average Spanish house prices fell 6.9pc over 12 months to October, according to the latest House Price Index published by Tinsa, one of Spain’s leading appraisal companies.

Prices fell the most (-8.1pc) in regional capitals and metropolitan areas (-7.5pc), followed by the Mediterranean coast (-6.9) where holiday homes are concentrated, and where prices dropped considerably less than September. Prices fell the least in The Balearic and Canary Islands (-3.4pc).

Peak to present, prices are down on average 30pc on the coast, and 20.5pc on the islands.

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

Significant fall in property prices according to Tinsa.

November 10, 2011 – 9:39 am

Property prices falling in Spain especially by the coast

According to José Manuel Galindo, President fo the APCE builders and developers association, the fall in property prices, has been “significant”.

Prices are now down a total of 26pc in real terms since their peak, says Galindo, taking into account inflation and a reduction in VAT. When it comes to holiday homes on the coast, however, the falls have been more brutal. Prices on the coast have fallen by 32pc, according to Tinsa, and anecdotal evidence suggests it might even be higher than that.

Galindo stressed that many developers cannot afford to reduce prices any further. “Developers can’t sell below the cost of their mortgage, because they no longer have the money to afford the adjustment,” he explained.

 In the long-run, price will fall to affordable levels, regardless of how much builders or banks have to lose in the process.

Turning to the collapse in sales (down 40pc in August alone) Galindo blamed it on the lack of credit and local “purchasing capacity” and pinned his hopes on foreign buyers heping Spain mop up its glut of close to 300,000 unsold new homes on the coast.

He also described the recent Government led road show to promote Spanish property around Europe “rather ineffective”.

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September Tinsa Index

October 19, 2011 – 2:00 pm

Average Spanish house prices fell 7.4pc over 12 months to September, according to the latest House Price Index from Tinsa – one of Spain’s leading appraisal companies.

Prices fell the most (-8.9pc) in capitals and large cities, followed by the Mediterranean coast (-8.2) where holiday homes are concentrated.

Peak to present, prices are down on average 24.1pc, and by 31.9pc on the coast.

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