Sterling high good news for Brits buying property in Tenerife and eurozone.

January 27, 2012 – 10:55 am

Sterling high against the Euro a boost for property buyers in Tenerife and Spain

There was good news for Brits seeking to buy property in the eurozone as sterling reached a 15-month high against the euro currency. The euro’s value depreciated against the UK pound on the back of fresh concerns regarding the the health of the eurozone’s banking system.

Sterling increased by 0.73% to €1.208 on Wednesday  its highest level since September 2010. The euro also fell 0.95% against the dollar to $1.293. Despite concerns about the fragile state of the UK economy, it is generally considered to be doing better than the Eurozone, which is struggling with a major debt crisis.

Geoffrey Yu, currency strategist at UBS, told Reuters: “Maybe the UK is approaching a consensus (for a recession) but it’s not there yet. And there’s no break-up risk, so people are more willing to allocate funding from a passive perspective at the start of the year.”

However, despite the recent recovery in the strength of the pound versus the euro, some currency experts do not expect sterling’s value to increase much further in the short- to medium-term.

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

Bargain homes in Spain prove popular with international buyers.

January 26, 2012 – 10:05 pm

Bargain hunters in property are investing in Tenerife and Spain

Overseas nationals spent €3.6bn (£2.3bn) on buying homes in Spain in 2011, as they took advantage of significantly discounted properties, according to data supplied by the Bank of Spain. The figures show that foreign property investment in Spain increased by 27% last year compared to the preceding year.

With Spain’s economy in turmoil and the housing market in disarray, owed largely to a major oversupply of homes, property prices have been in freefall, attracting more bargain hunters in the process. The hike in property sales in 2011 marks a second consecutive year of growth in international investment with 2011 beating the total value of transactions in 2010.

Many property professionals believe that the rise in foreign investment activity is a sign that property market conditions are improving. Spanish journalist Daniel Talavera  believes that the Spanish property market is now touching rock bottom of the downturn.

“2011 has probably been the worst year in terms of property prices and sales drop. If the price fall in 2010 was by 3% compared to 2009, the mentioned fall of 6.85% in 2011 compared to 2010 confirms that the market is reaching its lowest at the right speed.”

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

Spain’s central bank forecasts contraction of 1.5% this year

January 23, 2012 – 4:14 pm

Spain's Central Bank expects contraction of 1.5% this year

Spain’s central bank on Monday forecast that the country, which is struggling to slash its deficit and debt, will fall back into recession this year with a contraction of 1.5 percent.

The Bank of Spain said however it expects Spain’s economy to make a modest rebound in 2013 with growth in gross domestic product (GDP) of 0.2 percent. It added that it estimates the economy to have grown by 0.7 percent in 2011.

“In 2011 the modest recovery which the Spanish economy began a year earlier weakened as the eurozone sovereign debt crisis extended to a greater number of countries and financial market tensions strengthened,” it said in a report. Source: Google.com

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

Second increase in CGT for non resident property owners in Spain

January 5, 2012 – 4:56 pm

Spain and Tenerife property owners hit by CGT rise.

A second increase in the Capital Gains Tax (CGT) levied on non-residents by the Spanish Tax Office has just been announced.

From January the 1st 2012 CGT for non-resident property owners in Spain will stand at 21% across the board. This follows a previous rise in 2010 from 18% to 19%.   In 2007 the European Union put pressure on Spain to lower the then CGT rate of 35% for non residents (15% for residents) to 18%  deeming it to be an unfair penalty on non-residents. A rise of 1% in 2010 passed relatively unnoticed but a  trend towards accelerating tax increases to boost the dwindling economy.  

Spanish Residents will also feel the increase with figures rising to 21% up to 6000 Euros , 25% between 6001 Euros and 24000 Euros and 27% on higher figures.

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

Bankinter’s latest report on Spanish housing market.

December 1, 2011 – 9:57 am

 

Bankinter's latest report suggests that Spanish house prices will fall again

According to Bankinter’s latest report on the housing market in Spain, housing prices will fall an additional 6% up to the end of 2013, making an adjustment of 30% in real terms from their peak, and only begin to rise again in early 2014, when the economy is capable of generating employment and demand recovers.

With regard to their forecast made last April, the financial institution have deferred for a year the adjustment in the housing sector, saying that promoter activity will not take off until the last quarter of 2014, when the housing ‘stock’ will have reduced to below the 500,000 mark.

Until then, only discounts and minimum production, will “very slowly” digest a ‘stock’ of houses which now stands at, they estimate, between 850,000 and 900,000 homes, of which about 200,000 or 250,000 belong to financial institutions. Bankinter sees the two years ahead with demand at minimum levels because of high rates of unemployment, which in 2011 alone saw home sales plunge to around 200,000 new properties, which was 55% less than what was sold in 2007, the year with the highest recorded demand in history (412,000 homes).

Bankinter’s calculations suggest that the Spanish economy will grow 0.7% in 2011, half of what the Government anticipated  1.2% in 2012 and 1.6% in 2013, below the 2% needed to create jobs, reported Cinco Dias.

Source: Kyero.com

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INE say sales down in September

November 21, 2011 – 10:25 am

House sales down say INE

There were just 22,065 home sales in September (excluding social housing), 30.5pc down on the same month last year and 62pc down on September 2007, according to the latest figures from the National Institute of Statistics (INE).

Monthly sales this year since March have been the lowest since the crisis began. The positive start looks like a dead-cat-bounce. On a year-to-date basis sales in 2011 are 20pc below last year, and 56pc below 2007. The big question is can it get any worse in 2012?

Sales have been bad this year, falling by as much as 40pc in August, with an average annualised fall of 29pc each month since March. the market is shrinking fast, a clear sign that prices are still too high.

All this at a time when Spain is saddled with a monumental glut of homes for sale, not to mention unemployment of 22pc and rising. More than 40pc of young Spanish adults are out of work. Demographics are also starting to blow against the Spanish economy.

Unless the newly elected  Government takes radical steps to liberalise the economy, boost employment, and force banks to stop keeping property prices artificially high, it’s hard to see a way out of this mire.

What about holiday homes? The situation is a bit different because demand is internationally diversified, at least in some areas such as Tenerife. Some quality segments of the holiday home market will recover before the overall housing market. That said, this year and next year will be very tough.

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

Luxury property success in Spain

October 12, 2011 – 9:01 am

Luxury property selling well in Spain and Tenerife

A luxury Spanish property agency has reported its most successful ever quarter in the three month period from July to September.

Lucas Fox International Properties sold €19.5 million-worth of luxury Spanish real estate in 2011’s third quarter, its best performance since opening six years ago.

Lucas Fox sells properties in Barcelona, Costa Brava and Ibiza.

Alex Vaughan, Director of Lucas Fox, said that recent rich buyers continue to enter the market despite recent negative comments. Personally, I can’t wait for them to start selling luxury properties in Tenerife, that will hopefully inject much needed cash into the local economy

Source: OPP

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

VAt on new homes slashed

September 29, 2011 – 9:51 am

Vat slashed on Tenerife and Spanish homes

VAT on new homes will be slashed from 8pc to 4pc for the rest of the year, José Blanco, Minister of Public Works and Housing announced this week.

The VAT reduction will only apply to sales of new homes that take place before 1 January 2012. Someone buying a new home for 200,000 Euros before the end of the year from a bank or developer will pay 8,000 Euros less in VAT.

Resale properties will not benefit because they do not incur VAT. Anyone buying a resale from a private vendor will continue to pay a transfer tax of 8pc, rather than VAT at 4pc.

However, at least one savings bank – Catalunya Caixa – has announced that it will also offer a 4pc discount on all its resales (repossessed homes) between now and the end of the year. Others banks are expected to follow suit.

The Government’s stated objectives with this latest measure are to help reduce the stock of new homes for sale, giving the construction sector a boost and stimulating employment.

According to José Luis Rodríguez Zapatero – the Prime Minister  said “if it wasn’t for the construction sector, the Spanish economy would be growing at 2pc. All the jobs lost today are in construction.”

Elena Salgado, Minister of Finance, said the reduction in VAT will be “sufficient to reduce the stock of homes.”

As recently as July last year, the Government increased VAT on new homes from 7pc to 8pc in an attempt to increase revenues and reduce the budget deficit. This is a U-turn that hardly covers the Government in glory.

If the fall in VAT does anything to stimulate the market it will only benefit those with new homes for sale, principally developers. As a result, private vendors will find themselves under further pressure to reduce their asking prices.

The opposition Popular Party has promised to extend the rebate for an extra year if it wins the general election in November.

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

No VAT increase in Spain says Salgado

June 30, 2011 – 8:55 am

No VAT increase in Spain, Tenerife and the Canary Islands

The Government’s financial vice president, Elena Salgado, has responded to the suggestion of the Bank of Spain to raise VAT in order to generate more revenue, by saying that the Government “will not increase VAT, since it would have a negative effect on consumption”, as was argued at the European Commission. “To be clearer, the Government will not increase the VAT,” she added.

At a press conference to present the Ministry of Development’s advertising campaign on rehabilitation, Salgado said that “fiscal policy is the responsibility of the Government which then must be approved by Parliament”, to which she added that Government revenues are behaving as expected, and “it is not necessary to raise VAT to achieve fiscal consolidation.”

In the same vein, she praised Brussels’ decision to back down in its request to raise Spain’s tax as a counterweight to a reduction in social contributions, and stressed that the European Commission has been “sensitive” to the Government’s arguments. At this point, Salgado also rejected the possibility of reducing social security contributions, stating that “we should wait a bit before taking steps in that direction,” at least to see how the pension reforms progress.

On the other hand, asked about the proposal of the bank run by Miguel Angel Fernandez Ordonez to set expenditure ceilings in the Autonomous Communities , the Minister of Economy stated that “the regions themselves must decide” if they set an expenditure ceiling, given their “financial independence.”

Source: Kyero.com

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

Spain’s economy is showing signs of recovery.

April 8, 2011 – 9:08 am

Spain’s central bank Governor Miguel Angel Fernandez Ordonez predicts the economy in Spain and Tenerife will improve

Despite the government’s best efforts, Spain’s economy is only giving signs of a very moderate recovery, and remains hindered by recent falling property prices. A significant rebound would only come with an upward movement in activity in the real estate sector which is still in its infancy.

In a welcome bout of openness, Spain’s central bank Governor Miguel Angel Fernandez Ordonez said Tuesday the reform of Spain’s savings banks, saddled with bad property loans like no other, should have taken place sooner.  The damage from Spain’s property problem  has left savings banks, which account for close to half of Spain’s banking business, unable to provide credit to the economy. That, combined with soaring unemployment tied to builders being left with nothing to build, has left Spain’s economy as key European underperformer. According to data released Tuesday, the purchase managers’ index for Spain’s services sector dipped back to negative territory in March, to 48.7, from 50.8 in February, indicating a decline in activity. That compares with a rise in the overall services PMI for the euro zone, to 57.2 from 56.8 in February.

Source: Wall Street Journal

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