A weaker Euro means less pounds for British vendors who repatriate their funds to the UK

January 25, 2012 – 1:25 pm

The weaker euro v the pound affecting property vendors in Tenerife and Spain

In the Euro zone , we continue to see the  single currency’s woes. For many investors and property owners in Spain it’s time to look at the bigger picture, which doesn’t paint a pretty scene as the hang-over continues into 2012.

The second half of last year revealed a number of detrimental factors that have hurt the Euro zone – a worrying decline in stocks, increase in unemployment, Governments finally pulling their heads out of the sand and recognising the problems within their own countries have all contributed to the crisis, which left people asking whether the single currency will even survive a year. It is a fair assumption that the Euro zone debt crisis will remain the central focus of markets going well into the New Year, so further weakening of the Euro is expected.

The outcome of the EU Summit last month did little to support the currency, with the outlining of plans to work towards greater fiscal integration in the euro zone failing to provide any comfort to the market as GBP-EUR pushed the €1.20 (0.833) level, and some forecasting €1.25 (0.8) by the end of February.

So the Euro could well continue to fall, in which case now might be a good time to sell it, or get a forward contract to do so if you are not yet ready (for example, if you are in the process of selling a property in Spain).

For example, if you wanted to change Euros into Pounds in June last year, when one Pound cost 1.11 Euros, but you didn’t have access to the Euros until December, a foward contract could have saved you £6,992.21. Firstly, you agree a rate of exchange for the amount of Euros that you are looking to sell and give a date that you know that the funds will be available before (bond maturity, or date of expected house completion for example).

A 10% deposit is needed within a few days of agreeing the rate and you can then relax and not be affected by any market movement, and can get your money at any stage at the fixed rate and all you need to do is send over the Euros when you have them before the end of forward contract.

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

Spain stepping up tax plans

January 3, 2012 – 10:07 pm

Spain's taxation approach helping property sales in Tenerife?

Spain is stepping up its tax plans to tackle the country’s deficit, but buyers are snapping up property regardless as further price drops are predicted for 2012.

The Spanish government’s predictions initially stated that national debt would amount to 6 per cent of GDP for 2011, but it was revealed last week that these figures were incorrect and that the country deficit is closer to 8 per cent.

Since then, Spain’s government has added that the debt “could be even higher”, according to The Daily Mail, prompting the recently elected Popular Party to go back on its pledge not to raise taxes. Property tax is expected to increase for homes above average value, Spain’s swift economic action has been welcomed by the EU as the country tries to reassure international investors who are snapping up properties at low prices.

Indeed, reports at the end of December from Global Property Guide found that foreign property transactions surged by 24.7 per cent in the third quarter of 2011, compared to the same period in 2010.

Alicante, Barcelona, the Balearic, Canary Islands and Malaga were all highlighted as popular areas for buyers, with research from Scotibank Group showing that house prices across Spain have fallen by 25 per cent since 2007. These price drops are now expected to continue in 2012.

Knight Frank’s Prime Global Forecast has predicted that global economic uncertainty will push Madrid’s property values down in the next 12 months. But with investors attracted by Spain’s declining property prices, Madrid’s fall of “less than five per cent” may provide more opportunities for international buyers. As Murcia prepares for the construction of its much-awaited Paramount Theme Park, buyers can benefit from the national downward trend while costs remain low.

Julio Adams said “Demand for key ready homes in this area is already high and we expect an equity boost of around 15 per cent for early buyers when the first spade goes in to start construction of Paramount Park.” With some Spanish regions seeing a gradual recovery and the number of foreign transactions on the up, the government’s reworked deficit plans may take Spain’s housing market in a positive new direction for the New Year.

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

Attention furnished holiday let owners,only two months left to apply for a tax rebate.

December 6, 2011 – 9:34 pm

Owners of furnished holiday lets in the UK and EU may be entitled to a tax rebate for the last four years but the window to make the claim to HMRC closes on 31 January 2012.

The rebate is achieved by claiming maximum expenses and allowances against your rental income from the holiday let. This will either then reduce taxable profit, or result in an overall loss for the tax year. That loss can then be offset against your other personal income from employment, dividends etc.

Most investors and their accountants would not be aware of the rules on the relevant allowances and loss offsets to take advantage of this window of opportunity. The key questions to ask yourself are:

  • Is your furnished holiday let within the EU?
  • Was the property rented out for 70 days or more in any tax year, and for no more than 31 days to any one party?
  • Are you a UK tax payer?

If you can answer “yes” to the above questions then you should get in touch with an accountant to see what  tax rebate you can get.

 

Two weeks remain for furnished to let property owners in Spain and Tenerife to claim a tax rebate

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

Fewer people from outside EU granted authorisation to reside in EU

September 8, 2011 – 8:51 am

Fewer non EU residents allowed to stay in Tenerife and EU countries

Fewer people from outside the European Union are being granted permission to live in member countries and those who do are moving mostly for family reasons, for work and for education, new figures reveal.

The latest bulletin from the EU shows that 2.3 million people were granted an authorisation to reside in the EU, a fall of 200,000 compared to 2008.

The highest number of new residence permits, 660,000, 28.2%, was granted for reasons related to family. Also 646,000, 27.6% were for employment, and 510,000, 21.8% for education.

Compared with 2008, the number of new permits issued for employment, which was the main reason in 2008, fell by 142,000. In addition, the number of permits issued for family reasons fell between 2008 and 2009, but to a lesser extent, by 26,000, while permits for education increased by 53,000.

Source: ExpatForum.com

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

End to the expats problems when buying homes in EU?

June 21, 2011 – 12:30 pm

Guarantees for ex pats buying in Spain and Tenerife via ELRA?

EU parliament vice president Diana Wallis MEP has commended a pilot scheme that promises to end the probems experienced by expats when buying property in Spain,Tenerife and other EU countries.The scheme, set up by the European Land Registry Association and funded by the EU, allows for the purchasing procedure to be settled in the buyer’s home country and under the protective laws of that country. It also guarantees compensation for unknown restrictions and violation of the contract by the seller. Currently piloted in Holland and Spain, the Cross Border Electronic Conveyancing (CROBECO) scheme means that a Dutch buyer of Spanish real estate can apply Dutch law to the contract and ask a Dutch court for compensation from the seller if he later finds out there are unknown public limitations, such as retrospective planning laws, affecting the property. Pilots with other countries are expected later this year. Diana Wallis MEP (Liberal Democrats, UK), who has long campaigned for an EU-wide guarantee of legal certainty when buying cross-border, said: “I feel more and more convinced about the work of the Land Registry.

Source: Telegraph.co.uk

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

Eu to reintroduce visas?

May 26, 2011 – 12:49 pm

EU may consider reintroducing visas for migrants

The European Union could temporarily reintroduce visas for some travellers from outside the bloc in case of a sudden influx of migrants from a specific country, under plans presented by the EU executive on Tuesday. The proposal addresses concerns by some EU governments about a sharp increase in asylum seekers from the western Balkans, where countries won the right to visa-free travel to the 25 member states of Europe’s border-free Shengen area. It also reflects a growing reluctance in Europe to keep its borders open at a time when turmoil in North Africa is driving thousands of people to seek refuge and jobs in the EU, while public opinion grows hostile to newcomers. The European Commission said new rules would allow EU member governments to quickly restore visas in case of a “high inflow of irregular migrants or a sudden increase of unfounded asylum requests from a third country.”

Certainly the influx of migrants to mainland Spain and particularly Tenerife in the  Canary Islands has put the authorities under pressure at already increasing difficult economic times.

 Source: Reuters.com

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

Spain to avoid EU bailout

April 12, 2011 – 11:05 am

Spain to avoid EU bailout as property sector begins to recover.

After much speculation on the fate of its debt-ridden economy, it looks as though Spain will avoid seeking a large-scale financial bailout from the EU – an expression of confidence in its recovery that bodes well for property investors. 

Despite speculation since last autumn that its debts were unsustainable and there was no other option for the floundering nation but to seek EU rescue, Spain has stood strong whilst both Ireland and Portugal fell victim to debt crises, and now looks to be out of the woods. French finance minister Christine LaGarde, one of the key European authorities at the centre of EU crisis negotations, told the Wall Street Journal that “Spain isn’t a problem”, while German Finance Minister said that as far as the debt crisis in Spain was concerned, “the risk of contagion has lessened.”

Unlike Portugal and Ireland, which saw severe public opposition to national spending cuts and faced difficulty getting them through parliament, Spain has successfully implemented a drastic debt reduction program and has already cut its budget deficit to 9% from 11% in 2009, although unemployment remains high. As a result, borrowing costs for the country remain at a stable level, and investors appear to be renewing their confidence in Spain and returning to the market.

“Investors increasingly have come to differentiate between Ireland,Portugal and Spain”, economist Antonio Garcia Pascual, of Barclays Capital, told the Wall Street Journal. Credit ratings agency Fitch also reported last month that it considers an Ireland-style complete collapse of the banking and property sector to be “an extreme scenario which is not likely to materialize.”

With property sales having reported a positive growth of 5.9% last year for the first time since the market downturn, and new developments having all but ceased, allowing home supply to be soaked up in relation to demand, it looks as though the Spanish economy and real estate industry is beginning its slow road to recovery. Providing it can remain in investors’ good books in the coming months, the future is looking increasingly bright. Certainly if Tenerife’s recovering property market is to be used as an indicator, light has appeared from the end of the tunnel.

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

Time running out for second homes tax breaks

March 24, 2011 – 9:44 am

Time is running out for tax breaks on second homes

Time is running out for holiday  owners to upgrade their property while simultaneously cutting their tax bills. A £30m tax break, which cuts the cost of second homes for more than 65,000 families, is to be withdrawn next month because of EU laws. Attractive tax incentives were introduced in the eighties to encourage people to invest in quality holiday properties in Britain, after the lure of cheap Spanish packages left our many seaside resorts struggling, and in decline. They provided budding UK landlords with a meaningful subsidy towards the purchase and running costs of a second home, as well as more tax concessions when it came to selling. About 65,000 families currently own and run a holiday house in Britain under this tax regime, known as the furnished holiday letting rules, and save an estimated £30m a year in tax. But advantageous treatment of UK holiday property fell foul of EU laws, because they were deemed to discriminate against tourist accommodation in Spain, Portugal, France, Italy and elsewhere in Europe. Either the tax breaks had to be extended to all holiday properties throughout the European Economic Area (which includes Iceland, Liechtenstein and Norway as well as other EU countries); or they had to be withdrawn. The Government calculated that it would add up to £25m to the existing £30m cost of running this scheme if these overseas properties were included. By contrast, cutting this relief would bring an extra £20m into Treasury coffers. From April, losses can only be offset against future rental income and not used to reduce your overall tax bill. Source: Telegraph Online

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

EU citizens helped by Cross-Border Healthcare Directive

March 21, 2011 – 10:03 am

Eu directive may help Brits who travel to Tenerife and Spain.

For second home owners regularly travelling to their property in Europe, obtaining insurance to ensure you’re covered for any accidents that could occur abroad is at best an annoyance, at worst a hefty extra cost. Luckily, if you’re a citizen of the EU or UK travelling to another country within the Eurozone, all that is about to change.

By 2013, all EU citizens will be able to claim back for medical treatments they receive in other European countries, with or without travel insurance. The new Cross-Border Healthcare Directive, ratified in Brussels last month by all Eurozone states, will benefit both short-term travellers encountering those pesky ski accidents, and retirees who divide their time between, say, the UK and a second home in the Mediterranean.

For the latter category, healthcare has been a particular problem previously. As well as not qualifying for free healthcare in the EU, British citizens who spend more than 184 days a year abroad are also discounted from receiving NHS treatments. The new law should simplify the process for this expat category, ensuring they can receive medical care whether they spend the majority of time in France, Spain, the Canary Islands, the UK or anywhere else in Europe.

Despite the EU executive’s estimation that cross-border healthcare will only take up a mere 1% of total health spending, the new laws (which must be implemented by all states within 30 months) have met with some resistance in the UK. “The rules will turn the UK’s NHS into a bureacratic nightmare”, said UKIP leader Nigel Farage. There are also concerns that some countries may be late in doing their part to implement the laws, as Spain, particularly, has been slow to implement many health and insurance-related resolutions from the EU in recent years.

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

EU may force Spain’s hand over retiree benefits

March 14, 2011 – 9:57 am

EU rules may mean better rights for retirees in Spain and Tenerife

The EU may force Spain’s hand over retiree benefits. The European Commission took Spain to court for refusing to grant pensioners from other EU countries who live temporarily in the country access to free medication. European Union legislation gives pensioners who live temporarily in another EU country the same access to health care as retirees from their host country, if they present a European health insurance card. The EU’s executive arm accused Spain of discriminating against foreign pensioners by not granting them equal access to free medication, a right for retirees under Spanish law. The commission decided to bring its case to the Luxembourg-based European Court of Justice, which could force Spain to modify its law. “The Commission takes the view that Spanish rules are not in line with EU law as they discriminate against pensioners from other EU member states,” the commission said in a statement.

Certainly this  would be great news for British pensioners living in Spain, Tenerife and the Canary Islands

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