Victory in Spanish election to herald a change in Spain’s property market?

November 23, 2011 – 9:43 am

People's Party victory in Spain may help property sales in Tenerife

The landslide victory for the People’s Party in Spain’s General Election is hoped to herald an avalanche of change for the country’s property market. The Centre-Right party’s triumph follows elections in Greece, Ireland, Italy and Portugal as Spain becomes the fifth Eurozone country to switch government this year. The real estate industry is now urging the government to act, as thousands of discounted homes across the country remain unsold. Tax cuts and tourism initiatives are two of the measures anticipated by property professionals, as Spain’s appeal to lifestyle buyers remains strong, partially helped by the existing VAT reduction for new homes. “Spain still has arguably the best weather in Europe, is easy to get to and property is relatively cheap,” Spanish agency Mercers commented,  while house builders such as Taylor Wimpey have seen success by slashing VAT altogether. Marc Pritchard, Taylor Wimpey’s Sales Manager, comments: “We initiated the NO VAT policy as a way of assisting potential buyers further especially seeing as buyers have executed caution when committing to Spanish property. Indeed, we have seen considerable interest in our VAT free properties since its introduction and with only weeks to go before this rare time-limited opportunity for investors to purchase their dream home in Spain VAT free ends, we are urging property hunters to invest now before it too late.” As with the UK, unemployment is a central component to Spain’s recession, particularly for under-30s, and tax changes by the PP could create jobs as well as stimulate investor interest. In Motril, for example, an ambitious land development was scrapped when the market crashed. But plans have since been changed to a reworked “sporting and marina complex” that could create 1,000 jobs, as Spanish developers look for new ways to encourage investment. The council’s chief architect Juan Fernando Perez Estevez explains to Reuters: “It is something that will attract high-end customers who will need services. And it will be the catalyst for further activity. We’ve got the infrastructure, the motorway, so this is an important development that will attract investment.” Construction has always been a key source of jobs in Spain. At the peak of the housing boom, construction,when the People’s Party (dubbed the “Pro Property Party”) were last in power, 2.8 million people were employed in the building sector, but this has now dropped to 1.4 million – just 7.8 per cent of the working population. With unemployment high, Spaniards cannot afford new homes and banks continue to repossess property. With many seized assets turning sour, banks are losing out on billions of Euros, yet the Bank of Spain accused them in recent months of “holding back” the best properties until house prices have returned to higher levels. Around 600,000 “bottom of the market bargains” are currently available on the market, according to Property in Spain. And so Spain relies on overseas buyers to boost demand. Hopes reside in the new Spanish government, recognised as taking the problem more seriously, to continue selling off land assets in prime locations and encourage foreign investment. If the Eurozone remains stable, Reuters adds, “Spain can rebuild”. Some, including Property in Spain, are looking for immediate solutions: “The new Government has one month to the start of the New Year buying season to come up with enough incentives and safeguards to get more buyers tempted by the genuine bargains and mortgage deals on offer.” As the industry awaits new incentives to clear the large stock of discounted homes, prime Costa property at cheap prices is expected to eventually bring back international buyers to the country’s sunny coasts. According to a forecast from Bankinter last week, Spain’s supply will last for several years, but houses are predicted to become even cheaper for buyers, with prices falling another 6 per cent by 2013. It is a long road to recovery but in time, the PP’s acronym may stand for “Pro Property” once again. “There won’t be any miracles. We never promised any,” said the Prime Minister-elect Mariano Rajoy, who will be sworn into office in December. “But as we have said before, when things are done properly, the results come in.”

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

If Spain had kept the Peseta……..

November 18, 2011 – 3:26 pm

If Spain had kept the Peseta would the property crisis have been as bad?

If Spain had kept the Peseta the bubble would never have been so big, claims Max Otte, an economics professor and fund manager who forecast the crisis in a book published in 2006.

Otte explains that low interest rates that came with Euro-zone membership are the root of the problem. Egged on by the banks, Spaniards binged on cheap mortgage credit and drove the property market into a frenzy, making a traumatic bust inevitable.

Given where we are now, Spain would have been better off with higher interest rates and steady growth outside the Euro-zone, argues Otte in comments reported in the Spanish press. The boom years were no worth this bust.

He also claims it’s only a matter of time before Greece abandons the Euro, and recommends that Spain does so too. The Euro has been a waste of time and money, says Otte.

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

Spanish property hangs on to most of the boom time gains

November 14, 2011 – 9:41 am

Spanish property hangs on to most of the gains from the boom years

Spanish property has managed to hang onto most of the capital gains it made during the boom, at least according to official figures. Other Eurozone countries have fared worse.

During the boom, the only Eurozone countries that experienced higher property price inflation than Spain (+155pc) were Ireland (+172pc) and Malta (+157pc), according to a new report from the European Commission.

Since the bubble burst, Irish property prices have fallen 38pc, and Maltese property prices by 11pc. In Spain, prices are down 22pc, according to the official house price index from the Government (-24pc according to the latest Tinsa index).

That means that Spanish property has managed to hang onto around three quarters of the capital gains it made during the boom, no mean feat given the economic crisis, credit crunch, and collapse in sales (Spanish property sales down 40pc in August alone).

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

Expat savers unlikely to see interest rates rise in the near future.

September 28, 2011 – 2:11 pm

Expats in Tenerife unlikely to see interest rates rise in the near future

Expat British savers are unlikely to see interest rates rising for some time and whatever currency they use face poor growth prospects, according to a leading UK bank.

‘Growth prospects in the UK, Eurozone and US have worsened following a series of poor economic data. This, coupled with low domestically generated inflation in those markets, makes it less likely that central banks will increase interest rates any time soon, says Trevor Williams, economist at Lloyds TSB.

‘In fact, we now forecast that the UK base interest rate will be held at its current, historically low level of 0.5% until the third quarter of 2012. In the UK, the market is becoming less focused on inflation and more pre-occupied with the prospect of weakening growth,’ he explained.

He pointed out that the UK job market, a key indicator of growth, has softened noticeably in recent months and the preferred measure of unemployment stayed at 7.9% in the three months to July, just off its highest rate in 15 years.

Source: ExpatForum.com

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

Vendors need to come to terms with drop in sale prices

August 16, 2011 – 3:48 pm

Vendors need to come to terms with falling property prices in Tenerife

The vast majority of private vendors still haven’t come to terms with the drop in the value of their properties, argues José Luis Jimeno, MD of Noteges – a real estate and executive education portal.

According to Jimeno, pictured above, only vendors who drop their asking price 40pc to 50pc below the competition in their area have a hope of selling. As a result, 80pc of private vendors are asking prices that are out of the market.

Vendors on the coast, where there is a large glut of holiday homes, are even worse off. To make a sale, they will have to accept offers 60pc to 65pc below the prices they are asking today, he claims. “Private vendors are still trying to sell at boom prices,” says Jimeno, quoted in the Spanish press.

But Jimeno is not the only expert with something to say about asking prices. Juan Fernández-Aceytuno, MD of Sociedad de Tasación, one of Spain’s leading appraisal companies, recently said that sales close on average 15pc below asking prices, according to another recent article in the Spanish press. If he is right, then asking prices are not so far from reality as Jimeno suggests

Looking ahead Jimeno expects house prices to continue falling thanks to the bleak economic outlook in Spain.

His advice to vendors is far from sugar-coated. “It’s not a good time to sell, but if you have no alternative then make the sale now, because with every passing day your home will be worth less.”

That advice is particularly relevant to British vendors, who have to take into consideration exchange rates. The Euro is still strong against the Pound, benefiting British vendors repatriating capital to the UK, but the way things are going in the Eurozone, that might all change.

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

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)

Cheap travel deals encourage property purchases in Tenerife and Spain.

February 8, 2011 – 9:46 am

Cheap travel deals to Spain and Tenerife encourages property purchases

British investors are being encouraged to buy property in Spain by the current cheap travel deals on offer, it has been suggested.

Sue Ockwell, spokesperson for the Association of Independent Tour Operators, noted that a growing number of Britsh people are choosing to travel and acquire property within the eurozone because of cheap prices and familiarity with the destinations.

“I think an awful lot of people are realising how lovely places closer to home are – France, Italy and Spain, for example,” she said. “There is so much to see and do in those places.”

The comments come after the recent Post Office Travel Services Holiday Money Report found that Spain is currently the cheapest eurozone destination and fourth placed worldwide, showing a price fall of 30 per cent for the same travel areas surveyed a year ago. This is part of a general trend, in which every eurozone country surveyed is cheaper than last year.

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

Economic woes drive overseas property interest

August 14, 2010 – 5:35 pm
Economic woes prompt property searches in Tenerife and Spain

Economic woes prompt property searches in Tenerife and Spain

The Capital Gains Tax hike and the start of the summer holiday season have had no real impact on interest in international property.

According to the latest Primelocation International Search Index, total searches for overseas property were down 7% in June but up by 138% on the same period last year.

The website therefore claims that financial pressures in the UK haven’t dampened interest, adding that other research indicates that one-third of international property searchers are looking to relocate abroad permanently.

The UK’s uncertain economic outlook could therefore be acting as spur for international househunters, particularly as many Britons are now facing more years in the workplace before retirement.

“The data, taken in conjunction with the results of the MyHomeLife panel research, indicates the increasing diversity of the international property market, encompassing investment buyers, relocators, semi-permanent movers as well as traditional second-home owners.While transactions have not yet recovered fully to return to their pre-crash levels, with finance and buyer caution remaining an issue in many cases, this broad range of different buyers is undoubtedly an important factor in explaining the current stability of the international property market.”

The Financial Times has reported that in June, Eurozone mortgage borrowing increased at it fastest pace in almost two years, indicating that confidence in property markets across the EU’s 16 member countries is returning.

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

European property prices to improve?

August 14, 2009 – 2:51 pm
European property prices set to improve?

European property prices set to improve?

Property prices across Europe are expected to fall at a slower rate as the economy starts to level out, according to a report released by Invista Real Estate Investment Management. Conditions for the economy in the eurozone during the first half of this year were the worst since it was formed, although signs are that things are starting to improve.

The European Central Bank reports that more European banks have increased their lending, while the cost of borrowing has fallen sharply. The report says that improving property yields could increase the long-term attractiveness of  investing in property.

Tim Francis, director, Continental European strategy and research at Invista, says: “With improved visibility on bottom-of-the-cycle valuations, we are in a better position to judge market pricing against fair value. This will assist in identifying attractive investment opportunities across these markets, some of which are experiencing distressed selling.”  We expect deal flow to improve during H2 2009 as the other mature continental European markets including Spain and Tenerife catch up.

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