Rental prices fall in Spain’s cities

February 3, 2012 – 10:25 am

Rental property prices fall in Spain and Tenerife

Rental prices fell in 77pc of Spain’s primary rental markets (cities), according to a study by Spanish property portal Idealista and the Public Rental Company(SPA).

Rents fell the most in Toledo (-8.7pc) and Oviedo (-6.8pc) but rose in Lleida (+11.2pc), Bilbao (+4.2pc), and Alicante (+4.1pc).

The average cost of renting a home in Spain declined in 2011, as you would expect with property prices falling.

In Spain’s biggest cities, rental prices fell 1.3pc in Madrid, 3.1pc in Barcelona and 4pc in Valencia.

The latest annual rental decline follows a bigger decline in 2010, so the cost of both buying and renting a homes in Spain has been getting cheaper for several years.

The study was based on 38,000 properties listed for rent in the 12 months to the end of December.

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

TINSA and government house price index shows falling prices

February 2, 2012 – 10:37 am

Tinsa and government index shows property sales in Tenerife and Spain down in 2011

The House Price Index published by the Department of Housing shows house prices falling 6.8pc in 2011, and 19pc since the peak

Last week it was the appraisal company Tinsa’s house price index showing prices down 8pc in 2011. Now it’s the turn of the Government to publish it’s housing price index for 2011, showing a broadly similar decline of 6.8pc over 12 months to the end of December .

Both the Tinsa index and this one show  a double-dip starting at the end of 2010 and price-falls accelerating in the course of 2011.

After adjusting for inflation, Spanish house prices fell 9.6pc in real terms in 2011. So anyone with an inflation proof income (the majority of Spaniards with indefinite labour contracts) saw the real cost of buying a house fall by 10pc last year, or more if you include the 50% reduction in VAT on new homes.

Prices fell the most in Aragon (-10.4pc), Madrid (-8.2pc), Andalucia (-7.8pc) and Catalonia (-7.7pc), and the least in The Basque Region (-3.1pc), Asturias (-2.7pc), and Extremadura (-2.1pc). According to Fernando Encinar, head of research at the  Idealista, “there is no reason to think that anything is going to change in 2012.”

Of course you have to take all the official figures with a large pinch of salt. If the official index shows declines of 6.8pc, the reality was probably something between 10 and 15pc.

Soon to be published, and all that remains to be seen for 2011, is the official House Price Index from the National Statistics Institute, which should come out in the next month or two, and which tends to be used by the international press. Based on past form it will probably understate price declines more than any other index, which partly explains why so many articles in the international press say that Spanish property prices haven’t fallen enough.

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

Martinez new director for housing, land and architecture.

January 20, 2012 – 7:26 pm

Pilar Martínez  is the new Director of Architecture, Housing and Land for the national government in Madrid. She takes over a tricky post from Beatriz Corredor, the former Secretary of State for Housing under the Socialist Government.

Her office is part of the Ministry of Public Works and she will report to Ana Pastor, the new Minister in charge of that department. Martínez previously worked as head of housing in Madrid’s municipal government.

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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.

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3.4 Million Spanish homes are empty.

December 2, 2011 – 11:08 am

Too many empty homes in Spain

3.4 million Spanish homes lie empty, 13pc of the total housing stock  according to a new report from IDC. There are 676,000 empty homes in Barcelona and Madrid alone. Of the two, Barcelona has the biggest problem.

This is a “worrying situation with very negative consequences, principally a huge cost,” explains Carlos Parra, Director of IDC, quoted in the Spanish press. The empty homes are neither for sale nor for rent.

At the same time, tens of thousands of homes are being repossessed, and millions of young adults can’t afford their own home.

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Spanish property bargains

November 11, 2011 – 10:52 am

Property bargains in Spain and Tenerife

Despite dramatic property price reductions by many vendors across Spain, bargain hunters are taking advantage of the weak Spanish property market and are offering considerably below asking prices, fresh research shows.

 The latest figures provided by Idealista reveals that in September, the average offer made online through the Spanish property portal was 21.7% below the asking price. Having analysed over 500,000 offers since January 2011, Idealista’s research found that January, March and September are the months with the greatest volume of offers made by purchasers, whilst June was the weakest month in terms of demand. Spanish property investment opportunities The majority of Spanish property investors – 73% – believe that the Spanish property market will improve within the next 18 months, according to a new survey.

The latest study by international property consultants CB Richard Ellis found that three in four Spanish property investors expect market conditions to improve, despite the fact that prices are still falling across many parts of the country. The latest property investment barometer from CB Richard Ellis showed that Spain is expected to improve in early 2013, while 57% of those surveyed said they planned to invest in the Spanish property market within the next 6 months. The majority of investors are interested in buying commercial properties, rather than residential, with half of investors looking to buy offices, while 40% are interested in prime shopping centres. Just 7% of investors said that they plan to buy residential property.

A lack of mortgage liquidity remains a major stumbling block in Spain, which is why three in five investors believe that foreign investors with greater access to financing will drive the market recovery. Take advantage of the weak Spanish property market Domestic investors are taking centre stage in Spain’s investment market making up 66.2% of investors in Q1-Q3 2011, up from 33.3% in the same period in 2010 according to international real estate advisor Savills. Total volume in Spain’s investment market totalled almost €1.25bn (£1.07bn) in the first three quarters of 2011. The firm notes that as well as ongoing sales of large mixed use portfolios which banks are attempting to remove from their balance sheets, local authorities are also selling assets to gain liquidity.

Both the Andalusian and Catalan Regional Governments have portfolios on the market, including well-located office assets, which Savills observes are attracting interest from both opportunistic and core investors. Danny Kinnoch, international investment director Savills Spain, says: “In recent times there has been a two tier market with opportunistic investors focused on portfolio and large scale individual deals while the more traditional core investors remain focused on well-located, high-quality assets with high occupancy rates and solvent tenants on long-term lease contracts. Domestic investors continue to dominate the core market but international players remain on the lookout for opportune deals.” According to Savills major international players including Orion, RREEF, Generali Lend Lease, Doughty Hanson, AXA, Perella Weinberg and Rockspring have all been active this year. Savills has observed increased investor interest in Spain’s hotels market, a shift from the historically dominant retail and office markets and a reflection of the strength of tourism in a challenging economic climate. Key deals in the first three quarters of 2011 include Grupo Millenium’s purchase of two hotel assets, Hesperia Madrid from Hesperia for €80m (£69m) and Tryp Centro Norte from Colonial for €30m (£27m), both in Madrid as well as Mansion Services’ acquisition of Intercontinental Madrid from Morgan Stanley for approximately €68m (£58m). The total investment volume Q1-Q3 represents a fall of 52% compared to the same period in 2010, but with more realistic pricing and improved market sentiment Savills expects 2012 investment volumes to improve on 2011. Kinnoch says: “With an improvement in market sentiment in relation to other Euro countries combined with more realistic pricing taking into account the macro-economic situation in Spain, we expect 2012 investment volumes to exceed those of 2011.”

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Investors in Tenerife and Spain benefit from more rental opportunities

July 19, 2011 – 12:26 pm

Rental opportunities in Tenerife increase

Investors interested in property in Spain could benefit from more rental opportunities as more Brits choose to holiday in Europe. 

According to a new study by Abta – The Travel Association, bookings to Spain have increased by 11 per cent compared to last year, showing that the destination is becoming more popular with holidaymakers.

Short breaks are also seeing more people travelling into the country, especially to Madrid, as economies around the world recover and capital has been freed up to boost overseas stays.

“During the recession, luxury holidays were substantially affected, but have now experienced a healthy comeback,” Abta said in a statement.

Source: International Business Times

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British still buying in Spain and the islands

June 10, 2011 – 8:47 am
  • Tenerife and Spain are  still  favourites  with British buyers.

    The price of free-market housing in Spain has dropped on average by 15.4% (more than 20% in real terms and as much as 24% in some provinces).

  • In municipalities with more than 25,000 inhabitants there has been an average 25% decrease, while in certain coastal towns the drop has been even greater. Such is the case in Marbella (40%), Torrevieja (31%) and Ibiza (29%), for example.
  • In 2010, property purchases by foreign residents in Spain increased by 20.8% over 2009.
  • In 2010, the British accounted for 23.4% of all property purchased by foreign residents in Spain.
  • In 2010, 491,000 property sales were recorded, 6% more than in the previous year and the first increase after three years of downturns; 60% of sales were in the Mediterranean coastal regions and in Madrid.
  • The number of empty housing units stands at less than 700,000 units in 2010; 61% of these are concentrated in the Spanish coastal regions.
  • The volume of finished housing has fallen by 60% in 2010 compared to the peak year of 2007, while newly constructed approved housing has fallen by 90% in 2010 from its 2006 high.
  • At present, the construction of subsidised housing (VPO) accounts for 50% of all new housing. As a result this type of housing now accounts for 11% of all residential real estate in Spain.
  • 1/3 of Spain’s more than 25 million houses are holiday homes.

    • Certainly in Tenerife and the Canary Islands the housing market is showing signs of improvement once more and their are good quality prime property bargains to be had at present.

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

    Lorca hit by earthquake

    May 16, 2011 – 11:36 am

    Earthquake hits Lorca,Spain

    Two earthquakes struck the Spanish town of Lorca, leaving at least nine people dead and 130 injured in the most deadly tremors to hit the country in more than 50 years. Seismologists described the quakes, measuring 4.4 and 5.2 on the Richter scale, as ‘moderate’ but they still seem to have damages more than 20,000 buildings and resulted in the majority of the 90,000 residents of Lorca spending the night outdoors.

    It is believed that many of those who died, including one pregnant woman, were killed by falling masonry during the second quake, having sought refuse in the open after the first tremor.

    Lorca is a medieval town in the Murcia region, where many ancient buildings and streets are said to have been damaged by the quakes. The shocks hit Lorca just before 7pm and could be felt as far away as Madrid. Thousands of people spent the evening and night in the open air as they were unable or too scared to go back into their homes. Some 350 ambulances ferried more then 400 people to hospital.

    Some villages in the surrounding area are said to have had damage to every single building, while in other places people were today allowed to return home. Spain endures hundred of earthquakes every year, with Murcia being the most seismically-active part of the country – though the vast majority of tremors are far too small to be felt.

    Source: BuyAssociation.co.uk

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

    Housing glut to shrink to manageable level by 2013 says Spain’s Ministry of Finance

    May 5, 2011 – 10:13 am

    Housing glut lasts in mainland Spain but improves in Tenerife and the islands

    In a drive to reassure international money markets that Spain can deal with its real estate problems, the Ministry of Finance has claimed that Spain’s infamous housing-glut will shrink to a manageable level of 200,000 homes by 2013.

    For that to happen Spain will have to sell 900,000 new homes between now and then (300,000 per year), whilst building around 175,000 new homes on average per year. In the chart above, the dotted line forecasts the new housing inventory in 2013.

    Some experts have raised doubts that the market will be able to digest 300,000 new homes per year, bearing in mind that resale transactions must also be taken into account.

    According to the latest figures from the Government (Fomento) and the property register, analysed in an article by El Confidencial, the net change in the number of new homes on the market over the latest 12 months was a decline of just 30,000, way below Government estimates for the next few years. If that rate continues it will take several years longer to digest the glut. The Government also produced an analysis of the relationship between price falls and the stock of new homes on the market in different areas.

     Madrid and coastal provinces of mainland Spain, where most holiday-homes are located, tend to have the largest gluts and price falls. However the islands such as Tenerife and Majorca have seen an upturn in prices this year

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