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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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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Spain’s youth leave the country to find employment

March 12, 2012 – 9:40 am

Tenerife and Spain's youth struggle to find employment

Spain’s high unemployment rate of around 23% means many Spaniards, young people in particular, are leaving the country to find work elsewhere. One popular destination is Germany, where the jobless rate is under 7%. But starting afresh in a new country is challenging.

Munich’s airport shuttle bus is dropping off newly arrived passengers in the city centre. Among those getting off are Spaniards Jose Sandino and Juan Alberto Fuente.

Sandino and Fuente are thirty-something industrial engineers from Malaga, in southern Spain. Each has more than a decade of experience under his belt. But Spain’s economic crisis has left them jobless. And now it’s turned them into immigrants.

Source: BBC.co.uk

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“Demand Thermometer” tool shows difference between asking and offer prices

March 6, 2012 – 11:38 am

Asking prices differ compared to buyers expectations in Spain and Tenerife

The “demand thermometer” tool from idealista, one of Spain’s leading property portals, allows us to see the difference between asking prices and what house-hunters are offering. On average, house-hunters offered 23pc less than asking prices in January, according to Idealista’s demand thermometer.

The biggest difference between asking prices and offers was in Malaga, home to the Costa del Sol, where house-hunters offered 29pc less than asking prices, followed by Soria (-28pc) and the Balearics (-27pc).

Differences of more than 25pc were also to be found in Girona (Costa Brava), Tarragona (Costa Dorada), Castellon (Costa Azahar), Murcia, and Almeria (Costa Calida), all popular locations with foreign holiday-home buyers.

So it seems there is still a big gulf between vendor expectations and what buyers are prepared to pay throughout Spain, Tenerife and the islands.

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

Spain and Tenerife look popular for holiday home rentals in 2012

February 20, 2012 – 10:48 am

Spain and Tenerife property holiday rentals increase for 2012

More Spanish holiday home owners are looking to rent out their properties this summer with data showing that the supply of holiday rental accommodation in Spain grew sharply in the last quarter of 2011.

Demand from holiday makers has stayed strong, according to the UK’s largest holiday home rentals site HomeAway. Its latest report shows that Spain is the tenth best performing market in terms of growth in inventory on its website, the first time the country entered the top ten last year.

Due to the tough resale market in 2011 it would seem more Spanish holiday homeowners looked to rent out their properties to help cover costs, it suggests. Now, as property prices are largely thought to have bottomed out, Spain is again becoming one of the most attractive investment options for Brits.

The country also performed well on the demand side too. Overall, booking enquiries for Spain in 2011 were up 27% compared to 2010 and Malaga was the fifth most popular destination for holidays in the last quarter of the year.

Source: PropertyCommunity.com

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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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Juzcar happy to be left Smurf blue

December 23, 2011 – 2:11 pm

Spain's blue town is loved by Smurfette

It was meant to be a short-lived publicity stunt for a film that became a box-office smash despite withering reviews. But for the 221 inhabitants of Juzcar in southern Spain, The Smurfs in 3D has brought them an unexpected lifeline in tough economic times and yesterday they voted overwhelmingly to keep it.

The tiny pueblo of white-washed buildings near Malaga in Andalucía was selected by the filmmakers this summer to be painted entirely in that unique hue, Smurf blue.

While Sony had promised to return the village to its former glory after filming and publicity, the residents have found that being blue is not so bad at all, and yesterday in a referendum voted 141 in favour and just 33 against to remain the world’s only Smurf village.

Ever since the pueblo was converted into the set of Smurftown for Sony’s hit, it has been cashing in on its new-found celebrity status. Previously, about 300 tourists a year would pass through Juzcar. In the past six months, an estimated 80,000 followers of “Los Pitufos”, as the Smurfs are known in Spanish, have made the trek to the remote village high in Malaga’s sierras.

Source: Independent.co.uk

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Spanish rental property still tops

December 9, 2011 – 10:36 am

Spanish rental property still tops with the British

Overseas property buyers can get an idea of where they are likely to find a good rental market for their holiday home from a new survey that reveals Spain has been the top destination of 2011.

The quarter three Marketplace Report from holiday rentals specialists HomeAway also shows that there has been an increase in the rentals market in Thailand and Dubai.

More British people than ever opted for Spain as their top summer destination. In terms of the number of booking enquiries for breaks in the third quarter of the year Malaga Province and Majorca claimed first and second place, followed by Ibiza in sixth place.

There was also a clear preference towards short haul destinations with nine out of the top ten destinations for summer 2011 holidays being either in the UK, or within a three hour flight distance.

Source: PropertyCommunity.com

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New brand created by tourist board to encourage Brits to buy a home

November 29, 2011 – 9:13 am

Costa del Sol brand designed to encourage Brits to buy homes.

The Tourist Board of the Costa del Sol has created the new brand ‘Living Costa del Sol’ with the aim of encouraging the British to buy a home and reside in the region for at least six months of the year, an initiative which is directed at clearing some of the surplus of about 30,000 homes.

The President of the organisation, Elias Bendodo, presented the brand at the World Travel Market tourism fair being held in London this week. He also told reporters that it is their intention that this initiative will also be used in promotional activities to be carried out in Germany, France and the Nordic countries.

According to Bendodo, ‘Living Costa del Sol’ was developed in collaboration with developers, insurance companies and financial institutions, and aims to attract new British residents, reduce the amount of unsold finished homes, located primarily in the west of the Spanish mainland, and boost Spain’s economic recovery.

The President of the Malaga organisation also assured that the developers are “fascinated with the idea”, and stressed the importance of having legal guarantees, for working with insurance companies in the countries to which the brand is focused, reported El Mundo.

Source: Kyero.com

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Low rental yields in Spain.

May 23, 2011 – 9:59 am

Low rental yields (gross) imply that property prices have not fallen enough, according to new research by Idealista.com.

The highest gross rental yields in Spain are to be found in the Catalan province of Lerida (4.7pc), followed by Las Palmas in The Canaries (4.5pc) and Málaga, home to the Costa del Sol (4.3pc). These rental yields imply around 22 years of rental income to pay for the average property.

The lowest yields are in the North of Spain, with yields of just 2.9pc in the Galician province of La Coruña. That means the average property in La Coruña would cost almost 35 years of rent.

Idealista calculated rental yields per province for Q1 20011 by dividing the average rental asking-price by the average sales asking-price, both in terms of €/m2. Asking prices are not a perfect guide to market prices, but they are the best guide we have.

These figures do not distinguish between primary and holiday homes, and probably overstate expect gross rental yields for holiday-homes on the coast. Net rental yields for foreign owners are likely to be very low, in the 2pc range or less.

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