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)

Tinsa price index latest results

March 23, 2011 – 9:41 am

Tinsa index now shows positive signs for the property market in Tenerife

The Tinsa Spanish House Price Index for February (change over 12 months) is  as follows:

National average -4.5pc
Big cities – 5.2pc
Mediterranean Coast -6.7pc
The Balearics & Canaries -0.8pc

Peak-to-present:

Mediterranean Coast -27.2pc
Capitals -20.6pc
The Balearics & Canaries -17.5pc

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

Serious vendors dropping prices to ensure a sale.

July 25, 2010 – 2:25 pm

Serious sellers in Tenerife and Spain drop prices to ensure the saleA growing number of vendors trying to sell their homes are dropping their asking prices, according to new research by one of Spain’s leading property portals. Asking prices for 18,007 resale properties in the Idealista database were reduced in June, 30% more than same time last year, and the highest level for 2 years. The number of price reductions has been on the rise every month since January, causing the 12-month average trend to rise after falling for about a year. But if the number of discounted properties is growing, the average discount value is not. Discount values peaked at the beginning of last year and have been declining ever since, so it’s a story of more, but smaller discounts.

The markets where the biggest proportion of vendors decided to drop prices were Madrid (9.3%) and Barcelona (7.4%). That means vendors in Spain’s two biggest markets are becoming more focused on finding a buyer.

- Asking prices were down just 0.5% in Q1 over Q2, to 2,374 €/m2.
- Prices rose in 5 regions: The Balearics (+2,4%) Galicia (+1,6%), Castilla y León (+1%), The Basque Country (+0,9%) y La Rioja (+0,6%).
- Prices rose just by 2 €/m2 in Barcelona, to 4,084 €/m2. Even so, prices there are still below where they were 5 years ago in Q1 2005. They are down 16.4% from the peak of 4,888 €/m2 in Q1 2007.
- Madrid fell 0.4% in Q1, to 3,831 €/m2, 11.2% below the peak of 4,315 €/m2 in Q2 2007.
- Valencia fell 0.7% to 2,335 €/m2, 18.4% below the Q2 2007 peak of 2,861 €/m2

Sellers in Tenerife and the Canary Isles are  also following this trend to ensure a quick sale.

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

Are Property discounts what they seem?

January 17, 2010 – 2:54 pm
Property discounts in Spain and Tenerife,are they all that they seem?

Property discounts in Spain and Tenerife,are they all that they seem?

There is no shortage of price promotions being touted, for example Metrovacesa’s December promotion of 1,500 homes with alleged discounts of up to 52%, and Banesto’s November promotion of 1,200 homes with alleged discounts of 40% (Metrovacesa is one of Spain’s biggest developers, and Banesto one of its biggest banks).

But when  real estate experts what they thought of the discounts, scepticism was the order of the day. “One has to interpret these discounts and ask what levels they are calculated fromDi,” said Ernesto Tarazona, Corporate Recovery Director at Knight Frank España.

After all, what good is a discount if it is applied to some unreal starting price? According to the experts consulted for article, in many cases today’s discounts are based on the demented valuations used at the height of the boom, arguably irrelevant in today’s straightened economic circumstances. Supporting this position is a recent report on the Spanish property market  stated that prices are still close to 30% over-valued, and the valuations used by banks and savings banks (cajas) “do not reflect true values and result in a general over-valuation of property.”

That said, you might still get lucky and get the odd bargain,  especially holiday homes on the coast.

Just look at the published accounts of developers for the third quarter of this year, says the article. Their gross margins are still positive, implying that they are selling above the crazy prices they paid for land in the boom, if they sell at all, that is.

The real question is why are prices so high, even with the alleged discounts? Because neither banks nor developers are prepared to sell at a loss whether in Tenerife or Barcelona, explains the article. New accounting rules from the Bank of Spain may change that, but for the time being the discounts on offer are not really discounts at all, at least not compared to today’s market prices.

For my money I would say that will all change in 2010, one way or another.

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

Property prices continue to improve.

November 17, 2009 – 5:20 pm
In Tenerife and the Canary Islands, property prices are beginning to recover once more.

In Tenerife and the Canary Islands, property prices are beginning to recover once more.

Tinsa property price index for October shows that average prices fell by 7.4% over the last 12 months. That’s the smallest fall in a year. Peak to present prices are down just 13.5%.

Even property on the coast showed a marked improvement, with year-on-year prices down just 9.9%, the first time the fall was not in double digits since November last year. Tenerife and the Canary Islands property  is beginning to improve sales wise once more.

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

Long term buy to let back on the agenda in Tenerife?

October 4, 2009 – 12:41 pm
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Buy to let can be a good investment once more in Tenerife

Buy-to-let properties may not offer a short-term profit for landlords, but in the long term, they can provide a good return, according to  industry professionals. The number of new tenancies is increasing while property oversupply is dropping. If a landlord can find a house for the right price, then there is scope for a good long-term return on the capital invested.

If you’re a cash-rich landlord and you understand the market, it is a good time to get into the market if you buy the right type of property and your local estate agent  in Tenerife will be able to show you a variety of properties, from one bed apartments to villas with a sea view that should fit the bill at be at the right price.

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

Spanish property tours to visit England

September 11, 2009 – 4:05 pm
Spanish property exhibitions to visit England

Spanish property exhibitions to visit England

Taylor Woodrow will mark its 50th anniversary by touring England with a series of Spanish property exhibitions throughout September.

The exhibitions will offer people looking to buy property in Spain information on Spanish homes and locations, plus Spanish properties that have been reduced in price by up to 41 per cent, to reflect the recent slump in the Spain property market.

Victor Sague, Marketing Director of Taylor Woodrow de Espana, said, ” From talking with our estate agency partners in the UK, we expect there to be significant interest in these offers from both investors and second home hunters.”

Experts will be on hand to advice house hunters at each of the exhibitions, which will be held around England from Sunday 13-23 September.

There are many homes available in seaside and golfing locations throughout Mallorca, Costa Blanca, Gibraltar and Marbella,  Tenerife and the Canary Islands. A  high number of homes will be sold throughout the couple of weeks of exhibitions as it will provide house hunters one last chance to buy a quality home at a fantastic price. It really is now or never for people to take advantage of these top quality homes as these discounts will not be around for long.

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

Banks will start lending when prices stop falling

July 28, 2009 – 3:26 pm
Banks in Spain will lend again when property prices stop falling

Banks in Spain will lend again when property prices stop falling

The president of the Spanish banking association, Miguel Martin, said recently that banks will start lending again when “the fear of a property price collapse” has passed. When that happens, the solvency of buyers will improve as a result, he argued.

Speaking at the recent property sector trade fair in Madrid, Martin explained that “with greater demand and stable prices, or without the fear that prices will collapse, borrowers will see their solvency and collateral improve, and credit will start flowing again.”

At the same event, José Manuel Galindo, president of the APCE developers’ association, drew attention to the role played by banks in causing Spain’s property market slump. He called on banks not to discriminate against clients buying property from developers, accusing them of unfair competition for offering better mortgage financing terms to clients who buy property from the banks

By Angela | Posted in Economy, General, Miscellaneous Articles, Property, Tenerife, Uncategorized | Tagged , , , , , , , | Comments (1)

British Expats gain better quality of life and are financially better off

July 26, 2009 – 1:09 pm
British Expats enjoy a better quality of life in Tenerife

British Expats enjoy a better quality of life in Tenerife

British expats who have moved abroad are gaining a better quality of life and becoming financially better off.

That’s the view found by the latest NatWest International Personal Banking Quality of Life Index, carried out in conjunction with the Centre for Future Studies.

They surveyed British expatriates from across the world and discovered that, despite the global economic downturn, 98 per cent said they had made a good decision when they chose to move abroad.

For 62 per cent of people, the move abroad was triggered by a feeling of dissatisfaction at home. Life abroad is better than expected for 86 per cent, and 92 per cent claim to be happier living abroad than they were back home in the UK. Encouraging news for anyone thinking about doing the same.

It’s good news on the financial front too, as 87 per cent of expats said they believed they were better off now, despite the recession. Sixty three per cent of people had left the UK with less than £5,000 in savings, but working abroad doesn’t seem to have posed too much of a problem – seven out of 10 people now earn between £50,000 and £85,000 per year.

The research also looked at the countries offering the best quality of life. The number one spot was taken by New Zealand, which was rated top-notch for its low cost of living, low property prices and favourable tax regime.

Spain and Tenerife in particular are still very popular because of the great climate, particularly Tenerife and the quantity, price  and ease of flights from and to the UK

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