Buying property abroad back on the agenda for Brits.

July 18, 2010 – 1:12 pm

Buying overseas property bank on the agenda for Brits

Buying overseas property bank on the agenda for Brits

A new report has illustrated just how disallusioned we are with ol’ Blighty - a third of all those considering buying property abroad are looking to emigrate permanently.

According to Primelocation International’s MyHomeLife Panel, 33 per cent of people looking to buy an overseas property are hoping to make their purchase into a more permanent home by emigrating to the new country.

Forget holiday homes - these buyers are looking for a forever home, far away from Britain. The main motivator behind their search was found to be this desire to build a better life elsewhere, revealed the research.

The trend outlined is particularly remarkable given that overall interest in international property is at record levels.

Just 23.7 per cent of respondents were on the hunt for a holiday home and a mere 12.4 per cent were searching for an investment property. A further 15.3 per cent of respondents were foreign buyers looking to purchase a UK property.

Ann Wright, International Development Manager at Primelocation International, said, “With the government warning of a period of austerity following the emergency budget, it is understandable that more people than usual would dream of emigrating away from the UK. However the fact that a significant proportion are actively searching for international property in a bid to make that dream a reality, comes as quite a surprise.

“Furthermore, the fact that barely one-fifth of those searching for international property agreed that the difficult economic climate has affected their intention to buy abroad suggests that poor financial prospects for the future are a driving factor behind Brits’ desire to emigrate. “With many in Britain now set to have to work longer before retirement, those who can afford to move abroad may feel they will not only have a better quality of life, but also benefit financially from leaving the UK. These potential buyers may well offer a small boost to international market activity over the coming months,”

So keen are people to make their new life a reality that, despite the uncertain economic outlook, barely one-fifth of respondents their intention to buy abroad had been affected by this. Just 9.8 per cent of people said that they were ‘having to be realistic’ and ’search for property in locations that they would not otherwise consider, due to affordability constraints.’

If you are one of the hoards hoping to kiss goodbye to Britain for good, check out properties for sale all over the island of Tenerife

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

Final month left to claim CGT charges or lose them.

July 17, 2010 – 10:47 am

Final month to get the extra CGT back for purchasers in TenerifeSpain is on cloud nine after winning two of the biggest sporting gongs in the world, but there is a rather more pressing matter for them to deal with - at least for the Brits who sold a property in Spain between 1997 and 2006 - who have just one month left to begin claiming back capital gains tax charged illegally on the sale of their home.

The Spanish Government illegally charged British people more than double the amount of Capital Gains Tax, (CGT) they owed on their properties between 1997 and 2006. The poor Brits who had chased the sun to Spain in search of sea and sangria were forking out a whopping 35 per cent under the ‘non-resident’s income tax’ bracket. Spanish nationals residing in similar homes were paying the proper rate - just 15 per cent of any capital gains. The overcharging is estimated to have raked in more than £350 million for the Spanish Government.

In 2009, following much outcry from British owners of Spanish properties and an expose by a group of Spanish lawyers and a UK based currency specialist, the European Court of Justice (ECJ) ruled that the tax contravened European Community Treaty rules against discrimination. They agreed that any UK or EU citizen who sold a property in Spain between 1 January 1997 and 31 December 2006 could claim back the excess charges.

Now, those affected by the illegal CGT charges have just a month left to make their claim or face losing out on the chance to get back what is rightfully theirs. All claims must be finalised and settled by the end of October this year - as August is considered to be a holiday month in Spain, sellers have just one month left to kick off their claims, which can take up to three months to be realised.

The average amount of money being recovered is around £15,000, so it is more than worth checking if you are eligible for a refund. More than 500 British families have already been successful with their claims.

Even if you have tried previously to recoup the money and not been successful, lawyers are saying that a second try is most definitely worthwhile as some of the rules governing eligibility have changed - indeed, the European Court of Justice have recently opened new legal actions allowing claimants to make a second attempt.  The industry  estimates that there are still thousands of Brits who sold Spanish properties during the eligible time period who haven’t come forward. So if you bought a property in Tenerife, the Canary Islands,  or mainland Spain, get that claim in pronto!

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

A good time to buy in Tenerife and Spain?

July 11, 2010 – 12:00 pm

A good time to buy property again in Tenerife, Spain and the Canary Isles.

A good time to buy property again in Tenerife, Spain and the Canary Isles.

Is now a good time to buy property in Spain and Tenerife? The current Minister of Housing says yes, the former Minister says no. 

Beatriz Corredor, the current Minister for Housing, recently said in an interview with the Spanish daily El Pais that now is an “optimum” time to buy a home in Spain. “We have a huge selection, low interest rates…..The fiscal and financial situation means that now is an optimum time (to buy).”

True, she was talking about primary residencies, not holiday homes. Even so, I’m sure she would argue that now is a great time to buy any kind of property in Spain. She was responding to the following question from El Pais:

“Your predecessor María Antonia Trujillo told El Pais on Wednesday that she wouldn’t buy a flat now, that prices should fall from the peak between 30% and 50%….What do you make of her comments?” Her predecessor  doesn’t think this is a good time to buy. “I’ve been looking to buy for three years. I would not buy now,” she told El Pais, also saying she hopes prices correct (by up to 50%) “as soon as possible”. Trujillo, who was Housing Minister from 2004-2007, is free to speak her mind, unlike the current Minister, whose job it is to talk up the market.

So, who is right? Corredor, the current Minister, or Trujillo, her predecessor? Is now a good time to buy a home in Spain? There is no doubt that now is the best time in years for cash buyers. Prices in coastal areas have fallen by up to 50% (or more), there is more choice than ever, and cash buyers can find good value for money (and a lot of over-priced rubbish too).  The economic situation is still dire, and prices might fall even further, especially for Spain’s glut of undesirable property. We  don’t think prices for prime and A-grade Spanish property are going to fall much further, so Corredor is probably right if you look just at these segments. Trujilllo may be right when it comes to the rest of the market.

The worst time to buy was during the boom, when prices went through the roof, quality crashed through the floor as the economy strained to build too many houses, and every cowboy ever born jumped into the business looking for easy money, financing wasn’t a problem then.

Are cash buyers looking for prime and A-grade property in a better position now? Certainly, so if you are planning that purchase in Tenerife, Spain or the other Canary Isles, now may well be THE time!

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

Real estate sector won’t recover until mid-2011 says Bank of Spain

July 4, 2010 – 5:15 pm

Real estate in Spain, Tenerife and the Canary Isles still undergoing a recovery

Real estate in Spain, Tenerife and the Canary Isles still undergoing a recovery

The Bank of Spain (BoS)  says the real estate sector in Spain, Tenerife and the Canary Isles,will remain in recession until mid-2011 at least.  Spain’s economic miracle of the last decade was largely built on an unsustainable bubble in the real estate sector. When that bubble burst, as it did in 2008, it sent the Spanish economy into a tailspin. In a new report released last week the Bank of Spain now says the real estate sector won’t start to recover until mid-2011, casting doubt on recent press reports suggesting a housing market recovery is already underway. Cheap credit sent property prices and housing starts through the roof. It was never going to last for ever, but the credit crunch made sure that it came to a particularly brutal end. When credit crunch struck, the house of cards collapsed. The BoS says that the “correction” is not yet over . “Residential (housing) investment will continue contracting until the middle of 2011,” says the report. In 2007 it peaked at 7.5% of GDP, way above the OECD average. Next year the BoS forecasts it will fall to 4%. At that point, residential investment as a percentage of GDP will have fallen below the minimum it reached in 1994, during the last recession.

All of which is bad news for the Spanish economy, dependent as it was on the real estate sector for jobs and growth. “The housing market adjustment has sever macroeconomic implications in the context of the recession,” says the BoS report. As a result of the property crisis, the sector has shed 2 million jobs. The BoS says that, by the time this drama is over, the property crash will have reduced the Spanish economy by 5.4% compared to the end of 2007.

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

Euro loans entice overseas investors to Tenerife.

June 20, 2010 – 5:22 pm

Euro loans helping with purchase of Tenerife and Spanish property

Euro loans helping with purchase of Tenerife and Spanish property

Overseas mortgage specialist, Conti, is convinced that UK overseas property investors who took out euro-denominated mortgages earlier this year are already seeing the benefits. Such a move would not only have allowed them to take advantage of cheap interest rates, but could potentially save significant sums of money if sterling appreciates against the euro over the next few years, as experts predict.

For example, an investor taking out a euro mortgage of €250,000 in February 2010 for a property in Spain, based on the exchange rate at that time of around €1.1 per £1, made a commitment of around £227,000 to pay off the loan.

The exchange rate has since improved to around €1.2 per £1, reducing the cost by £18,000 in just four months.

If the rise continues in favour of the pound to €1.3 over the next two years, the borrower would only have to find around £192,000 to repay the mortgage, reducing the cost by £35,000 in sterling terms, although mortgage costs and notaire fees need to be factored in.

Conti’s operations director, Clare Nessling, comments: “Even cash-rich buyers could consider taking out a euro mortgage until the exchange rate improves, at which point they can pay it back and ultimately reduce the price they pay for the property.”

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

Interest in buying property in Spain and Canary Isles is increasing

June 19, 2010 – 12:03 pm

Interest in buying property in Spain and the Canary Isles is increasing with more people searching for Spanish real estate in May, according to the latest index from Rightmove. Overall 58% of locations saw an increase in property searches, 42% saw a decrease and 0.2% experienced no change.
 
Half of the top time climbers in May were in Spain and its Islands There was also interest in South Africa but this is put down to curiosity generated by the World Cup football tournament rather than an increase in serious buyers. June is expected to see even more interest as football fever continues.

Interest in property in Tenerife and Spain increasing once more

Interest in property in Tenerife and Spain increasing once more

 

‘May was a great result for Spain, fed by returning confidence among buyers as the bad memories and headlines of last year fade. It’s always hard to let go of what your property was worth at the peak of  the market and accept times have changed, but vendors also seem more open and have much improved realism about prices necessary to make transactions happen,’ said Robin Wilson, Head of Overseas at Rightmove.

‘The improving Euro exchange rate is definitely playing a part, up 10% on January this year and 20% on January last year, meaning buyer’s budgets can go further,’ he added.
 
Moneycorp, one of the UK’s leading foreign exchange specialists, has also seen a rise in enquiries for Spanish properties, which amounted to an increase of 11.8% between March and May.

‘Throughout May, sterling gained good ground against a weak Euro. Having started the month at €1.14, the rate eventually reached €1.18 towards the end of the month. The pound has benefitted from economic data which continues to support the view that the UK recovery is gaining traction,’ said David Kerns, Head of Private Clients at Moneycorp.

‘In contrast, the Euro has continued to weaken, following news that Spain’s AAA credit rating had been downgraded. It was sent even lower when the European Central Bank warned that Euro zone banks faced writing off another €195 billion of bad loans. The increase in the Sterling/Euro exchange rate would have made properties within the Euro zone an increasingly more attractive prospect for Euro buyers, and explains the surge in interest.

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

Canarian property prices improving according to TINSA

June 14, 2010 – 4:56 pm

Canarian property prices beginning to recover?

Canarian property prices beginning to recover?

Spanish property prices are still falling, but less with every passing month, according to the monthly house price index published by Tinsa, one of Spain’s leading appraisal companies

Average Spanish property prices fell by 4.4% over 12 months to the end of May, show the latest figures from Tinsa. Prices actually fell a fraction compared to last month, even if they rose compared to the same month last year.Should the Tinsa figures be believed, the rate of decline in Spanish property prices has been slowing since June 2009, when it peaked at -10.1%. If the trend towards smaller declines keeps up, average property prices will be stable, or even growing slightly before the end of the year.

Prices have fallen the least over 12 months in coastal areas and the Islands, areas traditionally popular with foreign buyers looking for holiday and retirement homes. Prices are down just 4.1% on the coast, and 2.4% in The Canaries and The Balearics

On a peak to present basis (since prices peaked in December 2007), prices are down 16.5% nationally, 21.4% on the Mediterranean coast, and 12.8% in the Canaries and the Balearics. So anyone buying a property on the coast today should be getting a discount of 21% on average compared to 2007.

Tinsa’s figures are based on their own valuations, not actual transaction prices. Most of these valuations have been paid for by banks, and  they might not give a true picture of property prices . 

May Index
National: 1,906
Mediterranean coast: 2,035
Balearics & Canaries: 1,641

Peak Index (December 2007)
National: 2,284
Mediterranean coast: 2,590
Balearics & Canaries: 1,881

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

A chance to rent before you buy in Spain and Tenerife

June 6, 2010 – 10:30 am

A chnace to rent before you buy in Tenerife and Spain

A chnace to rent before you buy in Tenerife and Spain

Clydesdale and Yorkshire Banks have joined forces with Spanish bank, Caja Mediterraneo (CAM), to give Britons thinking of buying a property in Spain the opportunity to rent before they buy.

In addition, the scheme allows for rent to be discounted from the purchase price of a property should a tenant opt to buy within two years of taking out a lease.  The lenders can also offer property investor with a taste for Spain legal services provided by a UK-based solicitor with experience in Spanish property, and a Spanish bank account with access to CAM bank’s English Internet banking service.

According to Clydesdale and Yorkshire, a house in Spain is more affordable than ever right now, with discounts of up to 50% on previous asking prices.  Last month, Primelocation.com reported a sharp rise in overseas property searches, with Spain taking second place in the top ten destinations, behind France.

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

Notary fees cheaper in Spain after government cuts

June 5, 2010 – 5:20 pm

A reduction in notary fees on property purchases in Spain and Tenerife

A reduction in notary fees on property purchases in Spain and Tenerife

The government has announced a 5% reduction in notary and registry fees on property deeds as part of a package of measures to reduce the deficit and stimulate the economy. Notaries and Registrars are upset at this attack on their earnings, whilst house buyers will hardly notice the difference the savings are so small.

How big a saving will that 5% reduction in notary and registry fees give the average home buyer in Spain? Between €35 for a property costing €150,000, and €45 for a home costing €300,000, according to calculations done by Idealista.es, a Spanish property portal. Almost insignificant really.

Notaries and registrars are upset as the latter’s fees are already down by 50% thanks to the slump in property transactions.

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

Optimism for Spanish and Canarian property market.

May 30, 2010 – 10:41 am

Optimism returns to Tenerife and Spain's property market

Optimism returns to Tenerife and Spain's property market

The price of re-sale property in Spain and the Canary Islands increased in January for the first time in 24 months, according to   figures and other reports suggest there are tentative signs that part of the country’s battered real estate market is coming back to life.

Prices rose by 0.6% on average, with the regions of Cataluña, and La Rioja seeing the greatest recovery in price at 4.6% and 4.5%, according to figures from the real estate portal fotocasa.es.
 
Property prices also rose in the regions of Comunidad Valenciana, up 2,2%, Asturias up2%, Baleares with a 1,9% increase, Aragón up 1,4%, Galicia up 0,9% and Madrid up 0,7%.

While another index shows that overall Spanish property prices fell by 5.5% over the 12 months to the end of January. However, these figures from appraisal company Tinsa  are based on their valuations, not on actual selling prices. Activity in the real estate market is still very depressed.

The latest figures from the National Institute of Statistics shows that year on year the market shrank by 27% in volume terms to 372,000 transactions in 2009. They have fallen 48% since 2007 when there were 715,000 sales.

December 2009 had just 28,669 home sales, the second lowest level of monthly sales on record. But compared to December last year, sales were down just 1%. ‘That’s because by December last year, the market was already deep in crisis.

From now on, annualised comparisons won’t look so bad, and won’t give any indication how far the market has fallen,’ explained Spanish Property Insight.

‘When the market hit the skids, resale transactions collapsed much quicker than new builds, which outnumbered re-sales throughout 2009. In normal market conditions, it’s the other way around. As 2009 went by the two started to converge, and in 2010 re-sales may once again overtake new builds, though it does depends on whether banks are prepared to lend to resale buyers,’ he added.

Whilst there’s little doubt that life is returning to the Spanish property market, it still remains utterly price sensitive, according to Chris Mercer, director of Mercers real estate agents.  ‘We are making it our business to find realistically priced property from motivated sellers for serious buyers who are in a genuine position to make a purchase. The reality is that decent investment properties are out there, whatever the market, it just takes some expertise and effort to find them.’

If your property is overpriced you won’t sell and you’re wasting your own time and our time, whilst also giving the buyer an unrealistic view of the market. If you’re a motivated seller able to accept a realistic price for your home, we’ll find a buyer.

He also believes that for investors renting to local people can prove fruitful. ‘If you’ve got a 20% deposit then the rent will comfortably pay the mortgage and as you’re truly buying at the bottom of the market, you have an asset that will certainly appreciate in years to come.

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