Average prices depreciate in Spain

May 3, 2012 – 2:05 pm

Prices of property fall in Tenerife and Spain

The average price of a home in Spain depreciated by 41.7% between 2006 and 2011, as a consequence of the housing crash, which has been fuelled primarily by a significant housing glut, according to research by Barcelona based Universitat Pompeu Fabra (UPF).

The study, which analysed the sales figures of real estate firm Tecnocasa provided from the end of 2006 to the end of 2011, suggests that Spanish property prices are likely to fall further unless credit conditions improve.

A lack of mortgage liquidity is partly to blame for the collapse in demand for properties in Spain, which has contributed significantly to the huge gap between supply and demand in the country.

The research, led by García Montalvo, reveals that the greatest fall in Spanish property prices occurred between the second half of 2010 and the same period in 2011, when prices fell by 19.7%.

Furthermore, the study shows that while prices have plummeted at the lower end of the property market, price falls have not been so great in some of the most exclusive areas in Spain.

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

More misery for the Spanish property market?

May 2, 2012 – 12:54 pm

More property investment misery in Tenerife and Spain?

The Spanish property market faces more misery with average residential prices expected to fall by a further 18% before finally bottoming out, according to Barclays Capital. The British investment bank says that the decline in values will add to the 22% price drop witnessed since the Spanish property market crashed in 2008. The bank’s latest report claims that Spanish home prices will drop by up to 35% before reaching the bottom of the downturn. But the reality is that property price falls nationwide have been far steeper and have already depreciated by 40%, on average. In fact, this rate of fall has been confirmed by Spain’s Minister for the Economy, suggesting that Barclays Capital’s data is largely unreliable. “So Barclays Capital are right to say that prices might fall 40% in total, but wrong to say that means another 18% of declines to come,” says Spanish property commentator Mark Stucklin. “We are already almost there [at the bottom], certainly when it comes to holiday homes on the coast.”

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Latest Euribor news

May 1, 2012 – 10:12 am

Euribor rate falls in Tenerife and Spain

Euribor (12 months), the interest rate normally used to calculate mortgage repayments in Spain, fell to 1.37pc in April, 34pc lower than the same time last year. As a result, repayments on a typical 25-year, €150,000-mortgage resetting now will go down by around €50/month or €600/year.

But cheaper borrowing costs only apply to those who already have mortgages. New lending collapsed 47pc in February, the 22nd consecutive month of falls, according to the NIE. Increasingly, the only buyers in the market are cash buyers.

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Brits getting ready to buy in Tenerife?

April 30, 2012 – 8:38 am

Brits sending money to Tenerife and Spain in order to buy property

Brits are getting ready to buy by transferring money abroad, according to Knight Frank. An increasing number of UK investors are sending money overseas to purchase a second home, the agency’s head of residential development James Price told OPP this week.

“The recession here in the UK is not really a factor,” he commented.
“People want to move at the higher end for tax reasons… this is a result more of the pull of both climate and culture, rather than any perceived ‘push’ from the UK.”

Price’s comments follows figures this week that show Brits are increasingly
looking abroad for holidays as the weather worsens in the UK. With prices
of property across Europe held down by the recession and the weakening
single currency, some may find themselves staying abroad for longer as they
seek out a place in the sun.

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

Sales of Spanish homes fell in February

April 25, 2012 – 8:58 am

Property sales on the slide in Tenerife and Spain

Sales of Spanish homes fell in February, the National Statistics Institute has announced.

The number of homes sold dropped by 31.8 per cent compared to the year before, with 30,745 properties sold across the month. Out of those, 53.5 per cent were for new homes. The figures mark 12 months of annual decreases in a row, following a drop of 26.3 per cent in January.

Indeed, agency Cinco Dias told Kyero that their sales of new homes fell by 26.5 per cent year-on-year in February with second home transactions decreasing by 37.1 per cent. This followed a monthly surge of sales in January of 42.3 per cent compared to December 2011.

While the national outlook looks grim, some areas remained popular with buyers, with the Balearic Islands and La Rioja seeing the highest number of transactions per 100k people

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

Rising airport charges could cost Spain and Tenerife’s tourism

April 24, 2012 – 9:33 am

Rising airport charges could damage tourism in Tenerife, the Canary Islands and Spain

Rising airport charges could cost Spain 2.87 million tourists, industry figures have warned. The Alliance for Tourism Excellence, Exceltur, labelled the increase in charges as “disproportionate” following their announcement in the State Budget for 2012. The fees, announced this month, could cost the country 2.87 million visitors, the association warned. The reduction in visitor numbers could amount to €1.64 million each year. The new rates, which are expected to be incorporated into ticket prices, have sparked fears that airlines will turn to other beach holiday destinations as a cheaper alternative to Spain, a move that could have serious implications for Spain, a country which relies upon tourism as a major form of income in a post recession climate. Airports expected to be most affected include Barcelona El Prat, which could lose 1.16 million tourists, Madrid Barajas, with 945,115 fewer visitors, and Palma de Mallorca, which could see tourist numbers reduce by 268,567.

Source: Kyero.com

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Spain back in “crisis mode”, but affordable property good news for investors

April 23, 2012 – 9:31 am

Spain in crisis,but property in Tenerife is good value for investors

Spain is back in “full crisis mode”, according to one bank, as property prices continue to plummet. “It is looking more and more likely that Spain is going to have some form of bailout,” Rabobank told OPP. “Assuming there is not an (ECB) intervention, you would not see a cap on Spanish yields, they would just keep increasing.” After the country’s 10-year boom came to a messy end in 2007, Spain’s economy has been dropping like a stone, taking the property market with it. Mortgages payments are rising as rates of inflation rise to 3.4 per cent and banks are left in a vulnerable position, holding one-fifth of the country’s 1 million vacant homes. The new Spanish government are introducing austerity measures to recoup lost finance, including cuts to education and health, but with almost five million unemployed and the economy still shrinking, the return of recession is “likely to suppress local demand”, according to Reuters columnist Maharg-Bravo. But more affordable property remains good news for overseas investors, as real estate values continue to decline at 22 per cent to 29 per cent each year. 

 Tenerife, with it’s beaches and sunshine is still attracting investment from overseas.

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

More wealthy Brits expected to move overseas

April 20, 2012 – 10:03 am

Wealthy Brits moving to Spain and Tenerife?

The volume of wealthy Britons who move overseas is expected to rise in the next two years, according to a new Lloyds TSB International Wealth survey. The study shows that 19% of people with savings and investments worth more than £250,000 are considering moving abroad, up from 17% six months ago and 14% a year ago. The new figure suggests that over half a million people with that level of personal wealth may flee overseas by 2014 in search of a better, more affordable lifestyle. Many of those seeking to leave the UK say that they would reconsider if Briton lowered taxes, cut regulatory red tape for businesses and improved public services such as healthcare, education and the police. Any hike in in the number of Brits moving overseas would undoubtedly fuel greater demand for homes abroad, with Spain, France, Portugal, Australia, and the USA often high on the agenda. Nicholas Boys Smith, director at Lloyds TSB International Wealth, said the number of people expected to leave the UK includes a “large number of successful, affluent individuals who play an important role in powering the UK economy”. He said: “While the figures strongly suggest we won’t see a mass exodus, it is clear that a significant and growing minority see opportunity and a better quality of life overseas.”

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Rich property buyers look to Spain for second homes

April 19, 2012 – 12:11 pm

Rich buyers search Spain and Tenerife for property and a second home

Spain is the fourth most popular country for rich property buyers looking for second homes, according Knight Frank’s latest annual Wealth Report.

The 2012 report, which saw London, New York, Beijing and Paris continue to dominate the list of top cities for real estate investment, also found Spain to be a popular choice when it comes to holiday homes.

The 68-page document found Spain to be the fourth most attractive destination for second home purchases by the world’s wealthiest investors, beaten by France, the UK and the US. For rich Latin Americans, Spain is even more popular, ranking just behind the USA in second place.

Out of the factors considered by buyers for their second homes, lifestyle was the most important, with 67 per cent of all respondents citing it as a major influence. Investment potential, on the other hand, only influenced 55 per cent.

For Latin American buyers, the emphasis on lifestyle was even more prominent, with 86 per cent ranking it as the most important factor in their house hunting

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Average price of a home fell by 11.5% in March compared to last year

April 18, 2012 – 9:43 am

 

Property prices continue to slide in Tenerife and Spain

Vendors have been forced to slash property prices across the country in order to have any chance of realistically attracting a serious buyer, but with the well documented Spanish property crash showing no sign of abating, prices look set to fall further.

Despite claims from some estate agents and developers in Spain that market conditions are improving, it would seem that they are actually getting worse.

The average price of home in Spain fell by 11.5% in March compared to the corresponding month last year, according to Spain’s most widely-watched annualised House Price Index compiled by Tinsa, a leading property valuation firm. The annualised decline in Spanish property is the highest since the housing crash got underway over four years ago.

Spanish home prices have, on average, now dropped by 28.6% since the crisis started in December 2007 and by 35% along the coast, where the greatest glut of homes are located.

Advisory firm R.R. de Acuna & Asociados recently projected that the average price of a home in Spain will fall by 12%-14% this year – the most since the National Statistics Institute started tracking values in 2007.

Fernando Rodriguez de Acuna Martinez, a partner at the advisory company, said: “There will be more serious price drops this year because of the government decree.” What  could happen to prices beyond 2012? With unemployment standing at 23%, which is higher than Greece, and given that Spain is deep in a recession, with greater austerity measures to come, it would appear that prices still have a long way to fall.

Bankinter estimates that housing prices will fall an additional 6% to the end of 2013, but the reality is that the decline is likely to be greater and for longer.

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