As the UK housing market continues to head south, it seems there are still a lot of people looking even further south…to Spain, where that country’s property sector is still showing signs of growth, albeit much less than for a decade.
One market expert, Mark Stucklin of Spanish Property Insight doesn’t see much "speculative herd buying" but instead people who genuinely want to own a home in the country busy "doing their research".
There are also reports of Brit first-time buyers snapping up some of the bargains on offer in Spain because the UK market is still full of over-priced homes, sky-high mortgage deals and a minimum of a year’s wages needed for a deposit as lenders apply further squeezes to the market.
While sterling has declined by 15% against the Euro in the last year, the discounted prices in some areas of Spain “cover” the currency “loss” and still give a further 15% discount below the valuation that will get a half decent mortgage.
The medium term forecast for the UK seems to indicate house prices going up by 25% in the next five years, so it’s not going to be easier for first time buyers to get on the bandwagon. In the same period Spanish home price are expected not to grow until end of 2010 by which time the discounted key ready surpluses should have been taken up and the unsold stock of gone bust developers shared among survivors in trade acquisitions.
Spain has a lot of lifestyle or retirement appeal, and as its tourism is still growing year on year there is likely to be an ongoing demand for renting private villas and apartments. But buyers should beware the traps of the glory years. Buy a bargain resale in an established Des Res area, from a reputable source such as a Spanish bank or well established local estate agency.
If you want a new place, try a key ready reduced price offer from a developer, but first check the latest buying situation on www.eyeonspain.com where actual buyers report on their experiences with Spanish developers.
Before you make a move do lots and lots of research on the internet…always good advice, but now even more so given the current parlous state of the UK, American and Spanish property markets.
28 July 2008
22 July 2008
Property tax tug of war between nations
Maybe the Irish knew something about the EU the rest of Europe didn’t, when they gave it a great big “No” in their latest referendum.
They knew their country had spent billions of EU-provided Euros to fuel the so-called Celtic boom and that many Irish families and investors sent some of their new-found wealth back into “Europe” in the form of investments in property, mainly in Spain as you might expect.
Now, post referendum, they have discovered their funds didn’t go into Europe after all, as their own tax authorities are saying it went “offshore” and demanding tax on any profits made there.
“Offshore” suggests fat cats squirrelling away untold millions into exotic Caribbean islands, rather than making a few hundred quid from renting out a property to ease the mortgage payments bloated by EU monetary policy.
Most buyers are probably not aware of their tax obligations in the country where they bought their apartments or villas. But the Irish tax offices has sent letters to those suspected of owning assets abroad, which tells them that under EU legislation, they have been identified as being in receipt of income from an offshore bank account or accounts, informing them that while this is not illegal, the holders must pay tax on any interest earned on the account.
The noose is also tightening for these non tax compliant owners of “offshore” property because advances in computer software have made it a lot easier for tax officials across Europe to share information.
In Spain, for example, new software was implemented some months ago, which alerts the tax office when there has been a change in the notary deeds of a property following a sale.
“Offshore” bank accounts were probably opened in connection with the purchase and running costs of a property abroad, so the Irish Revenue demands the date the property was purchased; whether it is being rented; the total costs involved; and the source of finance for the purchase.
Gotcha! Their Spanish amigos can click-send their data to confirm or reveal information. Gotcha and Pillado!
Meanwhile, the Hacienda, Spanish tax office, has moved to safeguard it’s tax “losses” to Eire and other European countries whose citizens have fuelled the Spanish property boom and the nation’s economy. Ungratefully, they are enforcing letting licences and fining home owners that don’t have them. Pillado!
Strange that these tax wars between nations have only kicked-off as the property boom across Europe ends. More buyers will be tax compliant for the small profits they may make during the property downturn, but when the boom cycle comes round again, the next generation of buyers will be into Latin America.
Then there will be no property tax bonanza for Europe as banana republics have little time for such niceties. Those places really are “offshore”. Gotcha cha, cha, cha…
They knew their country had spent billions of EU-provided Euros to fuel the so-called Celtic boom and that many Irish families and investors sent some of their new-found wealth back into “Europe” in the form of investments in property, mainly in Spain as you might expect.
Now, post referendum, they have discovered their funds didn’t go into Europe after all, as their own tax authorities are saying it went “offshore” and demanding tax on any profits made there.
“Offshore” suggests fat cats squirrelling away untold millions into exotic Caribbean islands, rather than making a few hundred quid from renting out a property to ease the mortgage payments bloated by EU monetary policy.
Most buyers are probably not aware of their tax obligations in the country where they bought their apartments or villas. But the Irish tax offices has sent letters to those suspected of owning assets abroad, which tells them that under EU legislation, they have been identified as being in receipt of income from an offshore bank account or accounts, informing them that while this is not illegal, the holders must pay tax on any interest earned on the account.
The noose is also tightening for these non tax compliant owners of “offshore” property because advances in computer software have made it a lot easier for tax officials across Europe to share information.
In Spain, for example, new software was implemented some months ago, which alerts the tax office when there has been a change in the notary deeds of a property following a sale.
“Offshore” bank accounts were probably opened in connection with the purchase and running costs of a property abroad, so the Irish Revenue demands the date the property was purchased; whether it is being rented; the total costs involved; and the source of finance for the purchase.
Gotcha! Their Spanish amigos can click-send their data to confirm or reveal information. Gotcha and Pillado!
Meanwhile, the Hacienda, Spanish tax office, has moved to safeguard it’s tax “losses” to Eire and other European countries whose citizens have fuelled the Spanish property boom and the nation’s economy. Ungratefully, they are enforcing letting licences and fining home owners that don’t have them. Pillado!
Strange that these tax wars between nations have only kicked-off as the property boom across Europe ends. More buyers will be tax compliant for the small profits they may make during the property downturn, but when the boom cycle comes round again, the next generation of buyers will be into Latin America.
Then there will be no property tax bonanza for Europe as banana republics have little time for such niceties. Those places really are “offshore”. Gotcha cha, cha, cha…
19 July 2008
Back to the futures for Spain?
When times were good, thousands of Brits were snapping up property in Spain on the promise of price hikes during construction that could be turned into a profit. A easy deposit, and typically, 20 months in the future, the place could be “traded” - resold to the less agile, more sceptical…
Nothing wrong with that, there are vast buildings in capital cities around the world where trading in different sorts of “futures” like the prices of oil, grain and copper are legitimate, but now causing problems as they have been “traded” to the highest levels the world has ever known.
Meantime, back in Spain the apartments and villas along 1,000 miles of Costas, which two years ago were traded to their highest price levels ever, have seen prices come crashing down. The companies that took millions of pounds from susceptible “investors” for courses on how to become a property millionaire have themselves crashed, amid shoals of recriminations from their one-time clients who are left with depleted bank accounts and mortgage payments on untenanted flats.
At one time there were 80,000 property sector companies in Spain turning out 800,000 homes a year – according to urban legend, more than the UK, France and Germany combined – now there are about half the firms and 200,000 unsold saleable homes left.
The big daddy developer of them all, Fadesa – the name on the shirts of one-time Champions League team, Deportivo La Coruna – went bust this week despite recent merging with a rival. Another big developer, Llanera, crashed after sponsoring Charlton Athletic FC, whose supporters never managed to pronounce the name, let alone buy their poorly designed, homes.
Everybody is blaming high interest rates and inflation for the property crash around the world and the record prices for petrol, food and building supplies that have been caused by commodity speculators are adding to the misery.
Hard-up Brits struggling to pay McBrown’s tax bills, fill up the family fridge and car are hardly obvious buyers to snap up bargains in Spain…but wait a minute?
Spanish prices are now 20-30% below even those that were so tempting not so long ago, the new homes are guaranteed 10 years and stuffed with goodies and incentives, resales from mortgage lenders and private owners are half the valuation price, first time buyers are looking at £65,000 deals, over 50s with retirement in mind can do it for 30% less in Spain.
Sunny prospects for 300 days a years, desirable lifestyle, cost of living 30% less than UK, petrol and diesel half the UK levels and a bargain home that can only increase in value…
That might be the next big commodity trade for thousands wanting out of over-taxed, over-looked and over the hill Britain and/or the chance of some fun in the sun?
Nothing wrong with that, there are vast buildings in capital cities around the world where trading in different sorts of “futures” like the prices of oil, grain and copper are legitimate, but now causing problems as they have been “traded” to the highest levels the world has ever known.
Meantime, back in Spain the apartments and villas along 1,000 miles of Costas, which two years ago were traded to their highest price levels ever, have seen prices come crashing down. The companies that took millions of pounds from susceptible “investors” for courses on how to become a property millionaire have themselves crashed, amid shoals of recriminations from their one-time clients who are left with depleted bank accounts and mortgage payments on untenanted flats.
At one time there were 80,000 property sector companies in Spain turning out 800,000 homes a year – according to urban legend, more than the UK, France and Germany combined – now there are about half the firms and 200,000 unsold saleable homes left.
The big daddy developer of them all, Fadesa – the name on the shirts of one-time Champions League team, Deportivo La Coruna – went bust this week despite recent merging with a rival. Another big developer, Llanera, crashed after sponsoring Charlton Athletic FC, whose supporters never managed to pronounce the name, let alone buy their poorly designed, homes.
Everybody is blaming high interest rates and inflation for the property crash around the world and the record prices for petrol, food and building supplies that have been caused by commodity speculators are adding to the misery.
Hard-up Brits struggling to pay McBrown’s tax bills, fill up the family fridge and car are hardly obvious buyers to snap up bargains in Spain…but wait a minute?
Spanish prices are now 20-30% below even those that were so tempting not so long ago, the new homes are guaranteed 10 years and stuffed with goodies and incentives, resales from mortgage lenders and private owners are half the valuation price, first time buyers are looking at £65,000 deals, over 50s with retirement in mind can do it for 30% less in Spain.
Sunny prospects for 300 days a years, desirable lifestyle, cost of living 30% less than UK, petrol and diesel half the UK levels and a bargain home that can only increase in value…
That might be the next big commodity trade for thousands wanting out of over-taxed, over-looked and over the hill Britain and/or the chance of some fun in the sun?
13 July 2008
Housing statistics tell the tale... or do they?
As the UK housing market begins to implode month on month and frenetic media coverage greets every survey from Government and the private sector sources, spare a thought for the property market in Spain, Europe’s biggest and best known.
Some say builders there have been producing around 800,000 new homes a year, but whatever the figure, new Government statistics show there are now officially 24.5 million properties in Spain and 68.5% of them are used as primary homes.
Despite the planning scandals, rising interest rates and the so-called credit crunch Spanish builders increased the housing stock by 2.7% from 2006. More than 423,000 new households were created last year of which 80% are owner-occupied and 20% rented out. That dwarfs the UK market.
Planning permissions are down by 56%, housing starts down 26%, housing completions up 23% and if the trend continues the 700,000 completions per year will drop by 50%. Even that dwarfs the UK market.
That means the prospect of 350,000 new households this year, of which 70,000 are likely to be second or holiday homes along the Spanish Costas.
Market forces suggest they will be will be well-built with 10 year insurance guarantee, fully legal, well equipped and available at a bargain price for a key in hand purchase.
Russian buyers are circling the best buy areas, Brits are holding back hoping for even better deals, other Europeans are in there already enjoying the laid-back Spanish lifestyle, perhaps realising that demand and supply are equalising and 2009 might see the prices pendulum swing, as is being forecast by leading Spanish property portal, http://www.kyero.com who are scornful of rival statistics.
A case of “Look before you leap”…or “He who hesitates is lost”…
More Spanish stats http://spaineconomy.blogspot.com/
Some say builders there have been producing around 800,000 new homes a year, but whatever the figure, new Government statistics show there are now officially 24.5 million properties in Spain and 68.5% of them are used as primary homes.
Despite the planning scandals, rising interest rates and the so-called credit crunch Spanish builders increased the housing stock by 2.7% from 2006. More than 423,000 new households were created last year of which 80% are owner-occupied and 20% rented out. That dwarfs the UK market.
Planning permissions are down by 56%, housing starts down 26%, housing completions up 23% and if the trend continues the 700,000 completions per year will drop by 50%. Even that dwarfs the UK market.
That means the prospect of 350,000 new households this year, of which 70,000 are likely to be second or holiday homes along the Spanish Costas.
Market forces suggest they will be will be well-built with 10 year insurance guarantee, fully legal, well equipped and available at a bargain price for a key in hand purchase.
Russian buyers are circling the best buy areas, Brits are holding back hoping for even better deals, other Europeans are in there already enjoying the laid-back Spanish lifestyle, perhaps realising that demand and supply are equalising and 2009 might see the prices pendulum swing, as is being forecast by leading Spanish property portal, http://www.kyero.com who are scornful of rival statistics.
A case of “Look before you leap”…or “He who hesitates is lost”…
More Spanish stats http://spaineconomy.blogspot.com/
7 July 2008
Days of Plenty in Spanish property
Days of Plenty for Spanish holiday homes developers selling off plan to eager buyers have been replaced by Days of Plenty of unsold Costa homes.
The overseas property market situation is said to be deteriorating due to falling buyer confidence, rising interest rates, growing mortgage delinquencies, the so-called credit crunch, and a rising Euro that is pricing British buyers out of the market.
Pundits say there are 300,000 unsold homes in Spanish coastal areas alone and research shows 75% of them are carrying a discount of one sort or another of which 30,000 can be snapped up at 20-30% below market value.
Which surely makes it the ideal time for UK buyers to grab the bargain of a decade? Research on the internet will show the best areas with the best facilities and at the best prices. Make sure there’s a show house to inspect when you get there. A round of drinks in the nearest Brit bar should reveal any local issues. Avoid free viewing trips, introductions to linked lawyers and side trips to a “last minute bargain” organised with an untested local estate agent.
Organise your mortgage before you go, set a firm budget and buying brief and stick with it. The best mortgages from 50 Spanish banks can be sourced through London-based Finance2Go and http://www.propertyinspain.net/ provide useful property checklists free in their comprehensive view trip packs and have plenty of big discount deals.
They say the best bargains are to be found in Costa Blanca, turning right from Alicante Airport. Enjoy 3-5 years of great holidays in your new place and then watch the values start to rise again. Over 50s can use their bargain purchase ahead of fulltime retirement.
Days of Plenty for buyers with a nose for a bargain…
The overseas property market situation is said to be deteriorating due to falling buyer confidence, rising interest rates, growing mortgage delinquencies, the so-called credit crunch, and a rising Euro that is pricing British buyers out of the market.
Pundits say there are 300,000 unsold homes in Spanish coastal areas alone and research shows 75% of them are carrying a discount of one sort or another of which 30,000 can be snapped up at 20-30% below market value.
Which surely makes it the ideal time for UK buyers to grab the bargain of a decade? Research on the internet will show the best areas with the best facilities and at the best prices. Make sure there’s a show house to inspect when you get there. A round of drinks in the nearest Brit bar should reveal any local issues. Avoid free viewing trips, introductions to linked lawyers and side trips to a “last minute bargain” organised with an untested local estate agent.
Organise your mortgage before you go, set a firm budget and buying brief and stick with it. The best mortgages from 50 Spanish banks can be sourced through London-based Finance2Go and http://www.propertyinspain.net/ provide useful property checklists free in their comprehensive view trip packs and have plenty of big discount deals.
They say the best bargains are to be found in Costa Blanca, turning right from Alicante Airport. Enjoy 3-5 years of great holidays in your new place and then watch the values start to rise again. Over 50s can use their bargain purchase ahead of fulltime retirement.
Days of Plenty for buyers with a nose for a bargain…
Happy Spa Valley for the Over 50s
It was enough for the British silver brigade to choke on their over-priced free range eggs, habitually served with the Sunday newspapers... There was the news – it was costing pensioners 30% more to live than 10 years ago.
The official data, however, was not related to reality as pensioners and their families know it’s a lot worse than that in high-cost, going broke Britain, where just days before, Ministers and MPs voted to keep their unaccountable expenses pending the arrival of their index-linked pensions.
So for many pensioners and the over 50s of the land, it’s crunch time on where to weather out future inflationary years…
Another two years of McBrown bungles, followed by four or five of Tory trickery when they find the fiscal cupboards are empty could mean even more hardship for the silver brigade.
Conversely, Spain is doing better economically and has billions of euros worth of wriggle room to help out its citizens, coupled with a warm climate, a cost of living 30% below the UK and lower taxes and mortgages.
And, guess what, Spanish builders have already spotted the opportunity to tempt thousands of Over 50s with so-called “Active Life Communities” promising a heady mix of sports and medical facilities.
At La Encina Active Life Resort in a spa valley, Murcia, villas are on offer for around £150.000 and apartments for a lot less. A spa and medical centre is surrounded by homes, sports and cycle/buggy trails to keep the old heart beating strongly and when it needs a booster. helipad for a flight to the nearest A&E hospital.
Specialists, http://www.propertyinspain.net/ have brochures, videos and free trips for over 50s interested in quitting the uncertainties of Britain for a happy spa valley - but don’t all rush at once, this is mañana territory, remember..
The official data, however, was not related to reality as pensioners and their families know it’s a lot worse than that in high-cost, going broke Britain, where just days before, Ministers and MPs voted to keep their unaccountable expenses pending the arrival of their index-linked pensions.
So for many pensioners and the over 50s of the land, it’s crunch time on where to weather out future inflationary years…
Another two years of McBrown bungles, followed by four or five of Tory trickery when they find the fiscal cupboards are empty could mean even more hardship for the silver brigade.
Conversely, Spain is doing better economically and has billions of euros worth of wriggle room to help out its citizens, coupled with a warm climate, a cost of living 30% below the UK and lower taxes and mortgages.
And, guess what, Spanish builders have already spotted the opportunity to tempt thousands of Over 50s with so-called “Active Life Communities” promising a heady mix of sports and medical facilities.
At La Encina Active Life Resort in a spa valley, Murcia, villas are on offer for around £150.000 and apartments for a lot less. A spa and medical centre is surrounded by homes, sports and cycle/buggy trails to keep the old heart beating strongly and when it needs a booster. helipad for a flight to the nearest A&E hospital.
Specialists, http://www.propertyinspain.net/ have brochures, videos and free trips for over 50s interested in quitting the uncertainties of Britain for a happy spa valley - but don’t all rush at once, this is mañana territory, remember..
5 July 2008
Ups and Downs for Spain and Property
The ups and downs of Spain’s property driven economy were highlighted when Prime Minister Zapatero demanded that the European Central Bank help out by lowering the Eurobor interest rate but the ECB President told him to mind his own business and promptly raised it for the first time in a year…
The ECB wants European workers to bear the brunt of the growing economic crisis of rising energy and food prices, while the Spanish Government wants to protect the country’s construction industry that has been busy boosting the economy for the last decade and is now shedding high prices and jobs.
As 98% of mortgages in the country are linked to the Eurobor rate, Spanish households are in for some belt tightening – just like their counterparts in the UK and the US. Brit buyers seeking that dream home in the sun are going to be paying more if they need a hefty mortgage, but mortgage broker, Alberto Linares points out this is still a lot less than the rate they are paying on the UK homes.
With a wide choice of key ready homes to choose from, British buyers will still find it easier to buy in Spain than in the UK and specialist websites like http://www.propertyinspain.net/ are offering 30% discounts on completed homes and 50% on bank repossessions – and have official valuations to wave in front of eager buyers.
A case of seller’s downbeat despair becoming buyers upbeat delight…
The ECB wants European workers to bear the brunt of the growing economic crisis of rising energy and food prices, while the Spanish Government wants to protect the country’s construction industry that has been busy boosting the economy for the last decade and is now shedding high prices and jobs.
As 98% of mortgages in the country are linked to the Eurobor rate, Spanish households are in for some belt tightening – just like their counterparts in the UK and the US. Brit buyers seeking that dream home in the sun are going to be paying more if they need a hefty mortgage, but mortgage broker, Alberto Linares points out this is still a lot less than the rate they are paying on the UK homes.
With a wide choice of key ready homes to choose from, British buyers will still find it easier to buy in Spain than in the UK and specialist websites like http://www.propertyinspain.net/ are offering 30% discounts on completed homes and 50% on bank repossessions – and have official valuations to wave in front of eager buyers.
A case of seller’s downbeat despair becoming buyers upbeat delight…
Ups and Downs for Spain and Property
The ups and downs of Spain’s property driven economy were highlighted when Prime Minister Zapatero demanded that the European Central Bank help out by lowering the Eurobor interest rate and the ECB President told him to mind his business and promptly raised it for the first time in a year…
The ECB wants European workers to bear the brunt of the growing economic crisis of rising energy and food prices, while the Spanish Government wants to protect the country’s construction industry that has been busy boosting the economy for the last decade and is now shedding high prices and jobs.
As 98% of mortgages in the country are linked to the Eurobor rate Spanish households are in for some belt tightening – just like their counterparts in the UK and the US.Brit buyers seeking that dream home in the sun are going to be paying more if they need a hefty mortgage, but mortgage broker, Alberto Linares points out this is still a lot less than the rate they are paying on the UK homes.
With a wide choice of key ready homes to choose from, British buyers will still find it easier to buy in Spain than in the UK and specialist websites like http://www.propertyinspain.net/ are offering 30% discounts on completed homes and 50% on bank repossessions – and have official valuations to wave around.
A case of seller’s downbeat despair becoming buyers upbeat delight…
The ECB wants European workers to bear the brunt of the growing economic crisis of rising energy and food prices, while the Spanish Government wants to protect the country’s construction industry that has been busy boosting the economy for the last decade and is now shedding high prices and jobs.
As 98% of mortgages in the country are linked to the Eurobor rate Spanish households are in for some belt tightening – just like their counterparts in the UK and the US.Brit buyers seeking that dream home in the sun are going to be paying more if they need a hefty mortgage, but mortgage broker, Alberto Linares points out this is still a lot less than the rate they are paying on the UK homes.
With a wide choice of key ready homes to choose from, British buyers will still find it easier to buy in Spain than in the UK and specialist websites like http://www.propertyinspain.net/ are offering 30% discounts on completed homes and 50% on bank repossessions – and have official valuations to wave around.
A case of seller’s downbeat despair becoming buyers upbeat delight…
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