Property deals flowing in Spain and UK

As the property markets of the UK and Spain bungee jump in unison, new efforts are being made to revitalise the market, something that is essential to both countries…

The new average price for a UK home has plunged to a new low, but seemingly not low enough to spark interest from first-time or second rung buyers nor stop leading housebuilders report profits slumps, lay-offs and site shutdowns.

It’s the same in Spain, where the property sector is three times the size of Britain’s, with a growing list of developer failures, even among well established builders who avoided the flotations and over borrowings. 

If buyer confidence is low, then it’s time to bring out the big marketing guns. When Barratt last found itself in the same position, in the early Nineties, the firm brought out its helicopter “gunship” to buzz its slow-moving developments for television adverts offering a bagful of sales incentives, including shared equity.

History repeats itself, as today Barratt announced an array of incentives including subsidised stamp duty on all homes up to £500,000 and mortgage payments of to £1,000 a month. T

here’s also a promise to pay 15% of any loss resulting from the sale of the property within the first three years. Assuming more mortgages from the running scared banks become available, Barratt might be able to claw back some of the £300M lost profits they also reported.

Costa Blanca is the current hotspot for deals, with builders offering bigger discounts, better specs including all white goods, all furniture, free hotels and meals and 80 percent mortgages. Stamp duty is so low in Spain, it’s not worth subsidising and mortgage interest is lower than the UK.

It was also revealed today that the UK’s homes have been shrinking in size to the point where, on average, they are the smallest in Europe, at a rabbit-hutch dimension of just 76 square metres (818 sq feet). Spain at 20 square metres bigger produces the second biggest homes of all the Med countries – behind Greece.

More property, for less money with lower mortgage and cost of living, suggests Spain might still have the edge for savvy buyers seeking sunshine bargains, blissful beaches and relaxed lifestyle away from rabbit hutch hopping in Britain?