Bad news for all holiday home owners

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This topic contains 50 replies, has 19 voices, and was last updated by Profile photo of Anonymous Anonymous 6 years, 10 months ago.

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  • #55339
    Profile photo of Anonymous
    Anonymous
    Participant

    Because they could not provide the tax break all across Europe, they decided to also cut it for British owners…

    Well, so much for some hope…

    http://www.telegraph.co.uk/finance/personalfinance/how-budget-affect-me/6781200/Pre-Budget-report-owners-of-holiday-homes-hit.html

  • #95557
    Profile photo of Anonymous
    Anonymous
    Participant

    Well, I guess that’s good news for Spain (not really, but you’ve got to try and look on the bright side).

    It removes an advantage of buying a holiday home in the UK, so you might as well buy in Spain. At least we still have the sun. Last time I checked there wasn’t much of that in the UK.

    Watching the Closing Bell on CNBC last night the commentators all agreed the UK is now an economic basket case. “It’s very say” one of them said.

  • #95560
    Profile photo of Anonymous
    Anonymous
    Participant

    mark

    yes, let’s all rush off and buy a place in Spain. We can sit in the sun with a cold lager and watch the value of our property dropping in front of our eye’s!!

    I think the basics in the UK are ok to climb slowly out of recssion, though some will be hit much harder than others. We could certainly do with a bit of the sunshine though!!

  • #95562
    Profile photo of Anonymous
    Anonymous
    Participant

    the uk has been a cash cow that has become old and dried up with so much of the money earnt in the uk being sent back to other countries to families left behind by migrant workers.the amount of money paid out to the retired that are now ex-pats,and all the hand outs to those on welfare the money left isn’t enough to oil the cogs anymore yet our stupid govenment is still ploughing our money into other countries at an alarming rate.war,the enviroment and genneral good deed handouts to the needy wonder how much help we will see from other countries when we are all on our knees begging for help

  • #95568
    Profile photo of Anonymous
    Anonymous
    Participant

    dartboy
    spot on
    you could call it corruption the way they spend our money.
    AND WHY DO THEY DO IT.

  • #95570
    Profile photo of Anonymous
    Anonymous
    Participant

    Gordon Brown has just pledged £1.5 billion at the Copenhagen Climate Summit. France and Germany have only pledged £1.2 billion each – who says the Scots are tight…..oh sorry, forgot, it’s OUR money he’s pledging, not his.

    Apparently our generous Scot pledged ‘big’ to encourage bigger offers, particularly from Spain and Italy. Will be interesting to see if Spain and Italy respond to his encouragement. 🙄

    What a farce – our servicemen and women lack adequate equipment and our elderly are in fuel poverty. What part of “we’re broke” and “we should take care of our own” doesn’t this total moron understand.

  • #95571
    Profile photo of Anonymous
    Anonymous
    Participant

    alanthornton:

    Transparency International defines ‘corruption’ as:

    ‘the abuse of entrusted power for private gain’.

    Please explain why you think the UK government decision on spending is ‘corruption’?

  • #95574
    Profile photo of Anonymous
    Anonymous
    Participant
    charlie wrote:
    Gordon Brown has just pledged £1.5 billion at the Copenhagen Climate Summit. France and Germany have only pledged £1.2 billion each – who says the Scots are tight…..oh sorry, forgot, it’s OUR money he’s pledging, not his.

    Apparently our generous Scot pledged ‘big’ to encourage bigger offers, particularly from Spain and Italy. Will be interesting to see if Spain and Italy respond to his encouragement. 🙄

    What a farce – our servicemen and women lack adequate equipment and our elderly are in fuel poverty. What part of “we’re broke” and “we should take care of our own” doesn’t this total moron understand.

    Does Brown ever do anything that will benefit Britain? 1,5 billion just thrown away today , when Britain is bankcrupt. Next it will be aid for Zimbabwe.

  • #95584
    Profile photo of logan
    logan
    Participant

    @mark wrote:

    so you might as well buy in Spain. At least we still have the sun. Last time I checked there wasn’t much of that in the UK.

    Mark. Forgive me but I am starting to believe rightly or wrongly this forum is now designed to encourage people to buy property in Spain.
    I know you need advertising to survive but objectivity and honest market intelligence are more important tools than simply talking up the market like an agent. 🙁

  • #95585
    Profile photo of Anonymous
    Anonymous
    Participant

    it would seem fair if the biggest polluters paid the lions share, and every polluting country should contribute on that scale?

    If GB had pledged half that amount, and countries like Spain and Italy felt they only need contribute small amounts because countries like the UK have, then where will that leave climate control?

    I don’t know the answer, and I agree that huge sums of money would be seem better spent on issues that effect needy people now, or getting the country out of the shite, but if all countries take that line, will history look back on that attitude with horror if we destroy the planet in the next few generations?.

    Will the Tory’s do any better next year?, I very much doubt it. After the honeymoon period I’m sure we will be slagging them off just as much! They will no doubt use the ”we inherited a disaster” attitude for any of their failings for years to come!!

  • #95586
    Profile photo of Anonymous
    Anonymous
    Participant

    logan

    I think (and hope) marks tonque was firmly in cheek when he made that comment!.

  • #95587
    Profile photo of Anonymous
    Anonymous
    Participant

    @logan wrote:

    @mark wrote:
    so you might as well buy in Spain. At least we still have the sun. Last time I checked there wasn’t much of that in the UK.

    Mark. Forgive me but I am starting to believe rightly or wrongly this forum is now designed to encourage people to buy property in Spain.
    I know you need advertising to survive but objectivity and honest market intelligence are more important tools than simply talking up the market like an agent. 🙁

    Logan
    How could anyone think the site was advocating buying in Spain with every thread dominated by tales of woe that we are all becoming tired of.
    Its the season of goodwill to all men.
    Including agents, bankers, developers, builders and solicitors.
    Merry Xmas to all.

  • #95588
    Profile photo of angie
    angie
    Spectator

    Logan and Goodstich.

    A short while ago I asked the question on here ‘do websites earn income through commercialism, ie property sales etc, media stories’, but this was unanswered. In the past Mark wrote as Spanish Property Doctor for the S. Times but this seems to have stopped.

    Whilst Mark’s site used to be the least biased towards property sales and advertising, I have also noticed a more recent slant towards ‘talking the market up’ when clearly it is still falling, so I also hope it was a ‘tongue in cheek’ comment about buying now in Spain.

    Yes there are bargains in Spain if you want to live there permanently, but not for investment, it will take years to realise a profit after all the costs and exchange rate problems.

    Talking the Spanish market up as some UK agents are too, could seriously damage your health and wealth if you buy now, and that would start a whole new issue on here about mis-selling as in the past. 😉

  • #95589
    Profile photo of Anonymous
    Anonymous
    Participant

    @vilprano wrote:

    Its the season of goodwill to all men.
    Including agents, bankers, developers, builders and solicitors.

    That’s fine if it was a two-way street, but it’s not.

    As for tales of woe, though it may irk you there are those of us who are simply trying to keep eyes wide open. You’re free to write your tales of joy – no-one’s stopping you.

  • #95592
    Profile photo of angie
    angie
    Spectator

    Well said charlie, and also for your post re ‘pitfalls on buying in Spain’, not unlike my recent tale of how agents dupe buyers there with their measured sales tactics and scams. 😆

  • #95593
    Profile photo of Anonymous
    Anonymous
    Participant

    Vilprano

    so, the season of goodwill to all men. To all the good guys in the industry then yes, but to the one’s who have caused so much misery then ”rot in hell” this xmas is probably more appropriate!

  • #95594
    Profile photo of Anonymous
    Anonymous
    Participant

    @charlie wrote:

    @vilprano wrote:
    Its the season of goodwill to all men.
    Including agents, bankers, developers, builders and solicitors.

    That’s fine if it was a two-way street, but it’s not.

    As for tales of woe, though it may irk you there are those of us who are simply trying to keep eyes wide open. You’re free to write your tales of joy – no-one’s stopping you.

    Charlie,
    It may be of some surprise to you if you had read my posts as I have been the subject of the corrupt practices of agents builders and solicitors.
    This has cost me over 100K so far and rising with legal costs to recover my losses.
    However I will not let these sharks destroy my life or allow it to interfere with my relationships with family and friends.
    I am dissapointed that I fell foul of these scams following a lifetime of working hard and saving for our future.
    I still have joy in my life I believe that most are basically honest and continue to lead my life in my own way.
    I will purchase a property in Spain as I love the country and its people, but that is my choice.
    Constantly bleating about my misfortune will not change my life or my bank balance.
    All I can say is as before vive la difference.

  • #95595
    Profile photo of logan
    logan
    Participant

    I am not really sure why anyone would wish to read so called ‘positive’ posts when there is clearly nothing positive at all currently about the Spanish property market.
    I read market reports constantly from various sources. Investment is a serious business and positive reports need hard data to back them up to support an argument. Not just some wooly feel good chat, designed to make those mired in problems feel a little less troubled.
    This site used to and still does occasionally carry quite good on the ground intelligence. Such information is useful to those who live outside of Spain but still retain an interest in the Spanish market.
    I get upset when I see gullible people still being persuaded to invest in a falling market where they are plainly going to loose a great deal of money.
    Property professionals in Spain need a set of standards forced upon them so they will act responsibly and honestly.
    So do web sites that present a less than honest picture of the realities.
    Markets are all about confidence. In this recession that market confidence in Spain has been shot to pieces.
    Unless good practice standards are imposed by central government and properly policed in future, market confidence will never return.

  • #95599
    Profile photo of Anonymous
    Anonymous
    Participant

    angie

    A short while ago I asked the question on here ‘do websites earn income through commercialism, ie property sales etc, media stories’, but this was unanswered.

    This type of site is quite cheap to run and maintain depending on your understanding of things IT and Internet. The software this site uses is free http://www.phpbb.com/

    Hosting about £50 p.a. the rest is down to how much help you need to keep it running, it would appear that this site used a spanish firm called http://www.creacions.com/

    As for income well that’s Google AdSense and while it would always be difficult to estimate the value of the the site without a lot of information, the basic principle is that the site would earn a small (less than £1.00) each time an ad is clicked on the page.

    Google will not allow you to earn money if just one person sat at his/her computer all day and just clicked at the ads, as they log the (IP) address of any computer clicking an ad.

    I would guess looking at the same old names on here (no offence intended) Mark is not earning a bean from the site.

    Regards

    Paul

    Merry Christmas by the way from a happy owner

  • #95602
    Profile photo of Anonymous
    Anonymous
    Participant

    I was being ironic.

    I write about Spanish property, and I try and give a balanced opinion. Even at a time like this there are some good things to report. Some property is selling well if the price is right price, and I’m sure the new owners are delighted with their purchases. Some people may not want to hear it but it is a fact.

    It’s ridiculous to accuse this site of talking up the market. Look at the content of this forum. Look at my blog. But if you have any doubts I urge you not to waste your time here.

    I have to pay to keep this forum going. There’s no money in it.

    Mark

  • #95603
    Profile photo of logan
    logan
    Participant

    @mark wrote:

    Even at a time like this there are some good things to report. Some property is selling well if the price is right price, and I’m sure the new owners are delighted with their purchases. Some people may not want to hear it but it is a fact.
    Mark

    If some property is selling well as a fact, please direct us to where the ‘facts’ can be verified.
    I hesitate to involve myself in any arguments with Mark but you really should not make statements like that without something to back it up.

  • #95606
    Profile photo of Inez
    Inez
    Participant

    From the end of august until now I personally have completed on 7 sales including a hotel, with 2 more underway and my colleague who started in september has completed 5 deals with another 4 to conclude.

    There is definately more interest around, whilst low offers are being made, they are being made and mostly accepted, mainly cash buyers, 50% spanish buyers, other nationalities mainly english and mainly for holiday homes.

    Hope that helps with some facts.

  • #95607
    Profile photo of Anonymous
    Anonymous
    Participant

    I will have to jump to Marks defence. In all the Countries & through all type of economical cycle commerce goes on. Housing is necessity.

    The forum users maybe looking at the situation with their own circumstances in mind i.e. holiday home, retirement and even as an investment. The Brits are a small proportion of the buyers. The domestic market is the real Spanish market.

    Mark, has got an over all view of Spain by being there & being well entergated in the society. How many of us would want to know or have any relevance if Asturias, extramadura or Navarra has a high proportion of sales and what is happening to them.

    Facts & statistics are not a tool one should use in Spain for decision making due to lack of accuracy even allowing for margin of error.

  • #95613
    Profile photo of petej
    petej
    Participant

    @mark wrote:

    I was being ironic.

    I write about Spanish property, and I try and give a balanced opinion. Even at a time like this there are some good things to report. Some property is selling well if the price is right, and I’m sure the new owners are delighted with their purchases. Some people may not want to hear it but it is a fact.

    Couldn’t agree more Mark, when we were buying we missed two properties after putting in low offers thinking “no ones buying anyway” only to see them sold to someone else in a week. Location, property type and correct pricing will of course all have a effect on the saleability of a property.

    Most serious buyers with the help of this site and others like this are aware of the problem of the Spanish property market with its falling prices, illegal builds etc but for there own reasons still chose to buy and yes we are very happy with our purchase

    We were seeing price differences of up to 120,000 Euro for properties that for all measures were the same, the over priced property’s will never sell, they are still there now 2 ½ -3 years after we started looking. One was up for 340,00 Euro and was in the latter stages of being restored, a British couple had run out of money and needed to sell at this price to cover the mortgage, they have not a hope in hell, a sad tail of which there must be many

    I should also point out that we purchased in the early summer this year when sterling went up to nearly 1.19 Euro so maybe that had something to do with the conditions I found

  • #95616
    Profile photo of Anonymous
    Anonymous
    Participant

    petej

    so some places are selling in small numbers then. I think that’s accepted as fact, but with the outstanding mortgage debdts like you mentioned, there’s a feeling Spain’s property industry prices could still come crashing down in a desperate attempt to move the 1,000,000+ unsold or unfinished properties. Perhaps it won’t happen?, but sooner or later I would think a large number people and financial institutions are going to have to cut ever growing huge losses somehow? It could be ‘sale of the century?.

  • #95617
    Profile photo of katy
    katy
    Spectator

    Wow oh Wow, properties are selling things are on the move. Deck the halls etc. Tra-la-la-la-la 😮

    We were all wrong, the newspapers are wrong. Cos we have it from a couple of horses mouth. What do we know! Inez is selling more properties than she sold before the crunch. Canny investors are snapping up Hotels (did no-one tell them a record number have closed this winter).

    Buy now….there will be no properties left come March 😆 😆

    Tr-la-la-la-la-la 🙄

  • #95618
    Profile photo of Anonymous
    Anonymous
    Participant

    @petej wrote:

    Most serious buyers with the help of this site and others like this are aware of the problem of the Spanish property market with its falling prices, illegal builds etc but for there own reasons still chose to buy and yes we are very happy with our purchase

    “Most serious buyers”? Do you mean the buyers with lots of money? Or the ones that buy because they need a primary residence?

    I think that only the ones that buy a house as a primary residence or the ones with lots of money to burn (with no problem if they lose 20% on their money) would buy in a
    falling market.

    The rest of us with limited funds can rent holiday homes for much longer.

  • #95619
    Profile photo of angie
    angie
    Spectator

    Thanks p800aul for explaining the mechanics/costings of running such a site and Mark has explained he has to pay for running forums which is something I’ve learnt, (knowledge is good)!

    I believe some other sites are or were probably making money due to heavy advertising, that’s why we considered this site unbiased.

    There are those who post here who do regularly ‘talk the market up’ in Spain when the market is dire in reality, and it’s this misinformation many of us who’ve had bad experiences of the constant property scams will continue to expose provided we’re allowed to!

    I feel a sense of irk though when we do point out the pitfalls etc 🙄

  • #95620
    Profile photo of Anonymous
    Anonymous
    Participant

    katy

    if you snap up the last million homes I’ll be really angry. Stop buying now and give the rest of us a chance before prices treble in price next March!!

  • #95622
    Profile photo of angie
    angie
    Spectator

    Goodstich and Katy, only 1 million unsold homes? Is that ‘tongue in cheek’ irony? 😛

    We all know the figure was nearer 2 million and that’s just the new unsold homes, what about all the others? 😉

    When the defaults/mortgages start to really hit the Banks, Spain will be doing 3 for 2 offers, and 2 for the price of 1 which will probably still be overpriced 8)

  • #95623
    Profile photo of petej
    petej
    Participant

    @goodstich44 wrote:

    petej

    so some places are selling in small numbers then. I think that’s accepted as fact, but with the outstanding mortgage debdts like you mentioned, there’s a feeling Spain’s property industry prices could still come crashing down in a desperate attempt to move the 1,000,000+ unsold or unfinished properties. Perhaps it won’t happen?, but sooner or later I would think a large number people and financial institutions are going to have to cut ever growing huge losses somehow? It could be ‘sale of the century?.

    I have no crystal ball, we know prices are still going down, but of course it could all come crashing down by a huge amount, I think it is so dependent on type of property and area that its hard to make sweeping statements but no one can argue with the fact in excess of 1 million properties remain unsold or unfinished and the effect that has on the market

  • #95624
    Profile photo of petej
    petej
    Participant

    @flosmichael wrote:

    @petej wrote:
    Most serious buyers with the help of this site and others like this are aware of the problem of the Spanish property market with its falling prices, illegal builds etc but for there own reasons still chose to buy and yes we are very happy with our purchase

    “Most serious buyers”? Do you mean the buyers with lots of money? Or the ones that buy because they need a primary residence?

    All I mean by serous buyers are people looking with the money and will to buy as opposed to people flying over with the idea of getting a four bed villa detached in a reasonable area for 50,000 Euro including taxes as all they here is the Spanish market is in such a state, and if someone says that days not far away then you can put me down for a few as I would regard that as an investment!

  • #95627
    Profile photo of logan
    logan
    Participant

    If I had a Euro for every property professional in Spain that has told me recently that the market was starting to turn I could have a very comfortable couple of days in my favorite Parador!
    The market continues to fall because no one is buying and no one is lending and no one has any confidence that Spain will clean up its corrupt system.
    There will always be a handful of buyers who are uninformed, have the money and don’t care if they lose it. Then there are also a handful of buyers who have the money and want a holiday home at any price, like the latest tech gadget or this months must have fashion. Common sense will always elude them because they could not care less about markets. A few houses selling does not a market make.
    Professional investors and those who are market savvy will never act knowing their investment can not be sold for a profit or a decent return obtained. You might as well invest in down town Kabul.

  • #95628
    Profile photo of katy
    katy
    Spectator

    I am confused is it 2 million illegal houses or 2 million unsold 😯

    I may buy a few now the rush has started or maybe I shall try to sell 😆

    Seriously, my spanish Lawyer neighbour says there is nothing selling on the coast. This was backed up by his Father who is Notary. Still, what do we people know compared to a selective few……..we know nothing, we are wrong

    Can I just add I HATE BA AND THEIR TROLLY DOLLIES. There was I prepared to fly off to paradise (real paradise that is 😆 ) and no flight 😈

  • #95630
    Profile photo of Anonymous
    Anonymous
    Participant

    @katy wrote:

    I am confused is it 2 million illegal houses or 2 million unsold 😯

    I may buy a few now the rush has started or maybe I shall try to sell 😆

    Seriously, my spanish Lawyer neighbour says there is nothing selling on the coast. This was backed up by his Father who is Notary. Still, what do we people know compared to a selective few……..we know nothing, we are wrong

    Can I just add I HATE BA AND THEIR TROLLY DOLLIES. There was I prepared to fly off to paradise (real paradise that is 😆 ) and no flight 😈

    Katy, I am sure that properties still sell in Madrid, Barcelona, Valencia or other places where there still are some decent salaries paid to people who then buy a home.

    On the other hand , I am quite sure that very few buy holiday homes.

  • #95631
    Profile photo of rt21
    rt21
    Participant

    It seeems to me that some on here like to talk the market up and some like to talk it down for their own vested reasons. However, I am not saying that everyone on here as a vested interest. Some clearly tell it as they see it. The trick for new members is to look beyond the postings that some make on here.

  • #95632
    Profile photo of peterhun
    peterhun
    Participant

    Try to remember that is a long, extended crash in asset values cause by world-wide deleveraging. There has been a massive boom in credit, the source of which has disappeared forever and it will take five years or more to return to more sustainable levels of debt.

    In the meanwhile prices and sales will flicker, month to month, year to year but the onward pressure will be down.

  • #95635
    Profile photo of Anonymous
    Anonymous
    Participant

    peterhun

    yes, but the crash was going to happen whatever went on in the rest of the world. As soon as the property boom was ruled by corruption and lack of regulation, it was doomed to fail. I think until changes are made to make it a system that can be trusted to work more for decent people and not mainly crooks, then perhaps the end of recession will only be half the battle?

  • #95642
    Profile photo of Anonymous
    Anonymous
    Participant

    @peterhun wrote:

    Try to remember that is a long, extended crash in asset values cause by world-wide deleveraging. There has been a massive boom in credit, the source of which has disappeared forever and it will take five years or more to return to more sustainable levels of debt.

    In the meanwhile prices and sales will flicker, month to month, year to year but the onward pressure will be down.

    The stock market boom around the millenium and the house price boom
    were once in a lifetime events fueled by easy money.

    Unless we get hyperinflation (more and more likely as the inflation numbers move upwards), asset prices will continue to go down. During a potential hyperinflationary period, buying a house would be an excellent move.

  • #95652
    Profile photo of Anonymous
    Anonymous
    Participant

    The inflation scenario is something I’ve been worrying about for a while. Nobody is really talking about it, but I expect it will be big news in future.

    I don’t expect hyperinflation a la Bob Mugabe, but I do expect double figures in the medium term. Inflation is one way to deal with our massive debts (inflation reduces the real value of debt). Most governments, including UK and Spain, are too spineless to go down the other road, which is spend less and tax more.

    And let’s face it, nobody has a bigger interest in a dose of high inflation that eats away debt than our governments, who are borrowing like there is no tomorrow, literally. “Inflation is always and everywhere a monetary phenomenon,” said Friedman. Well, our central banks are furiously printing money (they dress it up with fancy names like ‘quantitative easing’) and unless you trust the shower that lead us not to screw it up big time, then you should be expecting high inflation down the line. I do. And never forget, inflation is a sort of tax on savings. Politicians just love to get their hands on your savings.

    And what should do you do if you expect high inflation? Get into hard assets like commodities and property (and gold, of course). Cash in the bank will just evaporate.

    That said, I’m not suggesting you should start buying up flats in forlorn developments on the Spanish coast. I think you can do better than that. But I wouldn’t rule out the possibility that, in 5 years time, your cash might be better off even in one of those forlorn developments than in the bank. Crazy world we live in.

  • #95656
    Profile photo of Anonymous
    Anonymous
    Participant

    @mark wrote:

    The inflation scenario is something I’ve been worrying about for a while. Nobody is really talking about it, but I expect it will be big news in future.

    I don’t expect hyperinflation a la Bob Mugabe, but I do expect double figures in the medium term. Inflation is one way to deal with our massive debts (inflation reduces the real value of debt). Most governments, including UK and Spain, are too spineless to go down the other road, which is spend less and tax more.

    That said, I’m not suggesting you should start buying up flats in forlorn developments on the Spanish coast. I think you can do better than that. But I wouldn’t rule out the possibility that, in 5 years time, your cash might be better off even in one of those forlorn developments than in the bank. Crazy world we live in.

    Mark, you are right, in hyperinflation periods the money loses value quite fast.

    But there are some things to consider:

    – one has to be careful with mortgages. During hyperinflation periods, the mortgage rates also go sky-high. A double digit inflation means a double digit
    EURIBOR which means a 12%+ mortage rate.

    – same applies in UK. People would use their savings to firstly pay for their UK mortgages and then go into extya foreign mortgages.

    – if one has cash without much debt, then I agree that spending the cash is the best solution. But one can also have price inflation without salary inflation which would mean that the extra cash will be needed to pay for everyday things like petrol, food
    and heating…

    That said, in the event the hyperinflation becomes obvious, I shall probably buy a holiday apartment right away…

  • #95659
    Profile photo of rt21
    rt21
    Participant

    Although I agree that in the past some countries have allowed inflation to take a grip in order to resolve other economic oroblems, I cannot see that happenning in Spain. Usually inflation occurs when too much money is chasing too few goods and that normally is a consequence of monetary policy. However Spain is wedded to the Euro and the European Bank’s
    monetary policy is based on controlling inflation within very strict parameters.

    Once inflation starts to increase in eurozone then the European Bank will increase interest rates, which will choke off any inflationary pressures

    Richard

  • #95660
    Profile photo of Anonymous
    Anonymous
    Participant

    Hyper inflation !!!!!!!! Can anybody shed some light or direct me as to where I can get information on the economic situation after the crash of the 30’s.

    I would like to know how the economy evolved after the 30’s, what form it took and at what stage did the hyper inflation took hold indeed if it did relatively speaking.

    What, countries were effected, how & what level the assets values were depleted .

  • #95661
    Profile photo of angie
    angie
    Spectator

    katy, a recent figure for unsold homes was 1.623 million which I believe was a figure for new homes, others say it’s higher than this if you take all of Spain into account (2 mill. plus) then there are the resales which I understand are not included in this.

    I think the true figures are obscured because they are so bad, a bit like figures for UK unemployment which are much higher than Gov’t stats.

    Spain is now touted to be the country most likely to be in the worst financial trouble, downgraded from stable, to negative. If so, then is it good to invest in property yet, IMO not for some time despite so called bargains around.

  • #95664
    Profile photo of Anonymous
    Anonymous
    Participant

    Richard, I hope you are right. But with government debts at unprecedented (peacetime) levels, don’t be too sure. They would be the biggest beneficiaries of inflation.

    Shakeel. The stock market crash was in October 1929. After that came an economic depression (mainly in the US) with deflation, not inflation. But back then the government raised taxes, cut spending, and raised tariffs. This time they have been spending and printing money like no tomorrow, so very different.

    I happen to know this because I’ve just finished reading The Great Crash of 1929, by JK Galbraith, which I highly recommend. Makes you realise it has all happened before, so we shouldn’t be surprised. May even happen again in my lifetime.

    There is a brilliant section early in the book on the Florida real estate boom and bust of 1925. It is exactly what happened in Spain earlier this decade. Read it and weep:

    “One thing in the twenties should have been visible even to [President Calvin] Coolidge. It concerned the American people of whose character he had spoken so well. Along with the sterling qualities he praised, they were also displaying an inordinate desire to get rich quickly with a minimum of physical effort. The first striking manifestation of this personality trait was in Florida. There, in the mid-twenties, Miami, Miami Beach, Coral Gables, the East Coast as far north as Palm Beach, and the cities over on the Gulf had been struck by the great Florida real estate boom. The Florida boom contained all of the elements of the classic speculative bubble. There was the indispensable element of substance. Florida had a better winter climate than New York, Chicago, or Minneapolis. Higher incomes and better transportation were making it increasingly accessible to the frost-bound North. The time indeed was coming when the annual flight to the South would be as regular and impressive as the migrations of the Canada Goose.

    On that indispensable element of fact men and women had proceeded to build a world of speculative make-believe. This is a world inhabited not by people who have to be persuaded to believe but by people who want an excuse to believe. In the case of Florida, they wanted to believe that the whole peninsula would soon be populated by the holiday-makers and the sun-worshippers of a new and remarkably indolent era. So great would be the crush that beaches, bogs, swamps, and common scrubland would all have value. The Florida climate obviously did not insure that this would happen. But it did enable people who wanted to believe it would happen so to believe.

    However, speculation does not depend entirely on the capacity for self-delusion. In Florida land was divided into building lots and sold for a 10 percent down payment. Palpably, much of the unlovely terrain that thus changed hands was as repugnant to the people who bought it as to the passer-by. The buyers did not expect to live on it; it was not easy to suppose that anyone ever would. But these were academic considerations. The reality was that this dubious asset was gaining in value by the day and could be sold at a handsome profit in a fortnight. It is another feature of the speculative mood that, as time passes, the tendency to look beyond the simple fact of increasing values to the reasons on which it depends greatly diminishes. And there is no reason why anyone should do so as long as the supply of people who buy with the expectation of selling at a profit continues to be augmented at a sufficiently rapid rate to keep prices rising.”

  • #95666
    Profile photo of Anonymous
    Anonymous
    Participant

    @mark wrote:

    Richard, I hope you are right. But with government debts at unprecedented (peacetime) levels, don’t be too sure. They would be the biggest beneficiaries of inflation.

    Shakeel. The stock market crash was in October 1929. After that came an economic depression (mainly in the US) with deflation, not inflation. But back then the government raised taxes, cut spending, and raised tariffs. This time they have been spending and printing money like no tomorrow, so very different.

    I happen to know this because I’ve just finished reading The Great Crash of 1929, by JK Galbraith, which I highly recommend. Makes you realise it has all happened before, so we shouldn’t be surprised. May even happen again in my lifetime.

    There is a brilliant section early in the book on the Florida real estate boom and bust of 1925. It is exactly what happened in Spain earlier this decade. Read it and weep:

    “One thing in the twenties should have been visible even to [President Calvin] Coolidge. It concerned the American people of whose character he had spoken so well. Along with the sterling qualities he praised, they were also displaying an inordinate desire to get rich quickly with a minimum of physical effort. The first striking manifestation of this personality trait was in Florida. There, in the mid-twenties, Miami, Miami Beach, Coral Gables, the East Coast as far north as Palm Beach, and the cities over on the Gulf had been struck by the great Florida real estate boom. The Florida boom contained all of the elements of the classic speculative bubble. There was the indispensable element of substance. Florida had a better winter climate than New York, Chicago, or Minneapolis. Higher incomes and better transportation were making it increasingly accessible to the frost-bound North. The time indeed was coming when the annual flight to the South would be as regular and impressive as the migrations of the Canada Goose.

    On that indispensable element of fact men and women had proceeded to build a world of speculative make-believe. This is a world inhabited not by people who have to be persuaded to believe but by people who want an excuse to believe. In the case of Florida, they wanted to believe that the whole peninsula would soon be populated by the holiday-makers and the sun-worshippers of a new and remarkably indolent era. So great would be the crush that beaches, bogs, swamps, and common scrubland would all have value. The Florida climate obviously did not insure that this would happen. But it did enable people who wanted to believe it would happen so to believe.

    However, speculation does not depend entirely on the capacity for self-delusion. In Florida land was divided into building lots and sold for a 10 percent down payment. Palpably, much of the unlovely terrain that thus changed hands was as repugnant to the people who bought it as to the passer-by. The buyers did not expect to live on it; it was not easy to suppose that anyone ever would. But these were academic considerations. The reality was that this dubious asset was gaining in value by the day and could be sold at a handsome profit in a fortnight. It is another feature of the speculative mood that, as time passes, the tendency to look beyond the simple fact of increasing values to the reasons on which it depends greatly diminishes. And there is no reason why anyone should do so as long as the supply of people who buy with the expectation of selling at a profit continues to be augmented at a sufficiently rapid rate to keep prices rising.”

    “The Great Crash of 1929” was repeated almost identical in 2001-2006 in Florida.
    Again people were sold the idea that a plateau of high prices had been reached and everybody can get rich without working just by flipping real estate…

    The bad news was that the Florida story was repeated almost everywhere around the Globe this time.

    The good news is that it seems that Bernacke is a smarter person than the ones of 1929-1933.

    Who knows, maybe we can get through this mess without much suffering…

  • #95667
    Profile photo of Anonymous
    Anonymous
    Participant

    Thanks Mark. Yes it was followed up by deflation. Journalist, economic writer & thinkers were expecting to happen this time round too (excluding Japan )

    The decsion taken this time round is opposite to what was done in the past and on a global level, hyper inflation is very much on the card. Action need to be taken and in some measured form. One thing is ceratin it will hurt & no one will be amuned from it.

    I will drop an hint for people to place a copy of Professor Galbraith book under my Christmas tree. This should cheer me up over the festive period.

  • #95695
    Profile photo of Anonymous
    Anonymous
    Participant

    @mark wrote:

    The inflation scenario is something I’ve been worrying about for a while. Nobody is really talking about it, but I expect it will be big news in future.

    I don’t expect hyperinflation a la Bob Mugabe, but I do expect double figures in the medium term. Inflation is one way to deal with our massive debts (inflation reduces the real value of debt). Most governments, including UK and Spain, are too spineless to go down the other road, which is spend less and tax more.

    And let’s face it, nobody has a bigger interest in a dose of high inflation that eats away debt than our governments, who are borrowing like there is no tomorrow, literally. “Inflation is always and everywhere a monetary phenomenon,” said Friedman. Well, our central banks are furiously printing money (they dress it up with fancy names like ‘quantitative easing’) and unless you trust the shower that lead us not to screw it up big time, then you should be expecting high inflation down the line. I do. And never forget, inflation is a sort of tax on savings. Politicians just love to get their hands on your savings.

    And what should do you do if you expect high inflation? Get into hard assets like commodities and property (and gold, of course). Cash in the bank will just evaporate.

    That said, I’m not suggesting you should start buying up flats in forlorn developments on the Spanish coast. I think you can do better than that. But I wouldn’t rule out the possibility that, in 5 years time, your cash might be better off even in one of those forlorn developments than in the bank. Crazy world we live in.

    Hi Mark,

    there is a nice article which argues against the inflationary scenario:

    “the solution to today’s fiscal crisis is the same as it has always been: to cut spending, reduce the deficit and learn to live within our means.”

    http://www.telegraph.co.uk/finance/comment/edmundconway/6830938/Theres-only-one-escape-from-our-debt-trap.html

  • #95835
    Profile photo of Anonymous
    Anonymous
    Participant

    You really do hate quite a few things don’t you Katy. What is your problem woman? You do realise that bitterness eventually consumes its host.

    Jeez, everyone is aware of the corruption and the manipulation and the surplus stock and the lies and the unscrupulous practices. And yes, agents and those with vested interests will ALWAYS talk up the market – it’s their job. I don’t like property spruikers any more than you do, but like recruitment agents (don’t get me started), we won’t be getting rid of them any time soon.

    Maybe you should fly over here to Melbourne and observe the circus that passes for a public auctioning of residential property – with phantom bidders provided by the selling agent. Then you might feel less enraged by Spanish practices. Oh, and if you think property is overvalued there, or in the UK, I urge you to sample the property delights of Sydney and Melbourne. If the property bubble is ever allowed to burst here (the only western nation not to have had a correction), then you will be able to witness the total disintegration of a nation (really).

    I get a little terse about it – the whole country is in a state of collective willing suspension of disbelief. But I am not bitter – I just continue to rent, and smile, and think “you’re all going to get shafted at some point soon”.

    But then maybe I’m wrong – as they say, you should follow the money. Ho hum – it doesn’t really matter does it. Next year, next year, next year – it never comes. You have to be happy with today and take your pleasures as readily as you find them.

    Oh, and by the way, I just sold my penthouse in Gran Bahia de Marbella (which I bought in 2005) and guess what…..given the euro exchange rate to sterling I DID NOT MAKE A LOSS. Who’dathunk it was possible?

    Funny, good things happen to people now and again. Think on Kate, start enjoying the good things, and try to ignore the rest.

    (I’m assuming you have not been personally swindled or cheated by the Spanish market. If you have, please ignore my comments above and feel free to rant and rage ’til your head pops off).

    @katy wrote:

    I am confused is it 2 million illegal houses or 2 million unsold 😯

    I may buy a few now the rush has started or maybe I shall try to sell 😆

    Seriously, my spanish Lawyer neighbour says there is nothing selling on the coast. This was backed up by his Father who is Notary. Still, what do we people know compared to a selective few……..we know nothing, we are wrong

    Can I just add I HATE BA AND THEIR TROLLY DOLLIES. There was I prepared to fly off to paradise (real paradise that is 😆 ) and no flight 😈

  • #95836
    Profile photo of Anonymous
    Anonymous
    Participant

    @Salinger wrote:

    You really do hate quite a few things don’t you Katy. What is your problem woman? You do realise that bitterness eventually consumes its host.

    Jeez, everyone is aware of the corruption and the manipulation and the surplus stock and the lies and the unscrupulous practices. And yes, agents and those with vested interests will ALWAYS talk up the market – it’s their job. I don’t like property spruikers any more than you do, but like recruitment agents (don’t get me started), we won’t be getting rid of them any time soon.

    Maybe you should fly over here to Melbourne and observe the circus that passes for a public auctioning of residential property – with phantom bidders provided by the selling agent. Then you might feel less enraged by Spanish practices. Oh, and if you think property is overvalued there, or in the UK, I urge you to sample the property delights of Sydney and Melbourne. If the property bubble is ever allowed to burst here (the only western nation not to have had a correction), then you will be able to witness the total disintegration of a nation (really).

    I get a little terse about it – the whole country is in a state of collective willing suspension of disbelief. But I am not bitter – I just continue to rent, and smile, and think “you’re all going to get shafted at some point soon”.

    But then maybe I’m wrong – as they say, you should follow the money. Ho hum – it doesn’t really matter does it. Next year, next year, next year – it never comes. You have to be happy with today and take your pleasures as readily as you find them.

    Oh, and by the way, I just sold my penthouse in Gran Bahia de Marbella (which I bought in 2005) and guess what…..given the euro exchange rate to sterling I DID NOT MAKE A LOSS. Who’dathunk it was possible?

    Funny, good things happen to people now and again. Think on Kate, start enjoying the good things, and try to ignore the rest.

    (I’m assuming you have not been personally swindled or cheated by the Spanish market. If you have, please ignore my comments above and feel free to rant and rage ’til your head pops off).

    @katy wrote:

    I am confused is it 2 million illegal houses or 2 million unsold 😯

    I may buy a few now the rush has started or maybe I shall try to sell 😆

    Seriously, my spanish Lawyer neighbour says there is nothing selling on the coast. This was backed up by his Father who is Notary. Still, what do we people know compared to a selective few……..we know nothing, we are wrong

    Can I just add I HATE BA AND THEIR TROLLY DOLLIES. There was I prepared to fly off to paradise (real paradise that is 😆 ) and no flight 😈

    Hi there,
    Good post,
    Can someone tell me where this paradise is where there is no corruption or injustice.
    I have been involved in local and central government for many years in all areas from the smallest to the largest of organisations. I have been an employee, a consultant and mayor of a large town.
    You only have to scratch lightly to find corruption, nepotism, sheer waste, incompetence and injustice.
    Yes I have been ripped of for a considerable sum in Spain, however we love the country, its climate and its people and will soon make the move. This will be for lifestyle choice and not for financial gain.
    This we hope will be our little bit of paradise so just get on with enjoying life, you dont know what the future will bring (would you want to) so enjoy every day and every new experience its what makes us fully rounded and happy human beings.

  • #95852
    Profile photo of Anonymous
    Anonymous
    Participant

    @rob6578 wrote:

    alanthornton:

    Transparency International defines ‘corruption’ as:

    ‘the abuse of entrusted power for private gain’.

    Please explain why you think the UK government decision on spending is ‘corruption’?

    i wouldn’t say its corruption but i’d say this government is as incompatent as nick leeson

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