House prices in Spain down 30 percent in some areas

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This topic contains 29 replies, has 12 voices, and was last updated by Profile photo of Anonymous Anonymous 8 years, 6 months ago.

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  • #53947
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    Anonymous
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    …..according to Juan Carlos Sandoval. He is President of the Union de Créditos Inmobiliarios, UCI, company which is owned by the Santander and BNP Paribas banks.

    Also Don Piso real estate agency has announced that it is to close 120 of its offices, with the loss of 350 jobs. Most of the offices to close are located in Cataluña. The company has 120 of its own offices and 140 more which operate under a franchise.
    So those that bought a franchise are left to swim on their own?

    http://www.typicallyspanish.com/news/publish/article_16504.shtml

  • #82502
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    Anonymous
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    My husband was listening to a report by Brian Hanrahan ( I think) on Radio 4 yesterday pm about the situation in Spain. He said there were approx 800,000 new builds last year and that there are in the region of 2,000,000 unsold properties. Also said prices were down approx 20-30% on last year.

  • #82505
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    Anonymous
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    Hi,

    I wish someone would tell the main builder I sell for that prices are down 20% to 30%. They havent reduced anything at all and are just sitting on their hands as though nothing has happened.

    I think unless you can show a client there is a genuine reduction in price they are not interested. There are still plenty of people looking for Spain but most seem wise enough to hang on for a decent reduction in price.

    Best wishes

    Bernard

  • #82507
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    Fuengi (Andrew)
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    the article says prices have fallen 30% in some areas. Not throughout spain

  • #82508
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    Anonymous
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    Aplogies Fuengi – have corrected thread title.

  • #82513
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    Fuengi (Andrew)
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    thanks charlie

    don’t mean to be picky, hell i’m willing to bet some areas have fallen by more than that.

  • #82514
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    Anonymous
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    😉

  • #82516
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    Anonymous
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    Hi,

    I think even if there are areas that havent dropped by 30% most buyers will have seen things like this on the news and in the newspapers and expect a discount.

    However even with a 20% to 30% fall in price a lot of this still gets eaten up by the the fall in the level of the pound. Once (or if) the pound returns to a more normal level, these discounts will appear to be genuine discounts to the English buyer. At the moment they just help ease the burden of the falling pound.

    Bring back 1.62€ to £1 !!!!!!!!

  • #82539
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    Anonymous
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    Claire wrote:
    the region of 2,000,000 unsold properties. Also said prices were down approx 20-30% on last year.

    I could bet that price of at least 10% of those unsold properties will go down by at least 80% till the end of the crash. The question is if they are worth even that much money…

  • #82540
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    Anonymous
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    Ralita 🙂
    Why not say 100% and have done with it.

    It is 150 estate agents a month are closing doors in the U.K?
    U.K house prices 50% + down in some areas and falling.?
    The stock market in say the U.K that fell over 20%+ but has bounced back a little propped up by mining stocks.?

    BLOODY MESS EVERYWHERE I THINK.

    You may yet get yer cheap Spanish Property yet but perhaps not in the location you want.

    Just Frank 8)

  • #82545
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    Anonymous
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    Where in the UK are house prices down 50%+?

    From Primelocation.com

    prime property sale prices continue to increase, while prime London rental prices soar to record levels

    The divergence between the prime London market and the mainstream sector continues to grow. All of the publicity in recent times has been concentrated on the mainstream market. The impact of the credit crunch continues to be felt, particularly around mortgages, with some lenders withdrawing products for buyers with smaller deposits and others withdrawing new mortgage lending altogether.

    As a result, mortgage approvals in February were some 39% lower than in the same period last year, forcing many potential buyers out of the market and slowing activity considerably. In the meantime, asking prices across the prime markets (where buyers tend to be less reliant on mortgages) keep on rising. Prime London asking prices hit new heights in March, up a further 3.3%, surpassing £1.3 million for the first time. All regions have witnessed solid growth in asking prices, with Central London the strongest performer.

    The recent rises in prime London asking prices are set against the backdrop of falling stock levels across all regions since the start of 2008. The volume of property for sale has diminished by 11.5% since January, while in March alone, the stock of available property for sale has fallen by 3.7% from February levels. The continuing restriction of supply is helping to keep prices buoyant, while demand from international buyers and City bonus recipients continues to drive interest in the very best properties in the capital.

    *** ********* of Primelocation.com comments, “Despite slowing transaction volumes and weakening market sentiment, the prime London property market continues to produce strong price growth in March. Indeed, the prime markets are showing some resilience in the face of economic uncertainty and the continuing impact of the credit crunch. The increasing divergence between the prime and mainstream sectors reflects the different market forces at play across each area. While the mainstream property market has undoubtedly suffered at the hands of the recent mortgage clampdown, the prime London property market continues to enjoy significant attention from cash-rich, wealthy overseas buyers and the influx of City bonus money, particularly at the top-end (the super-prime market), where demand is the most intense relative to limited supply”.

    I know London and the South East does not constitute the UK as a whole, but as always, good areas , wherever they may be, hold their value. Certainly where I live there is a short supply of property on the market and prices are holding up.

  • #82547
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    Anonymous
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    Claire

    same here in east anglia/south midlands border. Prices changing very little, and no sign of large reductions.

    Small pockets being hit at the moment in some parts of UK, but nothing like the scale in Spain. I don’t think that will happen. A very different supply/demand situation, add to that a property system that on the whole is fairly good and well regulated, and it’s a very different story.

    though things look like getting worse here, with cost of living prices on the rise, i think comparisons at the moment with Spain, are pretty much a nonsense.

  • #82549
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    Anonymous
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    Hi Goodstitch,
    I think price rises in food and fuels is a BIG worry. I must admit, I never really looked at prices too much when doing the supermarket shop. If we needed/wanted it I bought it. Now I am looking at prices more closely and thinking”Hmm, do I really need that this week?” I have really noticed the increase in my bills at the checkout. It must be so worrying for people on fixed incomes and with families to support.

    All these massive price rises and now they are thinking of introducing “Pay as you throw” rubbish collection tax. What the hell does council tax cover? 😈 Add to that the old age tax the government want to introduce. Hells teeth! Spain sounds like a better option by the day. (Did I really say that? :wink:)
    Sorry, I’m completely off topic….and starting a rant! 😳

  • #82551
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    logan
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    I am currently searching for a property in the Murcia/Almeria region.
    It is very frustrating to read on the one hand property is falling in value and on all agents and developers web sites prices remain as high as a year ago, sometimes longer. This despite the property remaining unsold. At Polaris World they are even increasing their prices. Jeeze!!
    I personally will not enter the market until I see evidence of realistic prices corrections. It is not enough just to say ‘make an offer’ buyers need some guide lines.
    A large dose of realism is urgently required before the coming economic and property collapse becomes a disaster. Agents and sellers are fooling no one. It’s as if their heads are buried in the sand and hoping the reality will go away.
    In the meantime I will sit on my hands.

  • #82552
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    katy
    Spectator

    Prices haven’t gone down on the CDS, only a matter of time I think as there aren’t many selling. The myth about lower prices is the agents new slogan. Before it was buy now and get 30% profit, now its buy now as prices have fallen. Many agents are telling sellers to ask more than they will sell for as their clients will expect a reduction!

  • #82553
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    Anonymous
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    logan

    there must be many like you, sitting on your hands, terrified of getting the timing wrong, with regards to a what looks like a crash teetering on the edge. I guess there’s great efforts to stop the flood gates opening which could send the market in to freefall?

    Claire

    i know where you’re coming from, i also feel very much for those on fixed/ low incomes, and it’s hard to see where improvement will come from?

    Having said that, watching the news recently, i just feel lucky to live in a relative paradise compared to many. We take so much for granted in this country.

  • #82558
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    Anonymous
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    Having said that, watching the news recently, i just feel lucky to live in a relative paradise compared to many. We take so much for granted in this country.
    True goodstitch. Maybe that’s the problem and that is why all the financial doom & gloom news comes as rather a shock…or wake-up call. 😕

  • #82559
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    Hi Claire
    Try some of the areas that Inside Track sold

    Just Frank 8)

  • #82582
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    @logan wrote:

    I personally will not enter the market until I see evidence of realistic prices corrections. It is not enough just to say ‘make an offer’ buyers need some guide lines.
    A large dose of realism is urgently required before the coming economic and property collapse becomes a disaster. Agents and sellers are fooling no one. It’s as if their heads are buried in the sand and hoping the reality will go away.
    In the meantime I will sit on my hands.

    Pretty much my experience too. here (Gran Alacant, near Alicante) houses of the same type range from 169K to 237K (asking price) in the same location. Agents tell me that these houses may sell for 160K or less. But other agents are in complete denial.

    This situation gives some sellers false hope, and just keeps the market a confusing mess for all.

    I have also been to new developments and these too are massively overpriced. For example, 280K for a place that really is worth circa 150K

    I am also seeing distressed sales & repossessions on the web, and the asking price is higher than these houses were selling for 18 months ago!

    Property needs to be realistically priced to help stimulate the market. There are buyers out there, but they need to see something approaching realistic pricing.

  • #82587
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    Inez
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    Very true and it is a very confusing situation. A distressed seller is relative to his pesonal situation and doesnt mean the property is cheap, just his circumstances make him distressed.

    As long as you know your areas or know an agent who has been around for a while who can explain where they should be and then you like the property, you will be ok. Also if buying to live in and use, peaks and troughs wont bother you too much – hopefully!

  • #82589
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    Anonymous
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    A question for those involved in the property world or those ‘in the know’.
    There is much talk so far about prices for new developments struggling price-wise and re. slow sales.
    Can you tell me
    a) whether it is the same situation for inland finca-type properties (in Andalucia specifically) or are they more or less holding their prices so far?
    and
    b) are there many ‘flooding the market’ or are most owners sitting tight?

  • #82592
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    Inez
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    I dont do anything inland particularly as its not my field, but I have been getting more and more requests from people wanting to auction – I dont know if thats cos they aint selling or beacause theyve heard of it.

    Having said that the last few that have rung have said they have been trying to sell for a few years now.

    I cant see that there wont be a ripple effect, people in the boom years who couldnt afford the coastal prices kept moving in until they could buy – same as the UK, so those areas would have been raised by the bubble effect – guess they have to come down somewhat now.

  • #82598
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    Well, I am certainly no expert on inland property. But, I have spent months looking at property inland. Prices appear to be holding up on the face of it. BUT, as on the coast I think that there is a lot of silly things going on, and I strongly suspect that very little is selling.

    My opinion is that inland property has the same problems as coastal ones. Of course there is less development, but then there are less buyers too!

    Again, pricing seems to be based upon nothing more than the whim of the agent. I saw a house last week with the owner for 126K (plus 3K for the agent), and then got the same house from a different agent for 165K. IMHO the house was worth 95K or thereabouts.

  • #82599
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    Inez
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    Ah yes but thats based on the traditiona system of the owner placing a price on the proeprty and the agent adding his comm on. Mainly cos Spanish owners will not pay commission and deal direct to each other and also in the old days proeprties were too cheap (yes really) to make any money out of a comission!

  • #82611
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    In the Murcia/Almeria area there are conflicting signs which is causing some confusion as to wether we will see large reductions.

    Almeria city and Roquettas area is seeing resale properties holding their prices or showing only a slight drop. However there are many new build projects bailing out before the banks foreclose, hence large developments being offered at the builders mortgage price, only problem is they want to sell the whole lot in one go and are not interested in individual purchasers. Pity really because if these projects sell to another promoter they will put them back on the market at full price and so the individual bargain hunter doesn´t get a look-in.

    In the Albox area of Almeria there are some big changes of prices resale-wise, with many properties selling for around 30% less than 18 months ago. But, then again, prices had risen ridiculously high and very quickly so it was obvious they would drop equally as quickly.

    Murcia is a different story really. Prices are not really dropping by any more than 10-20% for resales and new-builds are not dropping at all, except for a few left-overs at PW.

    Properties within a 20km radius of the new international airport at Corvera are holding their price, and some are increasing as the airport opening date is only 2 years or so away. Most people are hanging on expecting to see a surge in prices as time ticks by.

    The critical time for any real change will come after the summer, I expect all the areas in question to see bigger falls, but there is a limit on these falls, dependant upon how low the owners are prepared to go. Many have 70-80% mortgages and can´t afford to drop more than 20-30% .

    I have come across the occasional 40% + drop in price but they are very rare and usually do not involve an agent and their fees.

    In summary, and speaking as an agent, the best way to buy a bargain is to go direct to the owner and drive a hard bargain for yourself. This advice doesn´t help my business, but, I lived through the good times and don´t see why any agent that did shouldn´t have a bit of hardship to test their dedication to the proffession. If an agent is good, they will just about survive on reccommendations, if they are not so good, or indeed downright rogues, then they will go out to graze in Bulgaria.

    I plan to stay for as long as I enjoy the job, I might survive even, but whatever happens I have been lucky to be able to do it in a wonderful climate in a relaxed and pleasant enviroment. I shall stay in Spain as I can´t think of a better place to be, but it is no suprise to see the rogue agents leaving Spain as their prey have declined, fairweather friends and all that, I hope they never return.

    Phew, after typing that the last few paragraphs seemed like a rant, but they weren´t, just my personal feelings I suppose.

  • #82614
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    katy
    Spectator

    The problem with many Inland properties (in addition to being overpriced) is they are not legal. Albox is mentioned on here, a google will open your eyes 😯 Those a short distance from the CDS have coastal prices.

  • #82615
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    @katy wrote:

    The problem with many Inland properties (in addition to being overpriced) is they are not legal. Albox is mentioned on here, a google will open your eyes 😯 Those a short distance from the CDS have coastal prices.

    Indeed Katy, I touched on resales in Albox area (legal ones of course) however, I should have mentioned that if anyone is contemplating having a property built in that area, be very, very careful as there is a huge amount of illegal build. Also those with all documentation at present could see the licenses revoke due to the unscrupulous ways in which they were obtained.

    In short, do not buy there at present, as it could be years before all the dirty linen is aired. I would say it´s the biggest blackspot in Spain.

  • #82617
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    “Murcia is a different story really. Prices are not really dropping by any more than 10-20% for resales and new-builds are not dropping at all, except for a few left-overs at PW.”

    Both Murcia and Almeria are way overpriced.

    But there are reasons for the prices to hold in Murcia and drop faster in Almeria..

    One is the existence of 3 airports in the vicinity (Valencia is a bit far but there is a good highway, Alicante and San Javier are very, very close). plus another one to be built soon.

    Murcia is a nice cultural city, also Cartagena.

    The part of Almeria I visited (from Carboneras to Vera) is a desert area with not much to do except stay at the beach.

    One thing I do not understand is why the prices in Torrevieja area are 50% (or less) of those in say San Javier area. There are only 28km between them, both are near the beach and I do
    not think San Javier is a pretty city…

    Is it just the oversupply in Torrevieja which determines the difference?

  • #82620
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    logan
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    @peter Good wrote:

    In summary, and speaking as an agent, the best way to buy a bargain is to go direct to the owner and drive a hard bargain for yourself.

    Wow Peter, an honest agent at last. You are a rare breed indeed. Very refreshing honesty.
    I have now decided that the Spanish market is much too uncertain right now to invest. I have looked at zillions of places with both agents and sellers in the last few months and I am shocked at the unreality of everyone. Perhaps they don’t read the FT or watch Bloomberg and only listen to the ‘expert’ down the local bar but there’s a slow train coming.
    I am based in SW France and here the market is real and sustainable simply because the greed of the last few years in the property market never happened to any extent.
    The Spanish market has to decline to ‘fair value’ in relation to other EU countries.
    For example a new 2 bed condo in the costal midi region of France will cost you about 120-130k depending on the M2 space, view etc. That has been the situation for many years with a steady 5% rise in value.
    In Spain the price can be literally anything depending on the area.
    My point is within the eurozone ‘fair value’ in markets is the key to price stability. Until folks in Spain and the UK wake up to the fact that a house or condo is somewhere to live or have a holiday and not to make megabucks the better it will be for all concerned.

  • #82624
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    Until folks in Spain and the UK wake up to the fact that a house or condo is somewhere to live or have a holiday and not to make megabucks the better it will be for all concerned.

    Very true Logan. 🙂

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