Sent in by email:
I read your report on the Spanish property market and found it very lucid and full of wisdom. I bought my first property in Spain in Tenerife in 1983 and have seen a few ups and downs in the market since then. Never more grim than I see it now. I can’t begin to offer you further analysis on your easy to read and perceptive tome but for my part would comment as follows:
The boom in development in the ‘costas’ is in the main driven by greed. There is little consideration for green areas nor the provision of parking. What has amazed me in a new town such as Las Americas in southern Tenerife is that it is basically only around 30 years old. Licences have been granted for some pretty dense development and yet the majority of the properties 10 years old or more have no or little provision for parking. It would have been so sensible to say to a developer, ?OK, you can build it but we want one car space for every apartment and two for every larger property!?
You can add to this scenario the chaos caused when supplies are delivered to shops and restaurants and double-parking, inconsiderate parking and illegal parking combine to make it hell for road users and particularly for the van driver. I watch in amazement as deliveries are made with sack barrows with which their owners have to contend flights of steps, parked cars and pedestrians to get their wares to their destination. This assists in the damage to pavements that once looked so good but rapidly deteriorate and add to the gloom of high-rise and intensive development equally deteriorating due to lack of maintenance. This lack of essential maintenance can only worsen with the slump now upon us.
I am a lover of Spain, I know it well and speak the language, albeit poorly. What I have seen grow in Las Americas I see elsewhere in the islands and in the Spanish Peninsular. It is a pattern that is copied all too well. For many of us it is the nearest we can get to that dream of a holiday home abroad and it does indeed give us access to Spanish culture, the climate & cuisine. Unfortunately I can only observe that the next few years will see that dream disappear for some of us.
For the record I bought my second Spanish property in Adeje in 2002 and much later had it on the market for just under €500,000. I sold it in May 2006 for €410,000 which less fees and tax left me with about the price I paid for it. Several of my neighbours said they would not accept less than €500,000 for an identical property and they all still have their houses on the market when one or two more desperate neighbours are taking around €360,000 to move on. It is the nature of our lives that from time to time we must move on, but now is not the best of times to do so, unless of course you take a lower price to up-grade. Now that could work!
To my mind the Spanish authorities and Spanish developers cannot expect to build the 800,000 properties annually that I read has been the recent case. The market is finite and despite a slight trend to woo nationals from former eastern bloc European countries a massive correction is on the cards. I just hope that lessons can be learned and Spain can look to under developed territories and build with more consideration and foresight by adopting a different model than that we all see along the costas. Maybe more emphasis on quality and space would appeal to the upper end of the market, while the mid to low end seems to have a few tough years ahead.
Terry & Pat Ralph