What to do about 25,000 newly built homes in Madrid that can’t find a buyer? On present trends that will be the size of the Spanish capital’s housing overhang at the end of the year, according to developers.
Finally, it has dawned on developers that the only way to shift their stock of newly built properties in the capital is by dropping their prices, reports the Spanish daily ‘El Pais’.
But lower prices don’t mean sales if buyers can’t get financing. So developers have teamed up with several leading banks, such as Santander, BBVA, La Caixa, Caja Madrid, Popular and Banesto, to offer discounted properties with mortgage financing.
The developers involved promise to sell their properties for a maximum price of between 2,000 and 3,200 Euros per square metre, depending upon the district. According to this formula, a 100 m2 flat in the capital will not cost more than 320,000 Euros.
The regional government says that represents a discount of 20% from current market prices.