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Good that i found this forum, i would love to know your opinion about the following :
We are currently looking at the possibility of buying a house on the costa blanca, more specific the Calpe/Altea/Javea area. I have read that the housing market is about to crash, or is already starting.
As we are in the market for a big “villa” of about 800k-1.1mil (Euro), i would like to know how you perceive the market in that area. The house would not be for investment but to live in permanently. However it will need to be sold in about 10-12 years.
My initial thoughts would be to offer around 70-75% of the asking price, would that be realistic in this price section ?
We (that’s my wife and myself) will be visiting the area from this week friday to make up our minds. We have a rule that we never ever buy on the first visit/trip to an area, it’s just to “feel the market”.
Side question : how is the crime rate in that area, is it “dangerous” to have an upmarket property ?
Thanks !
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Hi glmike
A few comments but please bear in mind this is only MHO.
Calpe is quite developed with a lot of high rise apartment and hotel blocks, there is however still a lovely old town. In its favour beaches are great. Predominently a German resort town.
Altea, the main residential area of Altea will be altea hills where million euro + villas abound, views from here are great but it is a bit detached from the town and shops. The old town and church are a treat, beaches mostly large pebble.
Javea, much more diverse in the types of locations and choice of property. There are 3 area to Javea, the main beach area, Arenal, the Port, and the old town. It seems they have come to their senses before overdevelopment happens no new buildings over 3 storeys.
Also consider Moraira and Denia if you want coastal.
Prices as in most places have been under pressure and a deal can certainly be struck however again IMHO the owner of more expensive properties seem less desperate or in such dire need to reduce prices drastically. Where you will find a bargain is not so much by reducing the price making low offers but by finding those properties where people have at last had a realisation about what their property is really worth. Many properties have been listed at the price the vendor considers it to be worth with often many 000’s difference on similar sized villas.
Happy hunting
Jim
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Thanks for the tips Jim, very helpfull. There is quite a big selection of houses for sale at the moment, with very different “price / performance” ratios.
It’s probably better like you wrote, to pick the best and make a realistic offer. That is always the difficult part, the offers should be just enough to make the current owner think about selling. That’s why i asked for a general guideline of starting offer percentage.
If i compare to here (germany and Netherlands), buying a standard house the offer can not be much lower than about 95%. However when buying top of the line property, you can easily start at 70% without the owner going berserk.
Is it also possible to devide the Spanish market like that ? Are offers on “normal” houses closer to the asking price than on more up market property ?.
Thanks !
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Glmike
There is still plenty of over-priced property on the market in that area, though vendors are starting to get real. Make sure you look at good selection of properties around your budget to get a good feel for market prices. Build a comparative table of all the properties you see, to help you evaluate prices. And remember that cheap does not necessarily mean good value.
When making an offer it depends upon the asking price, which is why market research is so important. A property that is priced to sell needs a different response to one that is way over-priced. Someone once said that if you aren’t embarrassed by your offer then it’s too high. There is some truth in that, but you also have to avoid absurd offers that mark you out as a joker, not a serious buyer. As a general rule 20% below asking prices isn’t an unreasonable starting point the present market in that area, especially if you can back up the offer with a demonstration that funds are in place and you can proceed quickly. But as always it depends upon the property, the asking price, and the circumstances of the vendor.
If you want to talk to an estate agent try David Mear at Villa Mia. He is based in Javea. Contact details here:
http://www.spanishpropertyinsight.com/estate_agents_in_spain.htm#javeaGood luck. Let us know how you get on.
Mark
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Thanks for the tips, we are flying there on friday and i’ll report back after the trip !
Side question, i found out that you can deduct 20% of the interest and payments (!?) of your mortgage from the Spain income tax. There is apparently a maximum to this, but cannot find it. Anyone here in the know maybe ?
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Have a good trip
I know you said you wouldnt buy this time around and that is was a fact finding mission, but just in case you get tempted!! Be careful with new or nearly new property in Javea, townhall records and administration is woefully out of date and despite everything being legal, some properties are still awaiting habitacion Certificates.
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It’s interesting that you write that, because i have seen quite a good selection of nearly completed property in Javea on the internet that looks like reasonable value for money.
Without a habitacion certificate, i guess you would have to wait a long time before utilities are connected ?
If we would be interested in such a property, is it best to let it go or is it also possible to take delivery (and pay) after utilities are connected ?
Not that we are buying on this trip, but we would on the next if we like it there.
Thanks!
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@glmike wrote:
Good that i found this forum, i would love to know your opinion about the following :
We are currently looking at the possibility of buying a house on the costa blanca, more specific the Calpe/Altea/Javea area. I have read that the housing market is about to crash, or is already starting.
As we are in the market for a big “villa” of about 800k-1.1mil (Euro), i would like to know how you perceive the market in that area. The house would not be for investment but to live in permanently. However it will need to be sold in about 10-12 years.
My initial thoughts would be to offer around 70-75% of the asking price, would that be realistic in this price section ?
We (that’s my wife and myself) will be visiting the area from this week friday to make up our minds. We have a rule that we never ever buy on the first visit/trip to an area, it’s just to “feel the market”.
Side question : how is the crime rate in that area, is it “dangerous” to have an upmarket property ?
Thanks !
After all the apocryphal tales of woe on this forum, not forgetting the reality of the impending housing market crash, why are you even contemplating investing in Spain? 😯
I consider ourselves lucky.
Back in February just before we were due to complete on an off-plan flat (Costa Blanca area) we canceled our contract with the builder incurring a 25% penalty against our deposit which was refunded to us. Had we attempted to do that in the current climate I wonder whether they would have proved to be quite so amenable…
Cancelling actually left us with more money than had we completed the purchase and then attempted to sell (assuming it would ever sell) It also spared us the considerable frustration of having to deal with all the lazy incompetents who we met throughout the entire purchasing process. They being the solicitors, the agent and even the mortgage company.
Good that i found this forum, i would love to know your opinion about the following …
Simple. My advice to you would be to run a mile in the opposite direction and don’t look back 😉
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MrBen – despite the many ‘tales of woe’ and warnings on this forum re. buying property in Spain (many contributed by me…!) – I would still never advocate that buyers should be totally put off buying in Spain.
It is still a wonderful country with a very special, unique culture. The name of the game is learning by these experiences posted here, being aware of the pitfalls and choosing your independent lawyer, agent and property carefully. There are millions of foreign happy bunnies living in Spain – and help is out there to achieve just that.
Recommended agents and lawyers on this forum is a good start…..click on the ‘Resources & Solutions’ above.
P.S. Love your sign-off signature by the way! 😉
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glmike – I have to agree with MrBen. Buying property in Spain should not have to be a “game” but from the many contributions to Our Petition it is clear that at the moment it is a very risky one. Even folk who have done all their research & got their ‘independent recommended lawyer’ are finding themselves in dire straits.
The corruption is deep-rooted, & until this is seriously addressed and intrinsic changes are made your money, in my opinion, would be safer & probably earn you more if you invested in ERNIE ❗ More fun at the moment too 🙂
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What about wait till after the crash and buy at 1/2 price?
That would certainly make a lot of sense if you are
a) patient enough to sit on your money and wait the (long) time for the (lets call it) “re-adjustment” to take its course and,
b) were also good at identifying when the very bottom of that particular dip had occurred.Personally, I couldn’t be bothered or have the patience to waste that amount of time nor do I think afterwards prices will climb as rapidly as they had been doing previously.
I think there are plenty of other (imho better) opportunities to be had elsewhere 😉
(Edit) I thought I’d better mention that no, I’m not an “expert” either, just someone who has made some money with properties in the past.
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MrBen wrote:a) patient enough to sit on your money and wait the (long) time for the (lets call it) “re-adjustment” to take its course and,
b) were also good at identifying when the very bottom of that particular dip had occurred.(Edit) I thought I’d better mention that no, I’m not an “expert” either, just someone who has made some money with properties in the past.
OK, if you want to make money form property in Spain, then you need to wait at least 10-15 years to see today’s prices again.
About being patient, I guess nobody wants to lose money so the patience is a must, not a matter of choice.
The bottom is quite hard to identify, but there is alull period after the bottom when prices do not increase too much. Or wait till everybody (newspapers, friends, relatives, the shoe shining boy) says that it is extremely stupid to purchase in Spain and that is the bottom.
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Forgot that this thread was still running, and opened another one for my experiences in the Altea area. Nevermind i’ll continue here.
As one poster here wrote, “why invest in spain in this time” and “run a mile and don’t look back”. I tend too agree a lot with that.
However i am not looking for an investment but a place to live. The word “boring” does not even begin to describe my current location, and the Altea area is quite the opposite of that 🙂
I do have enourmous doubts about spending so much money in spain, the fact that the Altea area is one of the most expensive ones on the costa blanca not making it any easier. Still the 700-900k Ballester appartments in Altea hills are bought off-plan like spain is still in the boom times…
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Notice the “….” at the end, i tried to make it clear that i think it’s completly silly. You get about 120m2 inside + big terrace. Plus there is a 2,5 year wait until finished. The ballester builder showed me the plans and already 7 sold of the 20+. :?.
I am just as amazed as you at those prices, and certainly not considering to buy it.
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@Latchy wrote:
No gold taps,just THE place to live on the CB.
Yup that’s the problem, it’s The place with The view and The people. It’s just a question of asking myself to be “poor” among the rich crowd or rich among the poor crowd.
In my opinion i also found The property under 1m euro, but i have the handicap that i actually know building costs and land prices. My calculations make it just about 200.000 euro too expensive for what you get. In my book that’s an Aston Martin plus a porsche for aereofrito.
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@Claire wrote:
Is Altea Hills on the mountainside with views to the Marina?
Altea hills overlooks the entire marina/altea/albir/benidorm area. The streets right next to altea hills are actually better in my opinion as they are not so close to the motorway as parts of altea hills. The view from for example the calle de costa azahar, at about 250m above sea level, is amazing. You see the altea/albir/benidorm coastline, at night with all the lights on it’s like you are in a landing plane.
Of course the price premium is very high and like all things you probably get used to the view and won’t notice it much anymore after some time.
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Mike, the reason I asked was because many years ago we were staying at a friends apartment close to the Marina and Altea Hills( as I now know it to be) was just being launched. We went twice to the sales office to look at the plans. They were less to buy then than a 1/2 bed apartment is now on the CDS!! We decided that with paying the mortgage and our childrens school fees we would possibly overstretch ourselves. Oh! that we had been braver!!!!!! 😆
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DO NOT I bought one 6 years ago. biggest reget of my life. Full of concrete. Full of crime. How ever if you must, there is hundred of estate agents waiting to sell you one of the litally tens of thousands of available vacant properties. However if you wait until the property resale market crashes completely you should get a 70% price reduction
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Glmike ,I have been carrying more research into the property market both in the UK and and in Spain,and without boring you and every one else into a coma, I would wait at least another 6 months , before making any decision to purchase in Spain,for a whole raft of reasons there is going to be a substantial correction in the Spanish property market ,but of course anything to do with property takes time ,this current situation will also take time to work through . The Property market as you know is similar to a tanker and it does not respond quickly to imputs, there have been a large number of highly informed postings , these have included some excellent links ,in trying to put all this information together a number of cast iron points have emerged ,one important aspect is how mortgages are now bundled up and re sold on the finance markets,hedge funds are active in this area, this naturally has obvious implications in how these loans will be viewed as the property market slows.
Add in huge confusion regarding the overall future of planning issues in Spain ,and the fact that the second wave of corruption and scandals is now starting to unfold ,and all the ingredients are there for a prolonged slow down.
I understand that you are considering a quality property and when the going gets tough ,there is always a flight to quality as a hedge ,the point is that even quality property will be marked down albeit to a lesser degree ,but no matter why pay more than what you have to,I must admit that I have become some thing of an anorak when pouring over these economic tomes ,but one thread has remained consistent throughout is that it will be impossible to avoid the collateral damage that will occur as these highly stressed financial instruments react to market forces .
I have recently read how the collapse in the US property market could effect the banking system world wide due to the function of loan spreading, By the sound of it you do not need to buy now ,I realize that it is a rather tedious process house hunting and buying ,but by early next year things will look a little clearer,winter will be with us and this could be an opportunity for a very agreeable winter break and another reconnoitre.
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GSB, Don’t worry about boring me or others, that was a very informative read ! 🙂 You are right in that i don’t have to buy now, i still have to start selling my house in Germany. This could take anywhere from 4 weeks to a year so planning is difficult.
However no need to rush, i could easily wait half a year before selling. The houses that are now for sale in the area that i am interested in in spain, will probably be still for sale by that time. I do know how to calculate the building costs of a property, and found that most of them in altea/javea are overpriced by at least 200k and that’s without taking into account that the land is also overpriced.
Just for fun : Square meter price here, Emsland area, in a good town is about 80 euro, houses are about 950 euro per square meter inside space inclusive everything except the kitchen. Free unlimited boredom included 😉
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Glmike,By way of a comparison we were looking to completely reform a traditional stone Masia ,with no access to utilities up a track in the Serra de Tivissa ,the build cost for that project a year ago was in the region of 1100 euro’s per sq mtr, clearly all materials had to be brought to site some distance from the main road ,along with water and power generation,based on current factors ,I would think your 950 euro ‘s per mtr is about right for Spain ,given similar factors.
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