June 30, 2012 at 10:58 am #56881
A Cousin of a Spanish friend of mine is a Bank manager in Malaga. I had a meeting with him with a view to making an offer on Bank embargoed properties. ( They are about 52 of them that are unsold )
A 37m2 with parking & storage in Malaga city was originally for sale at €243k, the Bank reduced it to €132k. I made an offer for €70k.
My offer was made ten days ago. The Bank manager in my presence spoke to who ever he had to & gave my passport details etc.
Todate, I have not heard anything from the Bank this ofcourse does not surprise me as I know Spain to well. I would have thought one of the following should have happened.
a) Offer rejected & advised accordingly say within 48 hours.
b) Bank should have reverted to me with a counter offer.
c) Accepted the price with variations i.e. take one of their mortgage or other products. So what they lose on the swings they win on the round abouts.
If they now come to me which I dont expect. I will revise my offer downward to say €60K.
In the past two years I have made offers on bank properties & none of them have been accepted.
To put it simply why should the Bank accept an offer when they can get the money from the EU a point that I had raised on another thread..
June 30, 2012 at 4:52 pm #109984GarySFBCNParticipant
shakeel, I can’t comment about Spain, but the same thing happens here in the US. People make offers on bank-owned properties and more often than not, do not get any response from the bank for months. Putting a time-based contingency in the offer does little to move things along.
I believe that banks do this for economic reasons: If banks did start selling their inventories, prices would fall and that would erode the value of the remaining inventories.
Having an undefined process and only allowing a trickle of their home to sale saves face and delays a potential “day of reckoning” for the banking industry.
June 30, 2012 at 10:13 pm #109989
Thank you Gary, I take all that you say on board. I feel we have moved away from face savings. As there is no face to save as all is laid bare infront of the whole world.
The sale of the property would have been a private transcation i.e. not via a agent or another Bank etc. through personal contacts i.e. anchufes.
If the Bank had agreed. I had collected friends and together we would have purchased another 15 to 20 properties as we have a business plan for the properties that is very viable if the volume discount could be haD.
July 1, 2012 at 9:11 am #109990
Banks needs to be forced to sell these things because what happens if they accept an offer like this is that they actually “loose” money since it’s collateral for other things at a certain value. This starts a downward going spiral that makes the banks go banrupt… not that it should though. It’s all about fake values in the banks portfolio and how they can get away with it.
If you study the reserve ratio demands you will find that in reality a bank actually makes a better deal to keep these sort of portfolios since it’s so easy to fiddle with their values. This means have cheaper costs for other loans. Indirectly these costs are carried by the rest of the banks customers and in the end the tax payers.
July 1, 2012 at 7:38 pm #110008
I do know of someone who put in an offer on a bank property – he did however have to telephone the bank constantly, each week & month to see if the offer had been reviewed/looked at or accepted – EVENTUALLY his perseverence paid off & his offer was accepted. I dont know if it was just that they were sick of hearing from him week in week out but it worked so if i were you, keep phoning & keep on their back it may just pay off. My only concern (which we are debating at the moment) is that even though you can sometimes grab a good deal/bargain – the tax office catch up with you. Six months after the transaction, you receive a tax bill on the difference between what you paid for the property and what the Spanish Tax Office think your property is worth (considerably more than what you paid) – very unfair but you have only a couple of weeks to pay this and if you dont, it incurs penalties for late payments and interest until you do pay, so just beware – that bargain you think you are getting may actually not be that much of a bargain after all!
July 1, 2012 at 9:40 pm #110009
I do not have to buy and as such can take it or leave it. As far I am concerned the Bank could have sold one property & this would also given me the opportunity to buy the others that I mentioned as I have investors waiting for decesion. The business plan & model is all in place.
On the point of taxation. I am well aware of the situation. The chances reduces when buying from a Bank than a private seller.
I have a well respected “Gestor” who would have obtained the go head from the Hacienda before hand . Failing this I would not buy the property and just walk away. It may be arrogant of me but its my money that they need!!!!!!!!!!
The property is in Malaga capital and such I have to view the price offered as four times the salary of average Spainard as Malaga is not a non resident market..
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