- This topic has 30 replies, 11 voices, and was last updated 15 years, 7 months ago by
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Interesting reading:
http://news.kyero.com/2009/1/29/spanish-property-costa-comparison -
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Thank you for posting that helpful link Claire. I do think that realism in the Spanish property market has yet to arrive and these figures tend to confirm that view. Vendors still believe they can recover their expenditure. Not so surprising since no one wants to lose money. However that situation will change as the recession bites hard and vendors get increasingly desperate to sell. Lat month almost half a million more unemployed claimed the dole in Spain increasing the total to 14% of the working population.
I don’t want to be seen like a vulture waiting for the carcase but when demand falls off a cliff who wants to invest when the market has a long way to fall? Good business is about timing, knowing when to get in and when to get out. I am keeping my powder dry. -
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There is also the added problem of vendors and buyers not declaring the true selling price at the Notary. So any survey of true purchase prices would be unreliable.
Has anyone got a system to discover just what property is actually selling for at the moment. That is assuming some property is being sold.
My best guess is 30-40% below the asking price but its only an estimate.
I have some property elsewhere in the EU and receive offers of 50% below asking price on a regular basis. Mostly from fellow speculators. -
Logan, from my research I think your figure of 30-40% is in the right ballpark although, like anyone I´m wading through the dark. In his new year review on Kyero, Martin Dell observed that asking prices bore no resemblance to sales prices and suggested that purchasers offer 30% less than the asking price.
I´m a cash buyer currently looking for a property in a particular part of the CDS. The headline figures appear not to have fallen at all however when I scratch beneath the surface discounts in the range you have mentioned do seem to be there for the taking.
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I have observed that the number of properties on Kyero declined from about 100K when looking 6 months ago to about 76K now.
So they lost 25% of business.
Is it because people advertise the properties somewhere else (if yes, where?) or people just do not put anymore properties on the market?
Also, what is going to happen to the 1 MIllion+ properties which are empty? Are they going to mostly bulldoze them away?
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@katy wrote:
If people have large mortgages (most do). They cannot reduce by 30%+. I do know a few who have withdrawn their for sale properties.
If they do not want to reduce by 30% now, then they will need to reduce by 50% next year.
Or hold on on the property for another 10 year till prices come back…I know it is an extremely unpleasant situation.
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Many people with high mortgages can only go down the route of repossession unfortunatly.
To sell the property below the outstanding mortgage value will require the vendor to hand over thousands of euro’s at the Notary to settle the mortgage. If they had that kind of money they would be able to continue paying their repayments.
If they allow repossession at least they can skip off without having to find a shortfall.
Many people are doing just this at present. Who knows if the banks will chase them for the outstanding balance, most will go to ground and be difficult to track and the banks are so inundated with defaulters that it could take years to find them.
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As potential buyer I´m feeling very insecure at the moment.
When is the right time and what is the right price after all discusions and price reductions seen on different web-sites.
I´m looking for a holiday villa (3Beds) since one year now and couldn´t make up my mind until now.
One example Pedreguer,detached villa 3Bed, with pool,build 2003.
Jan 2008 internet asking price 315.000 €
Apr 2008 295.000
Today asking 245.000At least I know now that I have saved a lot of money 😉
Compared to the house prices in germany it´s still a awfull lot of money.
So i will wait till my next visit to Spain (Apr) to have again a look on site.Regards Sunwind
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Hi
I complete on a property next week in Calahonda, Am I mad?, dont know but feeling so so nervous. Have I made the bigest mistake of my life ?,have I just blown it all?.
Back to the thread for a mo, property prices have been falling and probably will for some time to come, then I guess they will eventually bottom out and only ever improve if demand returns.
On the subject of what percentage fall,as others have said, I feel that you need to measure the drop from the peak sometime around 2005 to now, on that basis there are many properties on the CDS that have dropped in price by 30-40%
However there are other properties that have come on to the market more recently that are sensibly priced, it will be intresting to see by how much they fall.
One thing is for sure, the long period of denial both by vendors and agents alike is well and truly over.
There are now some good bargains to be had, or is there?,I have managed to get my house down about 34% from its asking price in 2006 if it goes down another 10% it won’t be to terrible for me.BUT
If Spain comes out of the euro and devalues its currencey to stimulate the economy WE WILL ALL BE DOOMED, you will be able to pick up a large villa in Marbella for £100,000.Steve
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@Peter Good wrote:
If they allow repossession at least they can skip off without having to find a shortfall.
Many people are doing just this at present. Who knows if the banks will chase them for the outstanding balance, most will go to ground and be difficult to track and the banks are so inundated with defaulters that it could take years to find them.
As predicted long ago (based on USA situation), many people will be jingle-mailing the keys to the banks. The banks will be so inundated with keys that they will never be able to chase them all.
On the other hand, I read somewhere that some Spanish banks do not offer anymore mortgages to foreigners (especially not to Brits). Is it true?
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@flosmichael wrote:
@Peter Good wrote:
If they allow repossession at least they can skip off without having to find a shortfall.
Many people are doing just this at present. Who knows if the banks will chase them for the outstanding balance, most will go to ground and be difficult to track and the banks are so inundated with defaulters that it could take years to find them.
As predicted long ago (based on USA situation), many people will be jingle-mailing the keys to the banks. The banks will be so inundated with keys that they will never be able to chase them all.
On the other hand, I read somewhere that some Spanish banks do not offer anymore mortgages to foreigners (especially not to Brits). Is it true?
Banco Santander may not be so silly buying up all the UK banks.
They simply check Alliance & Leicester, Bradford and Bingley and Abbey account holders and if they match a mortgage default in Spain they might just clean out that account. 😯
With low give-away price of UK banks, it could be the cheapest way of chasing defaulters.
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@Peter Good wrote:
Banco Santander may not be so silly buying up all the UK banks.
They simply check Alliance & Leicester, Bradford and Bingley and Abbey account holders and if they match a mortgage default in Spain they might just clean out that account. 😯
With low give-away price of UK banks, it could be the cheapest way of chasing defaulters.
Maybe the mortgages defaulters are not so stupid either… They can always put money in their wifes/husbands/children names. They can even change their names (it is worth doing so to avoid paying the 200K Euros one might have lost on Spanish property).
Also, where are all these repossesed properties going to be sold? I know that in Spain
the bankers relatives and friends get the best deals out of repossesion market… -
@flosmichael wrote:
Also, where are all these repossesed properties going to be sold? I know that in Spain
the bankers relatives and relatives get the best deals out of repossesion market…I have always contested the way any bank disposes of a property.
Although the bank has a right to repossess, it should be made law that the best price possible be acheived and, if there is any residue after reasonable costs are taken, the balance should be given back to the owner.
If Spanish banks just let them go to their relatives and friends, how can they be seen to be achieving a fair price.?
My friend had his property repossessed before Christmas, the lawyers fee to the bank for repossession was €18,000. For what, the process to do this is not complicated and can be overseen by a clerk booking around 20 hrs work over a 9 month period.
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@Peter Good wrote:
If Spanish banks just let them go to their relatives and friends, how can they be seen to be achieving a fair price.?
This is exactly why I was asking.
I know that the relatives/friends cannot buy all the repossesed properties so some of them should be sold to outsiders. But where can one find a reliable list?
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@flosmichael wrote:
@Peter Good wrote:
If Spanish banks just let them go to their relatives and friends, how can they be seen to be achieving a fair price.?
This is exactly why I was asking.
I know that the relatives/friends cannot buy all the repossesed properties so some of them should be sold to outsiders. But where can one find a reliable list?
The lists can be found on half a dozen website that are either owned by the banks or where they are in partnership with Spanish property agents.
Put a search in google in Spanish and you will find them easily enough. Though it could take you a while to wade through their piles of slum properties in some dubious city areas.
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@Peter Good wrote:
Put a search in google in Spanish and you will find them easily enough. Though it could take you a while to wade through their piles of slum properties in some dubious city areas.
I looked at Caja Madrid subastas, their prices are higher than the ones on Kyero.
I guess I am comparing too much with USA foreclosures where the foreclosed properties could really be obtained for reasonable prices… -
@Stevev6 wrote:
Hi
If Spain comes out of the euro and devalues its currencey to stimulate the economy WE WILL ALL BE DOOMED, you will be able to pick up a large villa in Marbella for £100,000.
Steve
It is unlikely Spain will leave the Euro but not for the villa to be bought for 100K.
Now is not the time to buy in Spain and you will lose money by completing now.
However you have to balance that inevitable loss to come with the life style choices the property will deliver. Do not believe you can cover your costs by renting. Spain is awash with cheap property for rent.
Developers are flooding new builds on the market they cannot sell and offering them for rent long term at very low levels.
I guess the best comparison is a new car. When you buy a new car you know you will lose money the moment you drive it away. That loss is sustained until you sell it. However the enjoyment is some compensation.
So be prepared Steve to take a loss but enjoy the experience!When banks sell off repo properties it is done through private auctions where the public are not admitted. The sale price is simply the cost to the bank nothing more. Most bidders are speculators and insiders, lawyers and developers. Its all very bent but that’s Spain folks, get used to it. I cannot imagine Spanish banks bothering to chase defaulters around the globe. Why would they, the asset is theirs. They know its a hiding to nothing.
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@logan wrote:
When banks sell off repo properties it is done through private auctions where the public are not admitted. The sale price is simply the cost to the bank nothing more. Most bidders are speculators and insiders, lawyers and developers. .
I do not doubt that, but cam the insiders buy all the 1 million+ properties that need to be sold on the firesale? There might be some little bones left for the outsiders…
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@katy wrote:
Good point! We did it last time and things are certainly worse now. Probably take a year or two before the banks get real (or desperate) though.
I guess time is on the buyers side, especially for the ones that still have to see many places before deciding…
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Logan
Thanks for your comments, you have understood my position, and yes we hope to get the life style benifits that you refer to.
You are right to say that Spain won’t leave the euro however it is a possibility, probably a greater possibility than the prospect of Lehman Bros going bust a year ago.
In terms of Spanish property ownership, Spain coming out of the euro poses a greater risk to perspective purchasers/owners than any other any factor today, 30-40% reduction would immediately go to 70-80%.Steve
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