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It is now official.
Spanish Real Estate bubble bursts today Tuesday 24th April 2007 following last week’s market meltdown of Astroc. Real Estate companies listed in the spanish Stock Exchange are losing over two digits this morning.
Panick is catching on like wildfire over to bank’s stocks with heavy interest in mortgages.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a2DEgwGoH3qA&refer=home
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So far today, the IBEX35 is down 2.24%. This is the Spanish stock market’s main index, a bit like the Footse in London.
It’s carnage today.
Some property-related stocks this morning:
ACS –4.17%
Lots of banks down between 2 and 4% (mortgage exposure, lending to developers)
FCC –5.04%
METROVACESA –3.65%
SACYR –5.74%
INMOCARAL –11.27%
INMOCOLONIA –13.17%
FADESA –11.06%I wonder where this is going to end?
Mark
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Is this the same Bloomberg that forecast the stock market crash a couple of months back?
Is it the same Bloomberg that I get every month and appears to often contradict its previous months?
The recent posting by Barclays talking the market up was irresponsible perhaps this may prove the same.
This may just be what the Spanish government need to sort the corruption out as they for sure will want to sort this out as its now hurting them 😀
While it’s clear that the situation is not very good posting this as a crash and panic at this stage may very well prove to worry many needlessly as while it clear returns will no where near the level of previous years someone pointed out 10% and for the greedy this is not enough.
Not that I am saying there will be 10% growth but this article is clearly this is the result of the Spanish government tightening policy on planning this can be no bad thing in the medium to long term (if true)
Where will it end ?
To many things out of our control to make a call but its surely going to be a few interesting months ahead.Regards
Jim 😀 -
If you don’t believe Bloomberg, or prefer not to, why not take a look at
http://uk.finance.yahoo.com/q?s=FAD.MC or
http://www.fadesa.es/corporativa/corpo_index.php?idioma=1
Or will there be a claim that the figures shown are incorrect? -
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@marios wrote:
Forgetting todays headlines but as an avid watcher of the finance world Bloomberg talk absoloute tosh,much prefer CNBC,Bloomberg just go with the flow with no real reasoning behind there views.
I thought that Bloomberg were reporting a fall in share prices among Spanish companies exposed to the property market. I wonder if the CNBC editorial team trade what they say? I doubt it. 😉
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m.g
I did read it hence my posting. ❓ and yes they the figures may well be incorrect.Goodstich 44 . no property price crash just yet as this is a shares in some companies involved in the stock market.(rather different I am afraid)
Claire
Yep someone on the other forum did make light heart of it as can be seen as he or she says tomorrow it yesterdays chip paper a bit like the one from Barclays last week.Regards
Jim
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I meant to reflect that the Spanish market stock psychology has changed after Astroc’s stock debacle. As long as those RE companies held unreal market values (Astroc for example has no land and never had unlike FADESA) the bubble in the “real” world would be sustained to a greater or lesser extent.
Albeit today the market correction put an end to this “irrational exuberance”. For the first time in years the Spanish media at large (public t.v.’s etc) have spoken outloud of an “asset bubble” which was almost taboo in the broad media and always denied by the Government –for obvious reasons-.
Today may well mean a milestone in the construction frenzy of the last years in Spain, a turning point if you so wish. Only time may discern if today’s events will translate into diminishing “real-world” estate values.
My impression is that Spaniards have been crudely awoken by some massive losses and this in turn will end up changing the market psychology and we will see more and more houses up for sale as events unfold.
Personally I doubt property prices will fall more than 30% at most and even so it’s nothing when they have tripled within the last seven years. The problem being of course for those who bought at the market’s peak (mid 2004) or even later.
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m.g
No rose tinted glasses.I have an apartment that if I could sell tomorrow I would get around 340,000euoros however my neighbour has his on the market for 449,000 so for him to be realistic he would have to drop by a similar amout as the one you have quoted.
Just a case of people being realistic really as many have put silly sale prices which had had no baring whatsover on the market and this is where you will hear the main falls.(hardley a crash just a wake up call)
Cant see why this just cant be understood as this is all part of the cycle in any investment or the real worldRegards
Jim -
Now this is a strange one. It is said “as this is all part of the cycle in any investment”, although just a few weeks ago, I recall the “cycle” which I mentioned was questioned, I thing by our friend glassman?
“Where does this 10 year cycle start from?”Where is the low point”/Where is the middle point” Where is the,high poin …”
Regarding the variance in apartment cost, could it be possible that the more expensive on has a higher standard fit-out, fixtures, furnishings?
It’s just like saying the house next to mine in UK is £250K dearer than mine. -
Hi m.g
It would clearly be expensive fittings ❓ 😕
Is the house next to you £250 K more than yours if not if they are trying to sell then they to will a have a shock if its not the case.
Your clearly having a problem or perhaps its me not explaining myself.
With regards to the two apartments,they are both unfurnished but they are asking silly money,
With regards to the cycle they seem to think its on the increase and like the apartment you mentioned are going to be in for a bit of a shock but this is not a price crash” Its a Helloooow wake up time.
You say someone accepted a price 35%percent les than they were asking in what they really did is accept what it was worth and not some stupid inflated price .
At the best my apartment is worth what I paid 3 years ago and may take a few years to see any return whatsover and hardly a case of looking through rose tinted glasses is it . ❓
On the E.O.S site one of the threads is saying that business is brisk amonst good estate agents but I choose to take this with a pinch of salt and move on.
In the case of this threads name I felt it was perhaps needed balancing to avoid some worrying when they perhaps need not.Regards to you
Jim 😀 -
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I have to thank all you guys. Reading this forum has been brilliant and full of excellent views and advice. I was going to buy and visited Granada region looking at properties. Will I buy now? – no chance. Will others buy?- I dought it. There was an article on Radio 4 Business news this morning (Wed 25th April) about the state of the Spanish property market and how companies are in serious trouble and banks are calling in loans.
Thank you all again and keep up the good work. 😉
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This should come as no surprise to anybody that follows the Spanish property market. The downturn probably started in 2005, but building work has continued at the same rate with an over supply of 2-bedroom 2-bathroom apartments, add to this the sleaze and corruption and we have the receipt for a correction in property prices. Until the market slack is absorbed and confidence returns it looks dire.
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Claire.
The stock market in direct relation to what may or my not happen yesterday or today is irrelevent as only a while back they were buying heavy in Spanish property as reported by Mark and this is very likely a rebalancing which always causes waves in any sector of any market.
Woundnt mind a bet the some fund managers saw it as a buying opportunity.as some properties that now are selling at prices of 3 to 4 years ago are starting to look value compared to the U.K.
Its now yesterdays news and in the real world of trying to sell news its a blip and the canny ones that are willing to take a longer view will be laughing in the end. 😀
g.n.i.k . 🙂 Think your right and in the end it would be good to know just what our properties are worth and it will take a shake out like this to start to bring some confidence back to the market and this may start by the Spanish government acting fast to sort out the limbo left by corruption.
WHEN and IF this happens I feel that the slack will be taken up in time and then we will have reality.
LYNX 🙂 . Thats my report to and there are some real clever people I hear and they are often the ones that make the money by taking the longer view and this is a great area for many reasons,not withstanding present problems.
Regards
Jim 😀 -
Spanish newspapers today:
El Pais reports that the Government considers the collapse in the share prices of real estate companies on the Stock Market yesterday as ‘an adjustment’.
La Razón leads with the story and says the collapse of the real estate shares provoked an earthquake on the market. The IBEX fell by 2.7% in the second worst session of the year.
ABC considers that there is fear on the markets of a real crisis.The Bank of Spain has said “the bubble will burst slowly……”
or that is what they are hoping….? -
@Drakan wrote:
Personally I doubt property prices will fall more than 30% at most and even so it’s nothing when they have tripled within the last seven years. The problem being of course for those who bought at the market’s peak (mid 2004) or even later.
You speak of a 30% drop in prices as if it is little. If my 50K property trebled to 150K and then fell in price by 30% then it would be worth 105K, I believe. A healthy profit but if I had recently bought the property at 150K then I would be very concerned.
Imagine the effects on sentiment in what has been very much a sentiment driven market. I don’t think I have heard anyone ever give an argument for Spanish property investment…………..I was going to go on to say “based on fundamentals” but as I have never heard any argument other than “it always goes up because it always goes up” that bit was made redundant.
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Its not like this type of thing hasn’t happened before e.g. Japan, Hong Kong, Thailand, UK, The Netherlands, US, Finland, Canada etc. Speculative bubbles are a common occurrence in real estate markets. The next big hot spot markets to fold will probably be Bulgaria and Dubai. The Spanish market will recover long before these markets in my opinion. Its close to the centre of demand in this hemisphere (Western Europe) and the tourist infrastructure is well established.
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I think it’s necessary to look at the bigger picture. The Spanish property market has been driving the economy for years, among other things because home equity has propped up consumer spending. A crisis for real esate firms, constructors and lenders coupled with a fall in house prices will be a serious setback for the Spanish economy. It’s had 14 years of solid growth so a correction seems long overdue. Also bear in mind it has the second-largest current account deficit in the world after the United States – not a good situation to be in.
If the Spanish economy goes into recession, Spaniards won’t be buying homes and so any foreigner can kiss good bye to any investment potential for a long, long time. There’s an interesting take on the situation at: http://www.landsnatch.com
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Ponzi
Agree 100% 😀
Charlie 2.7% that really can be made up and more in one session and remember its news they are selling and only bad news usually sells.
Funny how when the stock market gains say 5% you hear nothing but when it falls by the same it makes front page news.
Also in markets they sometimes create news to take advantage of a buying opportunity.(oil for example)
Just goes to show not to react to every news report you read as people look on these forums for sound advice,not knee jerk reactions.Regards
Jim 😀 -
Individuals will read what they want to from this situation depending on their position in the property market.
What is of concern is when the banks start calling in loans. That could affect many developers which in turn will have a knock on effect and cannot be redressed overnight. IMHOEver the optimist Jim 😉
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Hi Claire
As I said ,just been around the block a few times and tend not to over react.
Time has taught me to sit on the fence sometimes and look at the situation I am in today and then take either a short term,medium or long term view.
At the moment I have the lot but tend to not go down the IF this happens route as it really can cloud real issues and allow some to make silly decisions.
Keeping the head when many panic or you let people make you panic can be a very costly exercise.( particular from the media who clearly have their own motives.)Regards
Jim 😉
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Ponzi
Great chart and captures all of of our variuos situations,very clever.
Think I am in most of them at the moment ! but do I look boffered,face boffered? 😀 😕 😥Charlie.
What can I say gal 😀 We cant get more balanced than that,I am sure that many viewing this thread will appreciate the fact that views have been allowed to be put forward and they can now decide and its now up to them.
Regards
Jim 😀 -
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Don’t forget, we are not just talking house prices here. The Spanish economy has been out of ‘balance’ for some considerable time and manufacturing is weak. The economy has been leaning on property construction for growth. If construction dives, negative balance of trade and a full-blown recession will follow.
And we have global interest rates nudging upwards.
Oh dear – I’m almost enjoying being a pessimist! 🙂
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Spain is only at the start of a correction/crash in property prices, it’s now all over the mainstream media.
http://www.24dash.com/socialhousing/19791.htm
http://news.sky.com/skynews/article/0,,30400-1262560,00.html
Spain was a poor rural economy that grew of the back of tourism, tourism related construction and money from the EU, oh and huge debt.
Anecdotally everyone that I know who owns property in southern Spain whether they bought 8 years or 18 months ago has real problems of one sort or another (many have multiple issues). Only a couple of years ago they all were saying how buying/owning in Spain was wonderful and a real money spinner. Not any more. The majority are trying to sell but have unrealistic expectations of what they can realistically achieve in this market.
The official Spanish stats (just like the US ones) lag behind and don’t reflect the reality on the ground. These things take a long time to peak and a long time to trough. If the peak (in general terms) for the Costa’s popular with Brits was late 2004/5? Then allowing for both the local Spanish problems/conditions and the global economic back drop (rising i/r + credit tightening), the market probably wont bottom for another 3-5 years, say 2010 to 12. What % will property fall, it depends where/how you start measuring from, but many properties that are poorly planned, located and with other problems will effectively be un-sellable. Looking at certain markets it’s obvious that many properties for sale are 20 to 25% above an effective selling price. The problem is many vendors will never get ahead of the game and chase the market down. There is a risk by the time they and/or there Estate Agent realise the price needs reducing to get viewings the market may have shifted.
So like I say regarding % falls. If a property is on the market today for E400k and it’s effective price in today’s market is E300k but the vendor doesn’t reduce to E300k until the market has gone away from him say to E200k, and he eventually sells for E200k.
Is that a 50% fall or a 33% fall? And when you add in the total cost of buying, owning/operating and selling the numbers can get scary.
In Florida they had the biggest boom market in history (2002 to 2006) so with prices only falling 10 to 12% by the official stats how come many that bought prior to the boom (2002) are struggling to break even.
Property can be a great investment it can also be a huge liability. I think in the Uk we are not far from Joe public FTB/newbie BTL’s realising that property can and does go down as well as up, again the mainstream media are paving the way and restructuring expectations. When that happens the UK will join the US, Ireland, Spain and many other markets, in returning some way to prices that are sustainable by fundamentals.
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AOL MAIN NEWS:
Fears that a Spanish property bust could claim thousands of British victims were raised following a massive slump in the country’s real estate market.
Panic selling of shares in Spanish property firms on Tuesday signalled an end to the over-inflated housing boom, with price falls a real possibility, experts said.
It will come as bad news to British holiday home owners, with an estimated 250,000 Spanish properties believed to be in the hands of UK citizens.
Spain has continued to remain a popular destination for British overseas property buyers, many of whom have benefited from price rises over the last decade.
But economists at Lombard Street Research warned that the housing market in Spain is about implode. They said: “The country is over-housed, households are over-indebted and the construction industry continues to churn out homes.”
The situation is in contrast with the UK, where the problem has been a lack of new housing being built, which in turn has led to high house price inflation.
Low interest rates in Europe have fuelled the property market in Spain in recent years, but a slowdown is now deemed to be inevitable by market watchers, amid fears of a significant correction in the Spanish economy.
Leading construction companies listed on Madrid’s IBEX index took a hit on Tuesday as investors offloaded shares in anticipation of the slump. The index closed down 2.7%, with banks, exposed to the mortgage market, following property firms into the red.
High levels of construction have seen Spain become the best housed nation in Europe, and figures show they have the debt to show for it.
Household debt has risen to 133% of disposable income, up from 75% in the late 1990s – sparking fears of a mortgage crises.
Some suggest UK houses are as much as 50% over-valued!!
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Uk prices 50% over valued (I don’t think it is as much as that!) because for every house for sale at least 5 people want it. Under supply…over demand.
Spain is over supply …under demand.
We recently had our house on the market. We sold to the first couple to view. We were let down on the property we were buying and subsequently couldn’t find another suitable property. Our buyers offered us another 8% to get us to move.!! That is how the market is just now in the South of England.Jim, I see yet again you have deleted your original post. 🙄
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Claire,
We should never ignore the value of the individual experiance.
Uk Prices 50% over valued? First question is how are we calculating value.
I’m sure if we are using fundimental based valuing (i.e. income to price multiples or net rental yeild when all costs are allocated) then some properties in the Uk are 50% over valued. Some 40%, 30% but few are fair value.
If we are using ‘current’ market value then every property in the Uk has a definitive ‘current’ market value that is the price it sells (completes) at. As opposed to what the vendor, agent, buyer, valuer, butcher from Gravesend or Mrs Miggins thinks.
Claire you didn’t ‘sell’ your house so 8% above asking price is neither the fundimental or market value, it is however an indication of where the market currently is at the moment. Good houses in good areas will always sell irrespective of the market, subject to price.
If their are 5 buyers chasing every property how come most towns/cities in the UK have several thousand properties for sale many which have been on the market for over 4 months?
As I said yours is an individual experiance. Whats your prognosis for the UK market in the next 4 years and on what do you base it?
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Hi Claire,
50% – I’m only repeating from an article in this weeks Sunday Times. However, I remember previous recessions when money seems to ‘disappear’ and it takes many years to return. I think we are all skating on thin ice and perhaps borrowing to maintain lifestyles.
Still – look on the bright side. At least our kids will be able to afford a house! 😆
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Hi Claire,
50% – I’m only repeating from an article in this weeks Sunday Times. However, I remember previous recessions when money seems to ‘disappear’ and it takes many years to return. I think we are all skating on thin ice and perhaps borrowing to maintain lifestyles.
Still – look on the bright side. At least our kids will be able to afford a house! 😆
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Press articles have been confusing the recent drop in the share price of Spanish property companies with a property market crash. These are separate issues, though of course by dumping property stocks the stock market is saying something about the outlook for the housing market.
Anyway, here’s another cheerful article on recent events, this time from the Telegraph.
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/04/25/cnspain25.xml
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Press articles have been confusing the recent drop in the share price of Spanish property companies with a property market crash. These are separate issues, though of course by dumping property stocks the stock market is saying something about the outlook for the housing market.
Anyway, here’s another cheerful article on recent events, this time from the Telegraph.
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/04/25/cnspain25.xml
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A property is only worth what someone is prepared to pay for it at the end of the day, wherever that may be!
The point I was illustrating is that because there are so few houses to choose from, certainly where I live, prices are high. Supply and demand calls the tune. Our house was realistically priced hence a buyer within days, not weeks or months. We marketed our house 9 months ago. It has now increased in price, but so have other properties. Still we cannot find a comparable property to even take a viewing of! There is certainly “no choice”…unless we win the lottery jackpot!Pablo,
I am not an economist 😆 I have no idea what will happen in 4 years time. That’s why we are not speculators in property.! My husband is waaaay too cautious for that.(…unfortunately for me! 😉 )
Maximus,
Our son has a good job, but has only recently been able to buy a house with our help! He has paid for his first house, more than we paid for our current house 18 1/2 years ago! He is living in a significantly cheaper area than we are too. I do not know how young people manage without huge mortgages. I hope for their sake interest rates do not take off as they did 18 years ago.! Yes they are probably skating on thin ice 🙁 What is the choice though?Had we bought an (legal)apartment in Spain we would not be worried by current events as we wanted a place in the sun for ourselves and our children to enjoy for years to come. We were not speculating. I think only speculators will be worried just now, if they need to sell soon. For wealthy people…what a great time to buy in Spain!.
Just my personal opinion! 😉
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A property is only worth what someone is prepared to pay for it at the end of the day, wherever that may be!
The point I was illustrating is that because there are so few houses to choose from, certainly where I live, prices are high. Supply and demand calls the tune. Our house was realistically priced hence a buyer within days, not weeks or months. We marketed our house 9 months ago. It has now increased in price, but so have other properties. Still we cannot find a comparable property to even take a viewing of! There is certainly “no choice”…unless we win the lottery jackpot!Pablo,
I am not an economist 😆 I have no idea what will happen in 4 years time. That’s why we are not speculators in property.! My husband is waaaay too cautious for that.(…unfortunately for me! 😉 )
Maximus,
Our son has a good job, but has only recently been able to buy a house with our help! He has paid for his first house, more than we paid for our current house 18 1/2 years ago! He is living in a significantly cheaper area than we are too. I do not know how young people manage without huge mortgages. I hope for their sake interest rates do not take off as they did 18 years ago.! Yes they are probably skating on thin ice 🙁 What is the choice though?Had we bought an (legal)apartment in Spain we would not be worried by current events as we wanted a place in the sun for ourselves and our children to enjoy for years to come. We were not speculating. I think only speculators will be worried just now, if they need to sell soon. For wealthy people…what a great time to buy in Spain!.
Just my personal opinion! 😉
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“Pablo Silver or Lead?”
If their are 5 buyers chasing every property how come most towns/cities in the UK have several thousand properties for sale many which have been on the market for over 4 months?
4 months is pretty good I’d say(especially when there is a “chain” of buyers,) as until a “completion” is reached, a property appears to remain “on the market..subject to contract”.
It depends on so many things…and the competency of the lawyers involved.I cannot comment on other towns/cities in the UK , only the region of the UK where I live.
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“Pablo Silver or Lead?”
If their are 5 buyers chasing every property how come most towns/cities in the UK have several thousand properties for sale many which have been on the market for over 4 months?
4 months is pretty good I’d say(especially when there is a “chain” of buyers,) as until a “completion” is reached, a property appears to remain “on the market..subject to contract”.
It depends on so many things…and the competency of the lawyers involved.I cannot comment on other towns/cities in the UK , only the region of the UK where I live.
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@Claire wrote:
Had we bought an (legal)apartment in Spain we would not be worried by current events as we wanted a place in the sun for ourselves and our children to enjoy for years to come. We were not speculating. I think only speculators will be worried just now, if they need to sell soon. For wealthy people…what a great time to buy in Spain!.
Just my personal opinion! 😉
I had a place in the sun, a two bed apartment at 240 euros a month, in the centre of town, basic but very comfortable. To buy it would have cost me 120K euros (similar apartment next door). My money was in a UK bank at the time earning interest at 4%.
So, rent was 240 euros a month
To buy I would have spent 120K euros plus 10% cost of buying (average) meaning a total of 132K to buy.
Therefore every year I would have lost 132K * 4% = 5280 euroa a year = 440 euros a month.
So for me buying was throwing money away. Now that I am getting 5.5% interest on my money I would be more reluctant to buy and I bet rents haven’t gone up too much either
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@Claire wrote:
Had we bought an (legal)apartment in Spain we would not be worried by current events as we wanted a place in the sun for ourselves and our children to enjoy for years to come. We were not speculating. I think only speculators will be worried just now, if they need to sell soon. For wealthy people…what a great time to buy in Spain!.
Just my personal opinion! 😉
I had a place in the sun, a two bed apartment at 240 euros a month, in the centre of town, basic but very comfortable. To buy it would have cost me 120K euros (similar apartment next door). My money was in a UK bank at the time earning interest at 4%.
So, rent was 240 euros a month
To buy I would have spent 120K euros plus 10% cost of buying (average) meaning a total of 132K to buy.
Therefore every year I would have lost 132K * 4% = 5280 euroa a year = 440 euros a month.
So for me buying was throwing money away. Now that I am getting 5.5% interest on my money I would be more reluctant to buy and I bet rents haven’t gone up too much either
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Mike
If you had adopted the same attitude over the last 20 years,think you would have missed many boats. 🙁
For instance lending money at say 5% interest only on a property in the U.K for a start over the past years.?
All the reports on stock markets and investments around the world are based on many factors.
If I sell shares today they are up,if I sell tomorrow they may be down,if I dont sell them then nothing is lost or gained.
As Claire has clearly pointed out that one fact cannot be argued in any preditions that firstly you havent lost anything if your not selling and people will pay for something they want.
Reports this morning that properties in Devon are predicted to go up 17% based on todays infomation,what happens to that report if interest rates go up to 8% tomorrow.?
If they did go up that much and combined with council taxes and ever increasing living costs people many then wish to consider moving to somewhere like Spain so increasing demand.
(not saying that all or any of this may happen but?)
Reports are almost always brought together on the data collected at any one time however as history tells us many factors can change situations or we could all read and newspaper reports and based on that we would be millionaires.Regards
Jim -
Mike
If you had adopted the same attitude over the last 20 years,think you would have missed many boats. 🙁
For instance lending money at say 5% interest only on a property in the U.K for a start over the past years.?
All the reports on stock markets and investments around the world are based on many factors.
If I sell shares today they are up,if I sell tomorrow they may be down,if I dont sell them then nothing is lost or gained.
As Claire has clearly pointed out that one fact cannot be argued in any preditions that firstly you havent lost anything if your not selling and people will pay for something they want.
Reports this morning that properties in Devon are predicted to go up 17% based on todays infomation,what happens to that report if interest rates go up to 8% tomorrow.?
If they did go up that much and combined with council taxes and ever increasing living costs people many then wish to consider moving to somewhere like Spain so increasing demand.
(not saying that all or any of this may happen but?)
Reports are almost always brought together on the data collected at any one time however as history tells us many factors can change situations or we could all read and newspaper reports and based on that we would be millionaires.Regards
Jim -
Mike
i think you are right, i wouldn’t advise anyone to invest in Spain at present (unless you can thrash out a deal far below asking price maybe?)with all the problems, falling prices, over supply, stocks etc. Many people including myself would have been far better off investing in a UK property of some sort, or even putting money in a low interest account! I think that’s common knowledge now, but hard to accept if you have taken the plunge!
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Mike
i think you are right, i wouldn’t advise anyone to invest in Spain at present (unless you can thrash out a deal far below asking price maybe?)with all the problems, falling prices, over supply, stocks etc. Many people including myself would have been far better off investing in a UK property of some sort, or even putting money in a low interest account! I think that’s common knowledge now, but hard to accept if you have taken the plunge!
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Hi Goodstitch,
An “investment” is a gamble – no matter what you invest in.
Everything is speculation.
Nothing is a sure, safe bet….even those institutions who GUARANTEE to return your deposit after X amount of years – but you could earn X% too. In real terms, a winner for the institution taking the money – but a loss for the investor. A perfect get out clause for the institution.
The world of stocks and shares and interest rates is a complicated one and the in-fighting in various institutions makes it even more confusing.
What is a certainty though, and it has been proven over the years, is that investing in property is a sure fire winner GIVEN TIME.
I once worked with a brilliant accountant/property speculator who could argue that the “crash” of the 80’s never happened. His argument for the cycle of the economy (ups, downs but always a gradual underlying increase over the years) was pretty much definitive and I have lived with his words ever since I worked with him back in 1993.
Buy low – sell high.
Or simply buy low and GIVE IT TIME and the gains will be there anyway.
It has been a buyers market in Spain for a long time, and with the current “crisis” looming, it will be a fantastic buyers market.
Also fantastic for the sellers if they bought a while ago as they will still realise profits.
But – and I think some of my very first posts on this forum were along these lines – property should never be seen as a short term, get-rich-quick scheme.
There are those who will be lucky and there will always be opportunities now and again where it can be done. But in the grand scheme of things, property should be a medium to long-term investment.
I have no sympathy for short-term speculators. They know the risks involved and have only their greed to answer to.
I have endless sympathy for the first time buyers…I was one once!
But, even they have to grit it out, take an extra job or two or three (as I have done and still do!) stick with it, and in a few years no doubt they will be able to move another rung up the ladder.
Every economy has to have it’s ups and downs and there are just as many opportunities in the down times as there are in the ups.
Two sides to every coin. -
Hi Goodstitch,
An “investment” is a gamble – no matter what you invest in.
Everything is speculation.
Nothing is a sure, safe bet….even those institutions who GUARANTEE to return your deposit after X amount of years – but you could earn X% too. In real terms, a winner for the institution taking the money – but a loss for the investor. A perfect get out clause for the institution.
The world of stocks and shares and interest rates is a complicated one and the in-fighting in various institutions makes it even more confusing.
What is a certainty though, and it has been proven over the years, is that investing in property is a sure fire winner GIVEN TIME.
I once worked with a brilliant accountant/property speculator who could argue that the “crash” of the 80’s never happened. His argument for the cycle of the economy (ups, downs but always a gradual underlying increase over the years) was pretty much definitive and I have lived with his words ever since I worked with him back in 1993.
Buy low – sell high.
Or simply buy low and GIVE IT TIME and the gains will be there anyway.
It has been a buyers market in Spain for a long time, and with the current “crisis” looming, it will be a fantastic buyers market.
Also fantastic for the sellers if they bought a while ago as they will still realise profits.
But – and I think some of my very first posts on this forum were along these lines – property should never be seen as a short term, get-rich-quick scheme.
There are those who will be lucky and there will always be opportunities now and again where it can be done. But in the grand scheme of things, property should be a medium to long-term investment.
I have no sympathy for short-term speculators. They know the risks involved and have only their greed to answer to.
I have endless sympathy for the first time buyers…I was one once!
But, even they have to grit it out, take an extra job or two or three (as I have done and still do!) stick with it, and in a few years no doubt they will be able to move another rung up the ladder.
Every economy has to have it’s ups and downs and there are just as many opportunities in the down times as there are in the ups.
Two sides to every coin. -
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Its now made the prole’s, sheeples and Watneys Red Barrel brigades rag. The self deluding party is definately over now, the SUN say’s so!
http://www.thesun.co.uk/article/0,,2-2007190265,00.html
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Its now made the prole’s, sheeples and Watneys Red Barrel brigades rag. The self deluding party is definately over now, the SUN say’s so!
http://www.thesun.co.uk/article/0,,2-2007190265,00.html
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😕
My 2p.s worth:
The US property market has dropped considerably, the Spanish market especially coastal is so overpriced and dropping fast, the French market has fallen 20% in many areas and tipped to fall further esp.if the Socialists win, the UK market is busy in London and some other areas esp. the SE, but not buoyant in many areas, there is little or no re-sale market in Bulgaria despite the hype by the dodgy agents who’ve moved there, maybe it’s going to spread elswhere.
Personally Spain has only itself to blame for the current property market, they’ve ignored the crooked dealings for years, not regulated the agents and developers properly, not speeded the Court process up, not rid itself of the criminal Land Grab fiasco, overbuilt and spoilt the Coastline etc etc, and all for greed.
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My 2p.s worth:
The US property market has dropped considerably, the Spanish market especially coastal is so overpriced and dropping fast, the French market has fallen 20% in many areas and tipped to fall further esp.if the Socialists win, the UK market is busy in London and some other areas esp. the SE, but not buoyant in many areas, there is little or no re-sale market in Bulgaria despite the hype by the dodgy agents who’ve moved there, maybe it’s going to spread elswhere.
Personally Spain has only itself to blame for the current property market, they’ve ignored the crooked dealings for years, not regulated the agents and developers properly, not speeded the Court process up, not rid itself of the criminal Land Grab fiasco, overbuilt and spoilt the Coastline etc etc, and all for greed.
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Taken from http://www.isle-of-tenerife.com
Good news on economic front
Inflation in Tenerife and the rest of the Canary Islands is set to fall to just 1.7 per cent by the end of the year, according to a report by the influential Flores de Lemus Institute in Madrid.That would see inflation on the archipelago the lowest in Spain, well below the predicted national average of 2.4 per cent.
There is more good news in the expectation that next year, 2008, inflation in the islands will fall to 1.5 per cent.
In a separate report, the respected institute said it expected inflation in the Eurozone to fall below two per cent
The good news as far as Tenerife is concerned was somewhat mitigated by the news that petrol prices on the island are once more on the increase.
Fuel at the pump has gone up by over six per cent so far this year to around 76 cents a litre (just over 50p a litre) for 95 octane unleaded, while diesel is 64 cents (44p).
The increases have been steeper for drivers of vehicles with petrol engines, who are paying about nine per cent more, while diesel users are paying about four per cent more.
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Taken from http://www.isle-of-tenerife.com
Good news on economic front
Inflation in Tenerife and the rest of the Canary Islands is set to fall to just 1.7 per cent by the end of the year, according to a report by the influential Flores de Lemus Institute in Madrid.That would see inflation on the archipelago the lowest in Spain, well below the predicted national average of 2.4 per cent.
There is more good news in the expectation that next year, 2008, inflation in the islands will fall to 1.5 per cent.
In a separate report, the respected institute said it expected inflation in the Eurozone to fall below two per cent
The good news as far as Tenerife is concerned was somewhat mitigated by the news that petrol prices on the island are once more on the increase.
Fuel at the pump has gone up by over six per cent so far this year to around 76 cents a litre (just over 50p a litre) for 95 octane unleaded, while diesel is 64 cents (44p).
The increases have been steeper for drivers of vehicles with petrol engines, who are paying about nine per cent more, while diesel users are paying about four per cent more.
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As always a few facts would be welcome. i can never understand why there are no clear indices produced either by lenders (like Nationwide and halifax in the UK) or local government in Spain.
Personally i can’t wait to see the cranes come down. But then i’ve been waiting for 4 years and the more people talk of collapse the more cranes i see.
I know. What about a “crane index”…
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As always a few facts would be welcome. i can never understand why there are no clear indices produced either by lenders (like Nationwide and halifax in the UK) or local government in Spain.
Personally i can’t wait to see the cranes come down. But then i’ve been waiting for 4 years and the more people talk of collapse the more cranes i see.
I know. What about a “crane index”…
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Goodstich44.
Its simply sad and for whatever reasons some wish to motivate themselves to only see one side of the coin that has been mentioned.
Not a case I think of either dressing up or down, if anyone wants a balance short or long term view point they need to see both sides.
Lets hope that we both win our case. 😀Regards
Jim 😀
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Goodstich44.
Its simply sad and for whatever reasons some wish to motivate themselves to only see one side of the coin that has been mentioned.
Not a case I think of either dressing up or down, if anyone wants a balance short or long term view point they need to see both sides.
Lets hope that we both win our case. 😀Regards
Jim 😀
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jim
you are missing the point here, i talk as i find, and from 5 years experience of myself and countless others. If a situation is dire, for heaven sake admit it!!! As for for balanced view crap, yes of course we look at both sides of the coin, but in our case there is no balance. We and many others have been screwed by a bunch of sharks operating in a rubbish system that has allowed them to get away with it and in many cases is just as corrupt. I don’t tar every agent, lawyer, developer with the samebrush or economic situation for that matter, of course there are good and bad, but please don’t try and find balance where there is none, trying to do that really is sad!
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jim
you are missing the point here, i talk as i find, and from 5 years experience of myself and countless others. If a situation is dire, for heaven sake admit it!!! As for for balanced view crap, yes of course we look at both sides of the coin, but in our case there is no balance. We and many others have been screwed by a bunch of sharks operating in a rubbish system that has allowed them to get away with it and in many cases is just as corrupt. I don’t tar every agent, lawyer, developer with the samebrush or economic situation for that matter, of course there are good and bad, but please don’t try and find balance where there is none, trying to do that really is sad!
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And let’s not forget the elderly folk who have invested their lifesavings in a new home & retirement in Spain, who are now in truly dire situations. They can’t so easily ‘go out & get a job’ & hope things turn around for them in years to come. The only ‘Balance’ there can be for them is justice, which probably seems light years away 😡
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And let’s not forget the elderly folk who have invested their lifesavings in a new home & retirement in Spain, who are now in truly dire situations. They can’t so easily ‘go out & get a job’ & hope things turn around for them in years to come. The only ‘Balance’ there can be for them is justice, which probably seems light years away 😡
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Goodstich 44
What you simply are failing to see is that the good by far out weighs the bad.
There is another side to the coin and its sad that some do not wish to turn it over.
Case I think for some its tails you loose ,heads you loose whichever way its looked at.
Its everyones choice how they deal with all situations regarding matters where they any system is fair or not but lets face it life does at times kick you up the arse!
If anyone feels that going through newspapers or forums trying to find negative news is the way forward then thats fine by me but I tend to look at the bigger picture.Regards
Jim 😀
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Goodstich 44
What you simply are failing to see is that the good by far out weighs the bad.
There is another side to the coin and its sad that some do not wish to turn it over.
Case I think for some its tails you loose ,heads you loose whichever way its looked at.
Its everyones choice how they deal with all situations regarding matters where they any system is fair or not but lets face it life does at times kick you up the arse!
If anyone feels that going through newspapers or forums trying to find negative news is the way forward then thats fine by me but I tend to look at the bigger picture.Regards
Jim 😀
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Jim
Whilst I agree to your point about balance we have to remember that a lot of people come on to these forums AFTER something has happened. Very few come on to say what a wonderful experience they have had. That being the case those very people are looking for a number of things
1. Advice that can help them out of their sticky mess
2. Solace that they are not the only ones who are in their mess
3. Hope that some have been there before and got retributionSo based in this it is very hard to see how there can be true “Balance” unless you go out and get all those people who have had a wonderful experience to come on and tell their side of the story. And whilst it may be that some people have a negative side – there are some potential 50,000 people or more in the CDS alone – who do not have any “closure” as to their plight. Where is the balance in their lives?
So perhaps whilst you do try and give the positive side and it is helpful to the people who come on here for advice to see that not all is lost, perhaps a little understanding to the people who have had major upheaval in their lives, major worry that things have gone wrong and potentially major losses, would be more welcoming. After all not everyone is able to deal so admirably with the situation as you are
This is not a personal attack so please don’t take it is as such – just trying to offer a balanced opinion – or should that be observation.
Vince
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Jim
Whilst I agree to your point about balance we have to remember that a lot of people come on to these forums AFTER something has happened. Very few come on to say what a wonderful experience they have had. That being the case those very people are looking for a number of things
1. Advice that can help them out of their sticky mess
2. Solace that they are not the only ones who are in their mess
3. Hope that some have been there before and got retributionSo based in this it is very hard to see how there can be true “Balance” unless you go out and get all those people who have had a wonderful experience to come on and tell their side of the story. And whilst it may be that some people have a negative side – there are some potential 50,000 people or more in the CDS alone – who do not have any “closure” as to their plight. Where is the balance in their lives?
So perhaps whilst you do try and give the positive side and it is helpful to the people who come on here for advice to see that not all is lost, perhaps a little understanding to the people who have had major upheaval in their lives, major worry that things have gone wrong and potentially major losses, would be more welcoming. After all not everyone is able to deal so admirably with the situation as you are
This is not a personal attack so please don’t take it is as such – just trying to offer a balanced opinion – or should that be observation.
Vince
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Jim
there is no point in looking at the ‘big picture’ unless you understand or accept what’s in it!. You said- quote
”What you simply are failing to see is that the good by far out weighs the bad”.
………well yes it probably has for some, especially the Sharks!, but for thousands of people, and the vast majority who post on here, that is not the case, so why pretend otherwise?
If someone has had a good experience in Spain, then great, i’m pleased for them and glad to hear about it, that’s all any of us want. like wise if they, like us have had a bad experience then lets shout about it and HELP others not be a victim of the same low-life.
It’s not helping anyone apart from sharks and low-life by not accepting how bad things are for thousands of people, in fact it may do the opposite!
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Jim
there is no point in looking at the ‘big picture’ unless you understand or accept what’s in it!. You said- quote
”What you simply are failing to see is that the good by far out weighs the bad”.
………well yes it probably has for some, especially the Sharks!, but for thousands of people, and the vast majority who post on here, that is not the case, so why pretend otherwise?
If someone has had a good experience in Spain, then great, i’m pleased for them and glad to hear about it, that’s all any of us want. like wise if they, like us have had a bad experience then lets shout about it and HELP others not be a victim of the same low-life.
It’s not helping anyone apart from sharks and low-life by not accepting how bad things are for thousands of people, in fact it may do the opposite!
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@glassman wrote:
Goodstich 44, What you simply are failing to see is that the good by far out weighs the bad.
Jim, your statement above in relation to the topic of this thread is sadly lacking in the truth of the matter, as it stands today.
And if people like Vince and Goodstich are giving any kind of warning as to the wisdom of purchasing in Spain at the moment, I’m afraid in my opinion they are giving more honest and realistic advice.Ashtondav – are you really surprised? Developers and estate agents are Spanish Real Estate – those that construct it, and those that sell it.
Bit like trying to talk about the car industry without mentioning car manufacturers or dodgy car salesmen….. -
@glassman wrote:
Goodstich 44, What you simply are failing to see is that the good by far out weighs the bad.
Jim, your statement above in relation to the topic of this thread is sadly lacking in the truth of the matter, as it stands today.
And if people like Vince and Goodstich are giving any kind of warning as to the wisdom of purchasing in Spain at the moment, I’m afraid in my opinion they are giving more honest and realistic advice.Ashtondav – are you really surprised? Developers and estate agents are Spanish Real Estate – those that construct it, and those that sell it.
Bit like trying to talk about the car industry without mentioning car manufacturers or dodgy car salesmen….. -
😡
Totally agree with charlie, gooodstich and a few others here.
A so called balanced view is a ridiculous suggestion re Spain’s property market and has been for years.
Why? Because it’s basically corrupt, the Gov’t., have done nothing to weed out the crooks who are still operating, no regulation, Land Grab where the Gov’t don’t want to know yet still take IVA on these sales, and as suzanne says, sooooooo many people including pensioners have been totally stitched up by the many dishonest agents, lawyers and developers.
It’s the tip of the iceberg too because many unfortunate people are too embarrassed to tell their tales, I’ve spoken to loads who have lost such a lot (or everything), some who remortgaged their homes in the UK and Ireland to fund their Spanish Dream and now having to pay for their mistakes for years, whilst losing their off-plan properties.
Yes there will be happy people who bought at the right time, or didn’t need mortgages etc, but there must be 1000’s who have lost big time.
Many countries are corrupt with property but Spain must hold the World Cup for mass property corruption and destruction of a once attractive coastline, it’s a b—-y disgrace.
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😡
Totally agree with charlie, gooodstich and a few others here.
A so called balanced view is a ridiculous suggestion re Spain’s property market and has been for years.
Why? Because it’s basically corrupt, the Gov’t., have done nothing to weed out the crooks who are still operating, no regulation, Land Grab where the Gov’t don’t want to know yet still take IVA on these sales, and as suzanne says, sooooooo many people including pensioners have been totally stitched up by the many dishonest agents, lawyers and developers.
It’s the tip of the iceberg too because many unfortunate people are too embarrassed to tell their tales, I’ve spoken to loads who have lost such a lot (or everything), some who remortgaged their homes in the UK and Ireland to fund their Spanish Dream and now having to pay for their mistakes for years, whilst losing their off-plan properties.
Yes there will be happy people who bought at the right time, or didn’t need mortgages etc, but there must be 1000’s who have lost big time.
Many countries are corrupt with property but Spain must hold the World Cup for mass property corruption and destruction of a once attractive coastline, it’s a b—-y disgrace.
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😉
As you say goodstich, what a surprise, it’s been a long time coming but hopefully it will restore some order there.
I feel sorry for the honest agents trying hard, and also the people who will go into negative equity, but if Spain’s Gov’t wakes up and becomes honest for once (doubt it though), weeds out the crooks etc, bulldozes a lot of the eyesores, I could go on and on.
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😉
As you say goodstich, what a surprise, it’s been a long time coming but hopefully it will restore some order there.
I feel sorry for the honest agents trying hard, and also the people who will go into negative equity, but if Spain’s Gov’t wakes up and becomes honest for once (doubt it though), weeds out the crooks etc, bulldozes a lot of the eyesores, I could go on and on.
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Feel sorry for the people who will go into negative equity, well, just a little maybe.
Many went into it with their eyes open and could only see huge profits to be made.
Remember, many borrow to whatever limit they can, without considering what happens in a downturn.
Just remember or read about UK 80’s.
We are now in the spend, spend, spend society, who cry, cry, cry, when things go wrong.
Those genuinely caught up in it and in a position that they have chosen to live abroad and for no fault of their own, stand to loose their home, then 100% sympathy.
Those with high borrowings and from greed borrow further just to have a holiday home that they can rent out, well, tough. You must take the rough with the smooth.
Someone has already pointed out that any investment is a risk and when it is not your money, but the bank. look out, there is trouble. -
Feel sorry for the people who will go into negative equity, well, just a little maybe.
Many went into it with their eyes open and could only see huge profits to be made.
Remember, many borrow to whatever limit they can, without considering what happens in a downturn.
Just remember or read about UK 80’s.
We are now in the spend, spend, spend society, who cry, cry, cry, when things go wrong.
Those genuinely caught up in it and in a position that they have chosen to live abroad and for no fault of their own, stand to loose their home, then 100% sympathy.
Those with high borrowings and from greed borrow further just to have a holiday home that they can rent out, well, tough. You must take the rough with the smooth.
Someone has already pointed out that any investment is a risk and when it is not your money, but the bank. look out, there is trouble. -
Almost everyone I know who has bought/invested/sepeculated in Spain and Florida have remortgaged their UK property to put down a 20%+ deposit. Then taken out a mortgage for the balance. This means they effectively are 100% geared/leveraged.
Leverage as a business tool is a good thing and when the assets your invested in rise, it magnifys your gain. Conversly it has the opposite effect when prices/values fall.
Many may have thought it clever to use ‘other peoples money’ (OPM) to buy properties they couldn’t otherwise have afforded, but the other people are the banks and the debt is yours.
Many will now be caught in the global correction in propertyprices that is now underway.
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Almost everyone I know who has bought/invested/sepeculated in Spain and Florida have remortgaged their UK property to put down a 20%+ deposit. Then taken out a mortgage for the balance. This means they effectively are 100% geared/leveraged.
Leverage as a business tool is a good thing and when the assets your invested in rise, it magnifys your gain. Conversly it has the opposite effect when prices/values fall.
Many may have thought it clever to use ‘other peoples money’ (OPM) to buy properties they couldn’t otherwise have afforded, but the other people are the banks and the debt is yours.
Many will now be caught in the global correction in propertyprices that is now underway.
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Yup agree with that, but in my opinion, if people are silly enough to have remortgaged their UK property to put down a 20%+ deposit, which means that if their dream holiday home goes down the plug, there is a good chance they could lose their home, then, no sympathy from me.
Perhaps they should discover the meaning of the word SAVE?
Stupid thought, nobody wants to wait and everyone expects.
It does seem that many find it easy to spend money when it is not theirs (borrowed) and if the found it necessary to remortgage to raise the deposit, it means they did not own their house in the begining, so, non of the money is theirs.
Wonder if the time will come when banks who fund holiday properties would look for a cut in uplift should there be one? -
Yup agree with that, but in my opinion, if people are silly enough to have remortgaged their UK property to put down a 20%+ deposit, which means that if their dream holiday home goes down the plug, there is a good chance they could lose their home, then, no sympathy from me.
Perhaps they should discover the meaning of the word SAVE?
Stupid thought, nobody wants to wait and everyone expects.
It does seem that many find it easy to spend money when it is not theirs (borrowed) and if the found it necessary to remortgage to raise the deposit, it means they did not own their house in the begining, so, non of the money is theirs.
Wonder if the time will come when banks who fund holiday properties would look for a cut in uplift should there be one? -
pablo
that sounds about right.
mg
i think most accept that buying any property is a gamble and if you lose through market forces, as you say, tough luck, but to say ‘tough luck’ to those who borrowed to rent for a holiday home/retirement, but have been a victim of lies, fraud, dishonesty etc even up to lawyer level, is i think blaming the wrong people. Let’s recognise the low-life sharks for what they are, and give them the justice they deserve. Hopefully in the long term everyone will benefit from that move, even what’s left of poor old Spains lovely coast line, if they move fast on the bad guys!
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pablo
that sounds about right.
mg
i think most accept that buying any property is a gamble and if you lose through market forces, as you say, tough luck, but to say ‘tough luck’ to those who borrowed to rent for a holiday home/retirement, but have been a victim of lies, fraud, dishonesty etc even up to lawyer level, is i think blaming the wrong people. Let’s recognise the low-life sharks for what they are, and give them the justice they deserve. Hopefully in the long term everyone will benefit from that move, even what’s left of poor old Spains lovely coast line, if they move fast on the bad guys!
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goodstich44 wrote:pablo
i think most accept that buying any property is a gamble and if you lose through market forces, as you say, tough luck, but to say ‘tough luck’ to those who borrowed to rent for a holiday home/retirement, but have been a victim of lies, fraud, dishonesty etc even up to lawyer level, is i think blaming the wrong people. Let’s recognise the low-life sharks for what they are, and give them the justice they deserve. Hopefully in the long term everyone will benefit from that move, even what’s left of poor old Spains lovely coast line, if they move fast on the bad guys!I disagree with what you wrote.
1) most of the people are sheeple and they buy to speculate and make easy money by selling to the bigger fool. They might now acknowledge that but this is what they actually do.
2) one cannot blame the lender for offering money. The lenders and realtors are sharks but anybody with a medium degree of intelligence would know that. The lenders are in for business not to take care of uninformed and not so bright buyers.
This will a good lesson for anybody who wants to make easy money with things that he/she does not understand at all.
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goodstich44 wrote:pablo
i think most accept that buying any property is a gamble and if you lose through market forces, as you say, tough luck, but to say ‘tough luck’ to those who borrowed to rent for a holiday home/retirement, but have been a victim of lies, fraud, dishonesty etc even up to lawyer level, is i think blaming the wrong people. Let’s recognise the low-life sharks for what they are, and give them the justice they deserve. Hopefully in the long term everyone will benefit from that move, even what’s left of poor old Spains lovely coast line, if they move fast on the bad guys!I disagree with what you wrote.
1) most of the people are sheeple and they buy to speculate and make easy money by selling to the bigger fool. They might now acknowledge that but this is what they actually do.
2) one cannot blame the lender for offering money. The lenders and realtors are sharks but anybody with a medium degree of intelligence would know that. The lenders are in for business not to take care of uninformed and not so bright buyers.
This will a good lesson for anybody who wants to make easy money with things that he/she does not understand at all.
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“but to say ‘tough luck’ to those who borrowed to rent for a holiday home/retirement” – No, no, no, I said nothing about retirement. Are you now trying to convince me that all who buy to rent have the ultimate aim to live in that property. Sorry, no believe.
So why do so many people in the 30’s and 40’s take such an interest in a retirement home at the risk of their main home. Most buy and hope to make a few bucks renting to repay and also hopefully see a capital gain.
Why not work hard, buy your house in UK (and pay for it) then sell up and retire later in life?“been a victim of lies, fraud, dishonesty etc even up to lawyer level” and in some instances their own stupidity.
“blaming the wrong people. Let’s recognise the low-life sharks for what they are, and give them the justice they deserve” _ So are you saying that the people who have borrowed over their heads in UK to raise a deposit, then have a full loan in Spain for the holiday place, are responsible and no blame at all should be put on them, even though some were aware there was no consent for where they bought.
Somebody said on another thread about there being two sides. Likewise on this?
“Hopefully in the long term everyone will benefit from that move, even what’s left of poor old Spains lovely coast line, if they move fast on the bad guys” – Suppose the rose tinted brigade will follow them to wherever they decide to develop next (Bulgaria)?
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“but to say ‘tough luck’ to those who borrowed to rent for a holiday home/retirement” – No, no, no, I said nothing about retirement. Are you now trying to convince me that all who buy to rent have the ultimate aim to live in that property. Sorry, no believe.
So why do so many people in the 30’s and 40’s take such an interest in a retirement home at the risk of their main home. Most buy and hope to make a few bucks renting to repay and also hopefully see a capital gain.
Why not work hard, buy your house in UK (and pay for it) then sell up and retire later in life?“been a victim of lies, fraud, dishonesty etc even up to lawyer level” and in some instances their own stupidity.
“blaming the wrong people. Let’s recognise the low-life sharks for what they are, and give them the justice they deserve” _ So are you saying that the people who have borrowed over their heads in UK to raise a deposit, then have a full loan in Spain for the holiday place, are responsible and no blame at all should be put on them, even though some were aware there was no consent for where they bought.
Somebody said on another thread about there being two sides. Likewise on this?
“Hopefully in the long term everyone will benefit from that move, even what’s left of poor old Spains lovely coast line, if they move fast on the bad guys” – Suppose the rose tinted brigade will follow them to wherever they decide to develop next (Bulgaria)?
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Well that rather knocks the “the good by far outweighs the bad” on the head, doesn’t it.
Nobody knows the full extent of how the events of this week’s news will affect the next few years in Spain. But when even The Sun is reporting doom and gloom (thank you Pablo for the link) you can be sure that finally the cat truly is out of the bag and that warnings re. the Spanish property market have finally reached the far corners of UK! Just maybe, people will not now get sucked up so blindly at Property Fairs?
These last months I and several others on this forum have often been criticised/labelled as being ‘doom and gloom merchants’. Maybe now we can have a new nickname: ‘Realists’!
(Mark, we need an emoticon with a halo….) -
Well that rather knocks the “the good by far outweighs the bad” on the head, doesn’t it.
Nobody knows the full extent of how the events of this week’s news will affect the next few years in Spain. But when even The Sun is reporting doom and gloom (thank you Pablo for the link) you can be sure that finally the cat truly is out of the bag and that warnings re. the Spanish property market have finally reached the far corners of UK! Just maybe, people will not now get sucked up so blindly at Property Fairs?
These last months I and several others on this forum have often been criticised/labelled as being ‘doom and gloom merchants’. Maybe now we can have a new nickname: ‘Realists’!
(Mark, we need an emoticon with a halo….) -
mg wrote:So why do so many people in the 30’s and 40’s take such an interest in a retirement home at the risk of their main home. Most buy and hope to make a few bucks renting to repay and also hopefully see a capital gain.
Why not work hard, buy your house in UK (and pay for it) then sell up and retire later in life?Well, why work when TV shows claim that you can become rich by flipping houses?
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mg wrote:So why do so many people in the 30’s and 40’s take such an interest in a retirement home at the risk of their main home. Most buy and hope to make a few bucks renting to repay and also hopefully see a capital gain.
Why not work hard, buy your house in UK (and pay for it) then sell up and retire later in life?Well, why work when TV shows claim that you can become rich by flipping houses?
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mg
i’m not talking about making mistakes by over borrowing or even speculating, as i said before, thats a gamble everyone takes at their own risk. I’m talking obout the scum bags that are dishonest, lie, and cheat, to make a living. Please dont put these people in the same bracket as decent hard working people who’s only mistake more often than not, was to trust one of these said scumbags, when they gave them very poor advice or simply lied to them. Does trusting a lawyer make someone a sheep? I’m afraid your attitude of ‘tough luck if you get screwed by one of the sharks’ sounds not unlike the attitude of the low life i’m talking about. If that’s the case, then no, i won’t expect sympathy for the decent person, who in most cases has at worst, put their trust in the wrong person.
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mg
i’m not talking about making mistakes by over borrowing or even speculating, as i said before, thats a gamble everyone takes at their own risk. I’m talking obout the scum bags that are dishonest, lie, and cheat, to make a living. Please dont put these people in the same bracket as decent hard working people who’s only mistake more often than not, was to trust one of these said scumbags, when they gave them very poor advice or simply lied to them. Does trusting a lawyer make someone a sheep? I’m afraid your attitude of ‘tough luck if you get screwed by one of the sharks’ sounds not unlike the attitude of the low life i’m talking about. If that’s the case, then no, i won’t expect sympathy for the decent person, who in most cases has at worst, put their trust in the wrong person.
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“i’m not talking about making mistakes by over borrowing or even speculating, as i said before, thats a gamble everyone takes at their own risk” Sheer stupidity I call it, if you can’t afford to lose it, don’t borrow for it.
“I’m talking obout the scum bags that are dishonest, lie, and cheat, to make a living.” You mean like Joe Public who swindles their motor insurance or DSS in UK and maybe then can afford to by a holiday home.
OK, they maybe “sharks”, but the purchaser in many cases has to accept some responsibility.“Please dont put these people in the same bracket as decent hard working people who’s only mistake more often than not, was to trust one of these said scumbags” Perhaps some form of education is required for some, or do you believe that all should believe the estate agents, window salesman, motor salesman, in UK, with seeking independant advice, if they know nothing about it?
“I’m afraid your attitude of ‘tough luck if you get screwed by one of the sharks’ sounds not unlike the attitude of the low life i’m talking about” OK, your opinion, I say a realist, but if you believe me to be “a shark”, so be it.
I’ll let the employee I bailed out (one who has been caught) of your opinion on me. -
“i’m not talking about making mistakes by over borrowing or even speculating, as i said before, thats a gamble everyone takes at their own risk” Sheer stupidity I call it, if you can’t afford to lose it, don’t borrow for it.
“I’m talking obout the scum bags that are dishonest, lie, and cheat, to make a living.” You mean like Joe Public who swindles their motor insurance or DSS in UK and maybe then can afford to by a holiday home.
OK, they maybe “sharks”, but the purchaser in many cases has to accept some responsibility.“Please dont put these people in the same bracket as decent hard working people who’s only mistake more often than not, was to trust one of these said scumbags” Perhaps some form of education is required for some, or do you believe that all should believe the estate agents, window salesman, motor salesman, in UK, with seeking independant advice, if they know nothing about it?
“I’m afraid your attitude of ‘tough luck if you get screwed by one of the sharks’ sounds not unlike the attitude of the low life i’m talking about” OK, your opinion, I say a realist, but if you believe me to be “a shark”, so be it.
I’ll let the employee I bailed out (one who has been caught) of your opinion on me. -
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goodstich44 wrote:mg
ok, so according to you, joe public that have been swindled are either stupid, or swindling the DHSS, or car insurance, or need educating, or believe everthing they are told or are not realists.
I think that attitude needs no more comment from me, so perphaps best if we just agree to differ.
I also perfectly agree with mg.
Everybody who wanter to make business in Spain was supposed to know that:
– the real estate agents in Spain are sharks and not to be trusted. especially the British agents with business in Spain, they are the most dishonest bunch.
– they need to do their homework, to know before hand what the advantages and disavantages of the place they are interested in
– how much money they can get from rent and how much are the monthly payment rates
– that the Interest Rates were supposed to go up so the payments were supposed to go up.
– etc, etc, etc
Instead, many went like stupid in Spain, had some glasses of wine and fell prey to the sharks who were just surprised on how easy it is to
deceive somebody.Conclusion: British people need a much better education in economic and, especially, Mathematics.
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goodstich44 wrote:mg
ok, so according to you, joe public that have been swindled are either stupid, or swindling the DHSS, or car insurance, or need educating, or believe everthing they are told or are not realists.
I think that attitude needs no more comment from me, so perphaps best if we just agree to differ.
I also perfectly agree with mg.
Everybody who wanter to make business in Spain was supposed to know that:
– the real estate agents in Spain are sharks and not to be trusted. especially the British agents with business in Spain, they are the most dishonest bunch.
– they need to do their homework, to know before hand what the advantages and disavantages of the place they are interested in
– how much money they can get from rent and how much are the monthly payment rates
– that the Interest Rates were supposed to go up so the payments were supposed to go up.
– etc, etc, etc
Instead, many went like stupid in Spain, had some glasses of wine and fell prey to the sharks who were just surprised on how easy it is to
deceive somebody.Conclusion: British people need a much better education in economic and, especially, Mathematics.
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Time for me to sign off here I think.
When contributors obviously either do not understand or cannot read what is written, it is not worth contributing.
“joe public that have been swindled are either stupid” I just cannot see how one can read that from what is written?
Ah well, getting to understand why people get caught now. -
Time for me to sign off here I think.
When contributors obviously either do not understand or cannot read what is written, it is not worth contributing.
“joe public that have been swindled are either stupid” I just cannot see how one can read that from what is written?
Ah well, getting to understand why people get caught now. -
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Vince
Understand completely what you are saying and and well put forward.
Trust me I have as much sympathy as anyone for some who have had experiences of being genuinely conned in any country. 🙁
My only point is that this ground hog day attitude of everyone blaming what has happened in the past needs now balancing with what situation they are in now.
Faced with constant negative reports which many are incorrect (ie their property is going to fall by 30%without qualifing) is not exactly helping some as many of the issues will almost certainly be resolved and are perhaps worrying some needlessly?
If I were not better informed this forum would personally worry me sick.
Many are looking for answers and are very likely well p-s d off already being constantly reminded that they fell pray to the actions of the system is not going to help that many I am afraid. 🙁
Now what may help some is a few of us that have had been involved in the racket are dealing with it and moving forward.
Why on earth someone wants to search around looking only for negative reports and relive everyday the past actions of many low lifes is to me any many others are rather fruitless.
However many do and I for one appreciate that and good luck to them and to those who offer support 😀 😀 😀
1 Pessimistic2 Optimistic
= 3 Realistic
Tend to start at the bottom and start to work my way up and somewhere I get a realistic view and I am smack in the middle of the first two at the moment.Regards
Jim
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Vince
Understand completely what you are saying and and well put forward.
Trust me I have as much sympathy as anyone for some who have had experiences of being genuinely conned in any country. 🙁
My only point is that this ground hog day attitude of everyone blaming what has happened in the past needs now balancing with what situation they are in now.
Faced with constant negative reports which many are incorrect (ie their property is going to fall by 30%without qualifing) is not exactly helping some as many of the issues will almost certainly be resolved and are perhaps worrying some needlessly?
If I were not better informed this forum would personally worry me sick.
Many are looking for answers and are very likely well p-s d off already being constantly reminded that they fell pray to the actions of the system is not going to help that many I am afraid. 🙁
Now what may help some is a few of us that have had been involved in the racket are dealing with it and moving forward.
Why on earth someone wants to search around looking only for negative reports and relive everyday the past actions of many low lifes is to me any many others are rather fruitless.
However many do and I for one appreciate that and good luck to them and to those who offer support 😀 😀 😀
1 Pessimistic2 Optimistic
= 3 Realistic
Tend to start at the bottom and start to work my way up and somewhere I get a realistic view and I am smack in the middle of the first two at the moment.Regards
Jim
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Hi Everyone,
Here’s a few thoughts. Too many properties have been built in Spain. Of that there is no doubt. But you have to look at where they have been built and what the supply/demand mix is in your area. Parts of the Costa del Sol and Costa Blance are saturated with identical and poorly constructed properties. I think it is very difficult to give a view on the value of these houses/flats as there is basically no market.
In other parts of Spain, where there has been less construction, the market dynamics are more positive although I suspect things are going to be pretty flat for a couple of years as mortgage payments for many nationals are consuming too much of their “take home”. It has to be said that well built properties in a good location will always find a buyer, so long as both parties have a realistic view on price.
The corruption at all stages of the buying process in Spain is frankly horrendous. I feel for those who trusted a lawyer to look after their interests, only to discover that everyone in the purchase chain, from the Town Hall through to the Notary, was acting against them.
However, I have a feeling that once the elections are out of the way and a new team is installed in Marbella the market will begin to perk up. I am not in any way underestimating the problems of illegal builds etc but one thing Operacion Malaya has done is to give a radical “Spring Clean” to the whole property sector in Marbella and the CDS.
I don’t think any of us believe that the corruption has been limited solely to the CDS. It might just be that as Marbella begins to purge its system of all the scum that problems will appear in other areas..Almeria,Valencia etc.
Parts of the CDS have been scarred by overbuilding but it still has a great climate and is easily reached from all of N.Europe. In my view, it will not only survive, but prosper over the medium term.
As for Morocco, Bulgaria, all the other countries ending in “ia” and Turkey, I am not so convinced. At the end of the day demographics underpins and directs economies. A recent UN study on population change for the period 2007/2050 makes interesting reading:
UK…+15%
France…+10.7%
Spain…+4.8%Everywhere else populations are predicted to fall eg: Russia -24.3%,
Ukraine -33%,Romania -25.7%,Bulgaria -35.2%,Poland -20.5%,Germany -10.3% and Italy -7.2%. Not very good news for people buying in Bulgaria. Also, many of the “marketing operations” from the CDS have set up shop in these markets and are up to all the usual tricks.Certainly, this projected increase in population will be driven by immigration but immigrants are consumers and need a roof over their heads.
Morocco is receiving an awful lot of press but with one or two more bombs I wonder how long things will hold up. The French secret services reportedly do not understand why so much money is being invested in Morocco and I know a Spanish Bank who will not lend a penny there.
Where is all this leading to. Well my crystal ball is no better than yours but over the piece, my hunch is that the most reliable markets in Europe will be the tried and tested ones…the UK,France,Italy,Spain. You might get lucky elsewhere but don’t bet on it, which is what off-plan purchases in Bulgaria, Morocco etc is…gambling.
Well,think I deserve a Cruz Campo after that.
Good luck to everyone and remember that it is always darkest before the dawn.
Saludos,
Casa La Loba
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Hi Everyone,
Here’s a few thoughts. Too many properties have been built in Spain. Of that there is no doubt. But you have to look at where they have been built and what the supply/demand mix is in your area. Parts of the Costa del Sol and Costa Blance are saturated with identical and poorly constructed properties. I think it is very difficult to give a view on the value of these houses/flats as there is basically no market.
In other parts of Spain, where there has been less construction, the market dynamics are more positive although I suspect things are going to be pretty flat for a couple of years as mortgage payments for many nationals are consuming too much of their “take home”. It has to be said that well built properties in a good location will always find a buyer, so long as both parties have a realistic view on price.
The corruption at all stages of the buying process in Spain is frankly horrendous. I feel for those who trusted a lawyer to look after their interests, only to discover that everyone in the purchase chain, from the Town Hall through to the Notary, was acting against them.
However, I have a feeling that once the elections are out of the way and a new team is installed in Marbella the market will begin to perk up. I am not in any way underestimating the problems of illegal builds etc but one thing Operacion Malaya has done is to give a radical “Spring Clean” to the whole property sector in Marbella and the CDS.
I don’t think any of us believe that the corruption has been limited solely to the CDS. It might just be that as Marbella begins to purge its system of all the scum that problems will appear in other areas..Almeria,Valencia etc.
Parts of the CDS have been scarred by overbuilding but it still has a great climate and is easily reached from all of N.Europe. In my view, it will not only survive, but prosper over the medium term.
As for Morocco, Bulgaria, all the other countries ending in “ia” and Turkey, I am not so convinced. At the end of the day demographics underpins and directs economies. A recent UN study on population change for the period 2007/2050 makes interesting reading:
UK…+15%
France…+10.7%
Spain…+4.8%Everywhere else populations are predicted to fall eg: Russia -24.3%,
Ukraine -33%,Romania -25.7%,Bulgaria -35.2%,Poland -20.5%,Germany -10.3% and Italy -7.2%. Not very good news for people buying in Bulgaria. Also, many of the “marketing operations” from the CDS have set up shop in these markets and are up to all the usual tricks.Certainly, this projected increase in population will be driven by immigration but immigrants are consumers and need a roof over their heads.
Morocco is receiving an awful lot of press but with one or two more bombs I wonder how long things will hold up. The French secret services reportedly do not understand why so much money is being invested in Morocco and I know a Spanish Bank who will not lend a penny there.
Where is all this leading to. Well my crystal ball is no better than yours but over the piece, my hunch is that the most reliable markets in Europe will be the tried and tested ones…the UK,France,Italy,Spain. You might get lucky elsewhere but don’t bet on it, which is what off-plan purchases in Bulgaria, Morocco etc is…gambling.
Well,think I deserve a Cruz Campo after that.
Good luck to everyone and remember that it is always darkest before the dawn.
Saludos,
Casa La Loba
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Hi Casalaloba,
Some good points there, particularly about the increase in demographics.
I’m fortunate enough to live in the West Country which enjoys a pleasant climate and beautiful surroundings. We always seem immune to property price falls because of the constant demand from retirees. More and more people are inheriting wealth and wanting to escape the urban / city stresses by buying here. If you combine this increase in demographics with particularly strict planning regulations, the result is London prices.
Although Spain expects an increase in population it lacks building control. Areas are getting spoilt so demand eventually falls. More worryingly, Al Qaeda has said it wants to regain once-Muslim lands like Al-Andalus (Andalucia).
This could have a devastating effect on property.
http://uk.news.yahoo.com/rtrs/20070422/tpl-uk-qaeda-spain-47c7853.html
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Hi Casalaloba,
Some good points there, particularly about the increase in demographics.
I’m fortunate enough to live in the West Country which enjoys a pleasant climate and beautiful surroundings. We always seem immune to property price falls because of the constant demand from retirees. More and more people are inheriting wealth and wanting to escape the urban / city stresses by buying here. If you combine this increase in demographics with particularly strict planning regulations, the result is London prices.
Although Spain expects an increase in population it lacks building control. Areas are getting spoilt so demand eventually falls. More worryingly, Al Qaeda has said it wants to regain once-Muslim lands like Al-Andalus (Andalucia).
This could have a devastating effect on property.
http://uk.news.yahoo.com/rtrs/20070422/tpl-uk-qaeda-spain-47c7853.html
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Hola Maximus,
I’ve seen the stuff too about Al Qaeda wanting to regain Andalucia but I’m not sure it bothers me too much. I think this is rather exaggerated thinking on their part. I have to tell you that where I live in Andalucia the locals are more than a little zenophobic when it comes to the question of “Moros”. I am sure that the Spanish authorities keep a very close eye on all suspect individuals as they do in the UK but I’m not losing any sleep over it.
What has happened to the housing market in your part of the UK is pretty incredible when one thinks what you would have paid for housing in the West Country 10 years ago.
Saludos,
Casa La Loba
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Hola Maximus,
I’ve seen the stuff too about Al Qaeda wanting to regain Andalucia but I’m not sure it bothers me too much. I think this is rather exaggerated thinking on their part. I have to tell you that where I live in Andalucia the locals are more than a little zenophobic when it comes to the question of “Moros”. I am sure that the Spanish authorities keep a very close eye on all suspect individuals as they do in the UK but I’m not losing any sleep over it.
What has happened to the housing market in your part of the UK is pretty incredible when one thinks what you would have paid for housing in the West Country 10 years ago.
Saludos,
Casa La Loba
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casalaloba
thanks for wishing us all luck, and well done for your post. Great to see fair minded people accepting that it’s the sharks, corruption etc that has done the damage, and not blaming the poor unfortunate people that have been swindled and lied to by them!. As you say, places in the right locations will always sell if not overpriced, and if Spain can get it’s house in order with regards to clearing out the bad people that have done so much damage, then why shouldn’t it recover in medium-long term. Still a great country and very easy to reach from UK, germany etc. As for all the badly built two bed apartments in bad locations, who knows?, i guess they will find their price level as any horrible place in the UK does, or if ruining an otherwise nice location, or badly built, would they be better knocked down, as long as the unfortunate buyer can be compensated?
I really hope that the ‘spring clean’, the elections and the bubble bursting can transform the country where it needs it, but without a crystal ball, i wonder if that’s possible or just wishfull thinking?
It’s rumoured that some of the UK based sharks that have been rumbled are indeed setting up in Morocco, and i’m sure other places where they can lie and cheat to a whole new audience, lets hope their new potential victims have good internet access!!
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casalaloba
thanks for wishing us all luck, and well done for your post. Great to see fair minded people accepting that it’s the sharks, corruption etc that has done the damage, and not blaming the poor unfortunate people that have been swindled and lied to by them!. As you say, places in the right locations will always sell if not overpriced, and if Spain can get it’s house in order with regards to clearing out the bad people that have done so much damage, then why shouldn’t it recover in medium-long term. Still a great country and very easy to reach from UK, germany etc. As for all the badly built two bed apartments in bad locations, who knows?, i guess they will find their price level as any horrible place in the UK does, or if ruining an otherwise nice location, or badly built, would they be better knocked down, as long as the unfortunate buyer can be compensated?
I really hope that the ‘spring clean’, the elections and the bubble bursting can transform the country where it needs it, but without a crystal ball, i wonder if that’s possible or just wishfull thinking?
It’s rumoured that some of the UK based sharks that have been rumbled are indeed setting up in Morocco, and i’m sure other places where they can lie and cheat to a whole new audience, lets hope their new potential victims have good internet access!!
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Casalaloba
Brilliant post and a well deserved beer.
Maximus with regards with the potential problems you refered to as far as I am aware that didnt have seem much effect on London prices so hopefully thats a threat that may go away
Goodstich 44 😀 😯 😯 😯 😯
At last we have someting in common and I agree 100%with what you say as ALL of us want a slice of justice and have anyone involved in the scandle hung out to dry but we just need to consider the other side of the coin even if we choose not to turn it over.
100% agree that I hope the others looking in the new other countries that the sharks are now in have access to the internet so they hopefully will not make the same judgement as us (try not to say mistake)as we called it as we saw it,or thought we saw it?Regards
Jim 😀 😀 😀 -
Casalaloba
Brilliant post and a well deserved beer.
Maximus with regards with the potential problems you refered to as far as I am aware that didnt have seem much effect on London prices so hopefully thats a threat that may go away
Goodstich 44 😀 😯 😯 😯 😯
At last we have someting in common and I agree 100%with what you say as ALL of us want a slice of justice and have anyone involved in the scandle hung out to dry but we just need to consider the other side of the coin even if we choose not to turn it over.
100% agree that I hope the others looking in the new other countries that the sharks are now in have access to the internet so they hopefully will not make the same judgement as us (try not to say mistake)as we called it as we saw it,or thought we saw it?Regards
Jim 😀 😀 😀 -
Jim
as you well know, i have very much looked at/turned over the other side of the coin and it reads pretty much as casalaloba’s post that we both agree on! As for London prices, as with rest of UK, the bad guys, terrorists, fraudsters, cheats etc are as a rule exposed and dealt with where possible and i don’t think run the place to the same extent as some parts of Spain. So i can’t see much changing here with regards to prices, unless a new government gets in and screws up the economy?
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Jim
as you well know, i have very much looked at/turned over the other side of the coin and it reads pretty much as casalaloba’s post that we both agree on! As for London prices, as with rest of UK, the bad guys, terrorists, fraudsters, cheats etc are as a rule exposed and dealt with where possible and i don’t think run the place to the same extent as some parts of Spain. So i can’t see much changing here with regards to prices, unless a new government gets in and screws up the economy?
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@glassman wrote:
Mike
If you had adopted the same attitude over the last 20 years,think you would have missed many boats. 🙁I agree. Which is why I bought in London in 1993. At the time I was paying 100 quid a week to rent a 2 bed apartment and the mortgage on the 2/3 bed house was about 110 a week so it made sense. I was warned at the time not to buy and I had to jump through some hoops with the building society but I just didn’t listen 😉
@glassman wrote:
As Claire has clearly pointed out that one fact cannot be argued in any preditions that firstly you havent lost anything if your not selling and people will pay for something they want.
I don’t really do predictions, I just look at the cost to buy versus the cost to rent. If I was a landlord of the property I mentioned then I would be getting a 2% return on my investment before voids and repairs. I’d rather stick the money in the bank and not have the hassle
@glassman wrote:
Reports this morning that properties in Devon are predicted to go up 17% based on todays infomation,what happens to that report if interest rates go up to 8% tomorrow.?
Which is why I will not buy in Devon either at the moment
@glassman wrote:
Reports are almost always brought together on the data collected at any one time however as history tells us many factors can change situations or we could all read and newspaper reports and based on that we would be millionaires.
Regards
JimYou mean you aren’t a millionaire? I would only buy in Spain if I had so much money that I didn’t care. Until then I will compare the cost to rent with the cost to buy and consider what return I would get on my money as a landlord comparing it with the return I get from either shares or the bank
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@glassman wrote:
Mike
If you had adopted the same attitude over the last 20 years,think you would have missed many boats. 🙁I agree. Which is why I bought in London in 1993. At the time I was paying 100 quid a week to rent a 2 bed apartment and the mortgage on the 2/3 bed house was about 110 a week so it made sense. I was warned at the time not to buy and I had to jump through some hoops with the building society but I just didn’t listen 😉
@glassman wrote:
As Claire has clearly pointed out that one fact cannot be argued in any preditions that firstly you havent lost anything if your not selling and people will pay for something they want.
I don’t really do predictions, I just look at the cost to buy versus the cost to rent. If I was a landlord of the property I mentioned then I would be getting a 2% return on my investment before voids and repairs. I’d rather stick the money in the bank and not have the hassle
@glassman wrote:
Reports this morning that properties in Devon are predicted to go up 17% based on todays infomation,what happens to that report if interest rates go up to 8% tomorrow.?
Which is why I will not buy in Devon either at the moment
@glassman wrote:
Reports are almost always brought together on the data collected at any one time however as history tells us many factors can change situations or we could all read and newspaper reports and based on that we would be millionaires.
Regards
JimYou mean you aren’t a millionaire? I would only buy in Spain if I had so much money that I didn’t care. Until then I will compare the cost to rent with the cost to buy and consider what return I would get on my money as a landlord comparing it with the return I get from either shares or the bank
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@casalaloba wrote:
Morocco is receiving an awful lot of press but with one or two more bombs I wonder how long things will hold up.
@Maximus wrote:
More worryingly, Al Qaeda has said it wants to regain once-Muslim lands like Al-Andalus (Andalucia).
I hate to be the bringer of bad news (I know Jim, does it ever end 😉 ) but am surprised it is not more well-known that many years ago a ‘100 year plan’ was devised by the Islamic extremists, instigated by OBL – Osama. Their aim? To populate Europe and the rest of the world by migration, slowly slowly, with the eventual end game of making the world totally an Islamic State. They truly believe this is God’s will – it was not a joke when it was said their aim is to see the Islamic flag fly over Downing Street.
I lived and worked in the Middle East for over ten years. And even though my many Lebanese, Egyptian and Palestinian friends were far from being extremists, they knew full well about this plan – it was just common knowledge. Fear can have a tremendous impact, and yes – a few bombs in Morocco will certainly concentrate many prospective-buyers’ minds as to whether there is a safe place to invest in. Spain? Well that is certainly a sore point historically-speaking for these extremists, and I was told many years ago by my friends that Andalucia would probably be one of the first European targets in their great plan.
The reason I quoted you above, Casaloba, is that you echo the sentiments of everyone who feels there is a risk in this day and age – and boy, do these people know it. Imagine what effect a few bombs the week before the Seville fiesta would have, for example. People would stay away in their droves.
Through fear and terror, am afraid these people will have their way in the end – and by our politicians losing control of our borders, to be honest, we don’t stand a chance.
@glassman wrote:
…..so hopefully thats a threat that may go away
I’m afraid only in your dreams Jim.
We are probably living in the last peaceful era of our time.How’s that for a weekend debate (‘cos I can’t remember any of my jokes to contribute!)
And all just in my opinion of course……. -
@casalaloba wrote:
Morocco is receiving an awful lot of press but with one or two more bombs I wonder how long things will hold up.
@Maximus wrote:
More worryingly, Al Qaeda has said it wants to regain once-Muslim lands like Al-Andalus (Andalucia).
I hate to be the bringer of bad news (I know Jim, does it ever end 😉 ) but am surprised it is not more well-known that many years ago a ‘100 year plan’ was devised by the Islamic extremists, instigated by OBL – Osama. Their aim? To populate Europe and the rest of the world by migration, slowly slowly, with the eventual end game of making the world totally an Islamic State. They truly believe this is God’s will – it was not a joke when it was said their aim is to see the Islamic flag fly over Downing Street.
I lived and worked in the Middle East for over ten years. And even though my many Lebanese, Egyptian and Palestinian friends were far from being extremists, they knew full well about this plan – it was just common knowledge. Fear can have a tremendous impact, and yes – a few bombs in Morocco will certainly concentrate many prospective-buyers’ minds as to whether there is a safe place to invest in. Spain? Well that is certainly a sore point historically-speaking for these extremists, and I was told many years ago by my friends that Andalucia would probably be one of the first European targets in their great plan.
The reason I quoted you above, Casaloba, is that you echo the sentiments of everyone who feels there is a risk in this day and age – and boy, do these people know it. Imagine what effect a few bombs the week before the Seville fiesta would have, for example. People would stay away in their droves.
Through fear and terror, am afraid these people will have their way in the end – and by our politicians losing control of our borders, to be honest, we don’t stand a chance.
@glassman wrote:
…..so hopefully thats a threat that may go away
I’m afraid only in your dreams Jim.
We are probably living in the last peaceful era of our time.How’s that for a weekend debate (‘cos I can’t remember any of my jokes to contribute!)
And all just in my opinion of course……. -
@Pablo Silver or Lead? wrote:
Almost everyone I know who has bought/invested/sepeculated in Spain and Florida have remortgaged their UK property to put down a 20%+ deposit. Then taken out a mortgage for the balance. This means they effectively are 100% geared/leveraged.
Oh God. If that is as common as you think then it is frightening.
-
@Pablo Silver or Lead? wrote:
Almost everyone I know who has bought/invested/sepeculated in Spain and Florida have remortgaged their UK property to put down a 20%+ deposit. Then taken out a mortgage for the balance. This means they effectively are 100% geared/leveraged.
Oh God. If that is as common as you think then it is frightening.
-
@ralita wrote:
@Ponzi wrote:
For sale. Signed by the author never read (thankfully). 😳
They always put on the cover places who are in recession.
The talked about Florida as a good place to buy 3 month ago, about Dubai 2 months ago.
It seems that they are actually signalling people places where not to buy
Has the Dubai market crashed? I mean, it’s obvious that it’s going to but I hadn’t heard anything yet
-
@ralita wrote:
@Ponzi wrote:
For sale. Signed by the author never read (thankfully). 😳
They always put on the cover places who are in recession.
The talked about Florida as a good place to buy 3 month ago, about Dubai 2 months ago.
It seems that they are actually signalling people places where not to buy
Has the Dubai market crashed? I mean, it’s obvious that it’s going to but I hadn’t heard anything yet
-
-
-
Hear Mr Laden lives in Leicester.
Think we all know and in particular this country what the future may hold regarding terror
The way the world is going everyone may one day be affected but we really do have to carry on (the old bulldog spirit and all that)
Mike ❗
No problem and respect your views and wish in some ways I were as calulating and cautious how ever I am more of a seat of my pants sort that makes mistakes hoewever I thankfully I make more right moves than wrong.
Got a great family,nice house and life is never boring while I am around thats for sure.
Off for a pint have a good weekend.Jim 🙂
-
Hear Mr Laden lives in Leicester.
Think we all know and in particular this country what the future may hold regarding terror
The way the world is going everyone may one day be affected but we really do have to carry on (the old bulldog spirit and all that)
Mike ❗
No problem and respect your views and wish in some ways I were as calulating and cautious how ever I am more of a seat of my pants sort that makes mistakes hoewever I thankfully I make more right moves than wrong.
Got a great family,nice house and life is never boring while I am around thats for sure.
Off for a pint have a good weekend.Jim 🙂
-
@glassman wrote:
Mike ❗
No problem and respect your views and wish in some ways I were as calulating and cautious how ever I am more of a seat of my pants sort that makes mistakes hoewever I thankfully I make more right moves than wrong.
Got a great family,nice house and life is never boring while I am around thats for sure.
Off for a pint have a good weekend.Jim 🙂
Good on you, Jim, happiness is what counts.
But I have to tell you a story about my cautiousness. When I was in Spain I explained to a guy why I wouldn’t buy there and he called me negative. I then explained to the guy that I would invest in shares instead, he replied that I was crazy and I will lose everything!!
So, cautiousness is in the eye of the beholder 😆
-
@glassman wrote:
Mike ❗
No problem and respect your views and wish in some ways I were as calulating and cautious how ever I am more of a seat of my pants sort that makes mistakes hoewever I thankfully I make more right moves than wrong.
Got a great family,nice house and life is never boring while I am around thats for sure.
Off for a pint have a good weekend.Jim 🙂
Good on you, Jim, happiness is what counts.
But I have to tell you a story about my cautiousness. When I was in Spain I explained to a guy why I wouldn’t buy there and he called me negative. I then explained to the guy that I would invest in shares instead, he replied that I was crazy and I will lose everything!!
So, cautiousness is in the eye of the beholder 😆
-
-
-
Claire wrote:[quote=”ralitaQuote:Conclusion: British people need a much better education in economic and, especially, Mathematics.
Ralita, I’m taken aback that you come onto the forum today for the first time and are abusive. Another EA with too much time on their hands ❓ Pathetic! 🙄
What a great logic you have.
Everybody who dislikes stupid Brits with their borrowed money is an EA , right?
I have two friends who are teaching at Univ. in Barcelona and Valencia, they cannot afford to buy anything. Why? because some “investors” came and artificially increased the prices, by using funny money. The only chance for prosessors at Univ. in Spain to buy anything is that these Brits are badly burned and they will need to sell at 50% of the price they paid.
I am keeping my fiongers crossed for that to happen as soon as possible.My prediction: prices in 2012 will be at 70% what they are now in good places and 40% in bad places.
-
Claire wrote:[quote=”ralitaQuote:Conclusion: British people need a much better education in economic and, especially, Mathematics.
Ralita, I’m taken aback that you come onto the forum today for the first time and are abusive. Another EA with too much time on their hands ❓ Pathetic! 🙄
What a great logic you have.
Everybody who dislikes stupid Brits with their borrowed money is an EA , right?
I have two friends who are teaching at Univ. in Barcelona and Valencia, they cannot afford to buy anything. Why? because some “investors” came and artificially increased the prices, by using funny money. The only chance for prosessors at Univ. in Spain to buy anything is that these Brits are badly burned and they will need to sell at 50% of the price they paid.
I am keeping my fiongers crossed for that to happen as soon as possible.My prediction: prices in 2012 will be at 70% what they are now in good places and 40% in bad places.
-
mike wrote:ralita wrote:Ponzi wrote:
For sale. Signed by the author never read (thankfully). 😳
They always put on the cover places who are in recession.
The talked about Florida as a good place to buy 3 month ago, about Dubai 2 months ago.
It seems that they are actually signalling people places where not to buy
Has the Dubai market crashed? I mean, it’s obvious that it’s going to but I hadn’t heard anything yet
they will at the end of 2007 – beggining of 2008.
-
mike wrote:ralita wrote:Ponzi wrote:
For sale. Signed by the author never read (thankfully). 😳
They always put on the cover places who are in recession.
The talked about Florida as a good place to buy 3 month ago, about Dubai 2 months ago.
It seems that they are actually signalling people places where not to buy
Has the Dubai market crashed? I mean, it’s obvious that it’s going to but I hadn’t heard anything yet
they will at the end of 2007 – beggining of 2008.
-
@ralita wrote:
@Claire wrote:
[quote=”ralita
Conclusion: British people need a much better education in economic and, especially, Mathematics.
Ralita, I’m taken aback that you come onto the forum today for the first time and are abusive. Another EA with too much time on their hands ❓ Pathetic! 🙄
What a great logic you have.
Everybody who dislikes stupid Brits with their borrowed money is an EA , right?
I have two friends who are teaching at Univ. in Barcelona and Valencia, they cannot afford to buy anything. Why? because some “investors” came and artificially increased the prices, by using funny money. The only chance for prosessors at Univ. in Spain to buy anything is that these Brits are badly burned and they will need to sell at 50% of the price they paid.
I am keeping my fiongers crossed for that to happen as soon as possible.My prediction: prices in 2012 will be at 70% what they are now in good places and 40% in bad places.
My sincere apologies to some EA’s for putting you in the same category as this pathetic being.
Ralita, “Beware the green-eyed monster“! Instead of blaming other people (British people, no “funny money”…just hard earned money)…blame your own greedy native developers and corrupt government officials 🙄 .
Everybody who dislikes stupid Brits with their borrowed money is an EA , right?
Obviously not! 😆
BUT
The EA’s LOVE the British people with whatever money they have..however they got it. The more the merrier. Therein lies the problem.
-
@ralita wrote:
@Claire wrote:
[quote=”ralita
Conclusion: British people need a much better education in economic and, especially, Mathematics.
Ralita, I’m taken aback that you come onto the forum today for the first time and are abusive. Another EA with too much time on their hands ❓ Pathetic! 🙄
What a great logic you have.
Everybody who dislikes stupid Brits with their borrowed money is an EA , right?
I have two friends who are teaching at Univ. in Barcelona and Valencia, they cannot afford to buy anything. Why? because some “investors” came and artificially increased the prices, by using funny money. The only chance for prosessors at Univ. in Spain to buy anything is that these Brits are badly burned and they will need to sell at 50% of the price they paid.
I am keeping my fiongers crossed for that to happen as soon as possible.My prediction: prices in 2012 will be at 70% what they are now in good places and 40% in bad places.
My sincere apologies to some EA’s for putting you in the same category as this pathetic being.
Ralita, “Beware the green-eyed monster“! Instead of blaming other people (British people, no “funny money”…just hard earned money)…blame your own greedy native developers and corrupt government officials 🙄 .
Everybody who dislikes stupid Brits with their borrowed money is an EA , right?
Obviously not! 😆
BUT
The EA’s LOVE the British people with whatever money they have..however they got it. The more the merrier. Therein lies the problem.
-
Hi Everyone,
Umh! “Stupid Brits with all their borrowed money”. Let’s consider this for a moment.
Without borrowing money 99.9% of people around the globe would not be able to buy a house and most companies would not be able to invest and expand their operations.
It’s not just so called “Stupid Brits” who have bought houses in Spain. What about all the other foreign nationals and lets not forget our cousins across the Irish Sea who have been very big buyers in Spain ( as well as being on the more controversial side of the fence….as sales people).
But most of all, let’s not forget the biggest buyers in Spain. You got it. The Spanish. The Spanish have speculated on property price rises as much as anyone. I know of many locals where I live who have indulged in the ” contract flipping” game.
Greed and fear are universal. They are not the preserve of UK nationals.
And neither is “stupidity”. Markets are driven up by greed and down again by fear and there is a bit of stupidity boyth on the way up and on the way down.Some buyers have undoubtedly overstretched themselves……..not just British ones. Witness all the articles in the Spanish press about over-
indebted households. People who find themselves in that position will suffer but some lucky buyers will pick up properties at greatly reduced prices. A true market in operation.But we also need to consider why prices have increased so much in Spain. Developers build new houses when they perceive a lack of supply.
That’s their business. As demand increases the prices go up. But it’s not just a simple supply/demand issue. One of the key reasons why prices have moved so high here is the scarcity of land with consent to build on. Spain sure as hell is not lacking in land. What it lacks is a coherent planning policy which encompasses all levels of government , from Ayuntamientos, to Diputaciones, to Juntas and up to central government in Madrid. A lot of this has to do with “politics and politicians” pursuing their own and competing agendas. By restricting the supply of land, Developers have to pay more for sites and the price of the finished property goes up.Now, it’s up to us as consumers to decide if we buy at the asking prices. If it’s a second house purchase we have the liberty to take more time about our decision but if it is a “first time/ move up the ladder purchase” and we don’t want to rent/cannot find suitable rental properties, the decision becomes much more pressured and we go to a lending institution to see what funding our earnings can support.
But going back to the issue of second home buyers (whether it be for occupation or investment) we have to accept that the world has changed dramatically in the last 20/30 years. Not many of us have the comfort of a job for life, Gordon Brown has hammered our private pensions with his tax credit raid and people have grown very wary of stockmarkets. Quite naturally many people are looking to provide for themselves in their older years and property is seen as the solution.
It’s a fact of life that the world lives on borrowed money. It’s what keeps
economies going round. Every day it seems that new means of raising money are being introduced. The lending industry is a big part of UK plc/All Developed Countries plc.The introduction of the € has given us transparency in cross border price comparisons but it has fueled a lending boom in much of Europe, most particularly in the Republic of Ireland and Spain. And, with cheap money,
thousands of first and second time buyers have poured into the market.Ralita mentions her friends who cannot buy houses. But to blame “Stupid Brits” for this is just plain wrong. How many nurses,policemen,firemen etc.etc. cannot get onto the property ladder in the UK? And, furthermore, where would the Spanish economy be without the construction industry and all the investment foreign buyers have brought to Spain? I do not hear any builders, bar owners and retailers complaining about “Stupid Brits” here. They love us!
People who have gambled on prices continuing to increase and called it wrong will suffer. But even if some of them have been greedy/naive, I don’t believe anyone deserves to get “rolled over” by lying agents, lawyers,town hall officials,developers et al. It’s surely humbling enough to lose money on an investment when “hindsight” shows you have been a tad over zealous. But being ripped off in the process by a bunch of scumbags is just not right.
If “stupidity is the preserve of us Brits” what is the national/individual trait of people involved in the real estate sector in Spain? Keep it clean please 🙂
Un gran abrazo,
Casa La Loba
-
Hi Everyone,
Umh! “Stupid Brits with all their borrowed money”. Let’s consider this for a moment.
Without borrowing money 99.9% of people around the globe would not be able to buy a house and most companies would not be able to invest and expand their operations.
It’s not just so called “Stupid Brits” who have bought houses in Spain. What about all the other foreign nationals and lets not forget our cousins across the Irish Sea who have been very big buyers in Spain ( as well as being on the more controversial side of the fence….as sales people).
But most of all, let’s not forget the biggest buyers in Spain. You got it. The Spanish. The Spanish have speculated on property price rises as much as anyone. I know of many locals where I live who have indulged in the ” contract flipping” game.
Greed and fear are universal. They are not the preserve of UK nationals.
And neither is “stupidity”. Markets are driven up by greed and down again by fear and there is a bit of stupidity boyth on the way up and on the way down.Some buyers have undoubtedly overstretched themselves……..not just British ones. Witness all the articles in the Spanish press about over-
indebted households. People who find themselves in that position will suffer but some lucky buyers will pick up properties at greatly reduced prices. A true market in operation.But we also need to consider why prices have increased so much in Spain. Developers build new houses when they perceive a lack of supply.
That’s their business. As demand increases the prices go up. But it’s not just a simple supply/demand issue. One of the key reasons why prices have moved so high here is the scarcity of land with consent to build on. Spain sure as hell is not lacking in land. What it lacks is a coherent planning policy which encompasses all levels of government , from Ayuntamientos, to Diputaciones, to Juntas and up to central government in Madrid. A lot of this has to do with “politics and politicians” pursuing their own and competing agendas. By restricting the supply of land, Developers have to pay more for sites and the price of the finished property goes up.Now, it’s up to us as consumers to decide if we buy at the asking prices. If it’s a second house purchase we have the liberty to take more time about our decision but if it is a “first time/ move up the ladder purchase” and we don’t want to rent/cannot find suitable rental properties, the decision becomes much more pressured and we go to a lending institution to see what funding our earnings can support.
But going back to the issue of second home buyers (whether it be for occupation or investment) we have to accept that the world has changed dramatically in the last 20/30 years. Not many of us have the comfort of a job for life, Gordon Brown has hammered our private pensions with his tax credit raid and people have grown very wary of stockmarkets. Quite naturally many people are looking to provide for themselves in their older years and property is seen as the solution.
It’s a fact of life that the world lives on borrowed money. It’s what keeps
economies going round. Every day it seems that new means of raising money are being introduced. The lending industry is a big part of UK plc/All Developed Countries plc.The introduction of the € has given us transparency in cross border price comparisons but it has fueled a lending boom in much of Europe, most particularly in the Republic of Ireland and Spain. And, with cheap money,
thousands of first and second time buyers have poured into the market.Ralita mentions her friends who cannot buy houses. But to blame “Stupid Brits” for this is just plain wrong. How many nurses,policemen,firemen etc.etc. cannot get onto the property ladder in the UK? And, furthermore, where would the Spanish economy be without the construction industry and all the investment foreign buyers have brought to Spain? I do not hear any builders, bar owners and retailers complaining about “Stupid Brits” here. They love us!
People who have gambled on prices continuing to increase and called it wrong will suffer. But even if some of them have been greedy/naive, I don’t believe anyone deserves to get “rolled over” by lying agents, lawyers,town hall officials,developers et al. It’s surely humbling enough to lose money on an investment when “hindsight” shows you have been a tad over zealous. But being ripped off in the process by a bunch of scumbags is just not right.
If “stupidity is the preserve of us Brits” what is the national/individual trait of people involved in the real estate sector in Spain? Keep it clean please 🙂
Un gran abrazo,
Casa La Loba
-
Claire wrote:ralita wrote:Claire wrote:[quote=”ralitaQuote:Conclusion: British people need a much better education in economic and, especially, Mathematics.
Ralita, I’m taken aback that you come onto the forum today for the first time and are abusive. Another EA with too much time on their hands ❓ Pathetic! 🙄
What a great logic you have.
Everybody who dislikes stupid Brits with their borrowed money is an EA , right?
I have two friends who are teaching at Univ. in Barcelona and Valencia, they cannot afford to buy anything. Why? because some “investors” came and artificially increased the prices, by using funny money. The only chance for prosessors at Univ. in Spain to buy anything is that these Brits are badly burned and they will need to sell at 50% of the price they paid.
I am keeping my fiongers crossed for that to happen as soon as possible.My prediction: prices in 2012 will be at 70% what they are now in good places and 40% in bad places.
My sincere apologies to some EA’s for putting you in the same category as this pathetic being.
Ralita, “Beware the green-eyed monster“! Instead of blaming other people (British people, no “funny money”…just hard earned money)…blame your own greedy native developers and corrupt government officials 🙄 .
Quote:Everybody who dislikes stupid Brits with their borrowed money is an EA , right?Obviously not! 😆
BUT
The EA’s LOVE the British people with whatever money they have..however they got it. The more the merrier. Therein lies the problem.
I am not Spanish but I know many of my friends in Spauin cannot even go close to properties because their prices are so much over-inflated…
And sorry, not only Brits were with money, also Irish, Dutch and other Nordic coutries.
The problem is that the easy money is the most readily available in UK.
I give one example: Cape Verde. The italians and spaniards have run a wild speculation for about 10 years. Then they got stuck as nobody was willing to pay more. Then Brits got in and the speculation continues.I know the same story in Fuerteventura where the Germans were inflating the prices till they reached a peak. Then Fuerteventura was heavily
advertised in UK and Brits replaced Germans.I do not know the story in mainland Spain but I am sure it was the same.
Does anybody know any place where Brits were first and the came the others (Germans, Italians, etc)? -
Claire wrote:ralita wrote:Claire wrote:[quote=”ralitaQuote:Conclusion: British people need a much better education in economic and, especially, Mathematics.
Ralita, I’m taken aback that you come onto the forum today for the first time and are abusive. Another EA with too much time on their hands ❓ Pathetic! 🙄
What a great logic you have.
Everybody who dislikes stupid Brits with their borrowed money is an EA , right?
I have two friends who are teaching at Univ. in Barcelona and Valencia, they cannot afford to buy anything. Why? because some “investors” came and artificially increased the prices, by using funny money. The only chance for prosessors at Univ. in Spain to buy anything is that these Brits are badly burned and they will need to sell at 50% of the price they paid.
I am keeping my fiongers crossed for that to happen as soon as possible.My prediction: prices in 2012 will be at 70% what they are now in good places and 40% in bad places.
My sincere apologies to some EA’s for putting you in the same category as this pathetic being.
Ralita, “Beware the green-eyed monster“! Instead of blaming other people (British people, no “funny money”…just hard earned money)…blame your own greedy native developers and corrupt government officials 🙄 .
Quote:Everybody who dislikes stupid Brits with their borrowed money is an EA , right?Obviously not! 😆
BUT
The EA’s LOVE the British people with whatever money they have..however they got it. The more the merrier. Therein lies the problem.
I am not Spanish but I know many of my friends in Spauin cannot even go close to properties because their prices are so much over-inflated…
And sorry, not only Brits were with money, also Irish, Dutch and other Nordic coutries.
The problem is that the easy money is the most readily available in UK.
I give one example: Cape Verde. The italians and spaniards have run a wild speculation for about 10 years. Then they got stuck as nobody was willing to pay more. Then Brits got in and the speculation continues.I know the same story in Fuerteventura where the Germans were inflating the prices till they reached a peak. Then Fuerteventura was heavily
advertised in UK and Brits replaced Germans.I do not know the story in mainland Spain but I am sure it was the same.
Does anybody know any place where Brits were first and the came the others (Germans, Italians, etc)? -
Does it matter? Spain is what it is. It’s the same in the UK for young people. Unless they can get parental help or share buying with maybe one or two more people, they cannot afford to buy because investors snap up new and older 1/2 bedroom apartments or first time buyers houses for buy-to-let. I think this applies in many areas of Europe.
I do not know the story in mainland Spain but I am sure it was the same.
Ralita, if you don’t know the story then don’t accuse.
-
Does it matter? Spain is what it is. It’s the same in the UK for young people. Unless they can get parental help or share buying with maybe one or two more people, they cannot afford to buy because investors snap up new and older 1/2 bedroom apartments or first time buyers houses for buy-to-let. I think this applies in many areas of Europe.
I do not know the story in mainland Spain but I am sure it was the same.
Ralita, if you don’t know the story then don’t accuse.
-
Claire wrote:Does it matter? Spain is what it is. It’s the same in the UK for young people. Unless they can get parental help or share buying with maybe one or two more people, they cannot afford to buy because investors snap up new and older 1/2 bedroom apartments or first time buyers houses for buy-to-let. I think this applies in many areas of Europe.
And this is why the mother of all house price crashes is now underway.
USA is first, Spanish now leads the second pack and UK will follow sometimes soon enough.One can only sit and enjoy the show (unless badly fried).
-
Claire wrote:Does it matter? Spain is what it is. It’s the same in the UK for young people. Unless they can get parental help or share buying with maybe one or two more people, they cannot afford to buy because investors snap up new and older 1/2 bedroom apartments or first time buyers houses for buy-to-let. I think this applies in many areas of Europe.
And this is why the mother of all house price crashes is now underway.
USA is first, Spanish now leads the second pack and UK will follow sometimes soon enough.One can only sit and enjoy the show (unless badly fried).
-
What an obnoxious person you are, xenaphobia springs to mind. Do you know that spains GDP is almost entirely based on construction? Gleefully hoping for a crash just to get at a few foreigners is reflected in an English saying “Burning down your own house to get rid of a rat” and as for “funny money” didn’t spain invent the phrase “black money” ❓
-
What an obnoxious person you are, xenaphobia springs to mind. Do you know that spains GDP is almost entirely based on construction? Gleefully hoping for a crash just to get at a few foreigners is reflected in an English saying “Burning down your own house to get rid of a rat” and as for “funny money” didn’t spain invent the phrase “black money” ❓
-
Hi Again Everyone,
Ralita did you read my post earlier this pm? I’m not sure I get the drift of your argument apart from ranting on about Brits being the source of all evil.
Hey, I’d like to live in Utopia too, where we all have jobs for life, a gold watch on retirement, a secure pension and a holiday house in the sun. A world where prices never go up,everything stays the same, the sun shines most days and it rains enough to keep the farmers happy. Now wouldn’t that be just wonderful? Sounds like my idea of hell.
The real world is a little different. Tourism is the biggest industry in the world and everyone from the Cap Verde Islands to Brazil wants a slice of the cake. Nothing wrong with that.
You portray the Brits in a pretty horrible light. Are we reponsible for all the wrongs in the world? I have no idea where you are from but it sounds as if you’d like us all to pack our bags and head back to blighty. That way, the natives in the rest of the world could continue with their lifes of “rustic ideal”,untroubled by property hungry Brits inflating the price of everything.
Well you are wrong. We didn’t put up the price of a coffee from 100 pesetas to a 166.368 pesetas. But the introduction of the € did.
And as for your assertion that “the mother of all house price crashes is on”, the facts do not bear this out. No-one is denying that by historical standards house prices are out of kilter with earnings and there will be a correction . But I believe it is over the top to express yourself in such dramatic terms.
But I have an idea for you. What if the Brits sell up in all the countries they have bought in and then you’ll see the mother of all crashes. Somehow, I do not think the Spanish etc want us all to leave.
Saludos,
Casa La Loba
-
Hi Again Everyone,
Ralita did you read my post earlier this pm? I’m not sure I get the drift of your argument apart from ranting on about Brits being the source of all evil.
Hey, I’d like to live in Utopia too, where we all have jobs for life, a gold watch on retirement, a secure pension and a holiday house in the sun. A world where prices never go up,everything stays the same, the sun shines most days and it rains enough to keep the farmers happy. Now wouldn’t that be just wonderful? Sounds like my idea of hell.
The real world is a little different. Tourism is the biggest industry in the world and everyone from the Cap Verde Islands to Brazil wants a slice of the cake. Nothing wrong with that.
You portray the Brits in a pretty horrible light. Are we reponsible for all the wrongs in the world? I have no idea where you are from but it sounds as if you’d like us all to pack our bags and head back to blighty. That way, the natives in the rest of the world could continue with their lifes of “rustic ideal”,untroubled by property hungry Brits inflating the price of everything.
Well you are wrong. We didn’t put up the price of a coffee from 100 pesetas to a 166.368 pesetas. But the introduction of the € did.
And as for your assertion that “the mother of all house price crashes is on”, the facts do not bear this out. No-one is denying that by historical standards house prices are out of kilter with earnings and there will be a correction . But I believe it is over the top to express yourself in such dramatic terms.
But I have an idea for you. What if the Brits sell up in all the countries they have bought in and then you’ll see the mother of all crashes. Somehow, I do not think the Spanish etc want us all to leave.
Saludos,
Casa La Loba
-
katy wrote:What an obnoxious person you are, xenaphobia springs to mind. Do you know that spains GDP is almost entirely based on construction? Gleefully hoping for a crash just to get at a few foreigners is reflected in an English saying “Burning down your own house to get rid of a rat” and as for “funny money” didn’t spain invent the phrase “black money” ❓
You have no idea what is going to hit you. Spain will of course crash, there is no way you can base your economy on bubbles and survive to tell it. Bankks will carsh, builders will go bankrupt.
Anyway, walk your dogs and be happy, it is only money afterwards.
-
katy wrote:What an obnoxious person you are, xenaphobia springs to mind. Do you know that spains GDP is almost entirely based on construction? Gleefully hoping for a crash just to get at a few foreigners is reflected in an English saying “Burning down your own house to get rid of a rat” and as for “funny money” didn’t spain invent the phrase “black money” ❓
You have no idea what is going to hit you. Spain will of course crash, there is no way you can base your economy on bubbles and survive to tell it. Bankks will carsh, builders will go bankrupt.
Anyway, walk your dogs and be happy, it is only money afterwards.
-
casalaloba wrote:You portray the Brits in a pretty horrible light. Are we reponsible for all the wrongs in the world? I have no idea where you are from but it sounds as if you’d like us all to pack our bags and head back to blighty. That way, the natives in the rest of the world could continue with their lifes of “rustic ideal”,untroubled by property hungry Brits inflating the price of everything.
And as for your assertion that “the mother of all house price crashes is on”, the facts do not bear this out. No-one is denying that by historical standards house prices are out of kilter with earnings and there will be a correction . But I believe it is over the top to express yourself in such dramatic terms.But I have an idea for you. What if the Brits sell up in all the countries they have bought in and then you’ll see the mother of all crashes. Somehow, I do not think the Spanish etc want us all to leave.
Last time, I explain:
1) many Brits wanted a piece of cake. The first ones were smart and got some money. The last ones are holding theb bags and will get fried.
2) banks offered funny money to everybody who applied.
3) people did not understand that the rates can go up if Euribor goes up
I could not care less about Brits. I have to live among them as my job is better paid here than somewhere else. I can also observe the complete lack of financial and mathematics knowledge among the general people.
Anyway, some you are in the first stages of a crash called DENIAL.
But it’s OK, most of the people are. I guess only in Florida the DESPERATION stage has been reached and prices fall like a rock. -
casalaloba wrote:You portray the Brits in a pretty horrible light. Are we reponsible for all the wrongs in the world? I have no idea where you are from but it sounds as if you’d like us all to pack our bags and head back to blighty. That way, the natives in the rest of the world could continue with their lifes of “rustic ideal”,untroubled by property hungry Brits inflating the price of everything.
And as for your assertion that “the mother of all house price crashes is on”, the facts do not bear this out. No-one is denying that by historical standards house prices are out of kilter with earnings and there will be a correction . But I believe it is over the top to express yourself in such dramatic terms.But I have an idea for you. What if the Brits sell up in all the countries they have bought in and then you’ll see the mother of all crashes. Somehow, I do not think the Spanish etc want us all to leave.
Last time, I explain:
1) many Brits wanted a piece of cake. The first ones were smart and got some money. The last ones are holding theb bags and will get fried.
2) banks offered funny money to everybody who applied.
3) people did not understand that the rates can go up if Euribor goes up
I could not care less about Brits. I have to live among them as my job is better paid here than somewhere else. I can also observe the complete lack of financial and mathematics knowledge among the general people.
Anyway, some you are in the first stages of a crash called DENIAL.
But it’s OK, most of the people are. I guess only in Florida the DESPERATION stage has been reached and prices fall like a rock. -
Hi all
I’ve not made many posts of late but you can be sure I’ve been reading them 🙂
This thread, as usual, has descended in to name calling (nothing new there then), but i feel compelled to say a couple of words.
I don’t care if the housing market in Spain is in meltdown, the reason is like thousands of others from the UK, Ireland, etc. we bought a place which we could afford in a nice area on the CDS and we have used and intend to use it for the next ten years or so. As for value it is more pleasant and offers greater value for our family, than renting / taking package holidays etc.
Surly only those who wish to sell should care about this so called meltdown in the CURRENT property values. It must also be good news for those who like me, and thousands of others, want a holiday home in a nice country, where you are made welcome, the food is great, they love kids, kids clothes are cheap, oh and by the way, the sun shine a lot as well!
If anyone would like me to point them to similar predicted meltdowns of property prices in the UK (predictions made over the last five years or so) i would point them to google.co.uk and search the news section.
Regards
Paul
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Hi all
I’ve not made many posts of late but you can be sure I’ve been reading them 🙂
This thread, as usual, has descended in to name calling (nothing new there then), but i feel compelled to say a couple of words.
I don’t care if the housing market in Spain is in meltdown, the reason is like thousands of others from the UK, Ireland, etc. we bought a place which we could afford in a nice area on the CDS and we have used and intend to use it for the next ten years or so. As for value it is more pleasant and offers greater value for our family, than renting / taking package holidays etc.
Surly only those who wish to sell should care about this so called meltdown in the CURRENT property values. It must also be good news for those who like me, and thousands of others, want a holiday home in a nice country, where you are made welcome, the food is great, they love kids, kids clothes are cheap, oh and by the way, the sun shine a lot as well!
If anyone would like me to point them to similar predicted meltdowns of property prices in the UK (predictions made over the last five years or so) i would point them to google.co.uk and search the news section.
Regards
Paul
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Ralita said “Banks will crash, builders will go bankrupt” sounds like good news to me. I just live in my house and walk my dogs and generally enjoy myself. Quite frankly Ralita, I think you are bonkers won’t bother joining in your rants again. Suppose we have to get a nutter now and then though it is the internet 🙄
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Ralita said “Banks will crash, builders will go bankrupt” sounds like good news to me. I just live in my house and walk my dogs and generally enjoy myself. Quite frankly Ralita, I think you are bonkers won’t bother joining in your rants again. Suppose we have to get a nutter now and then though it is the internet 🙄
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I agree 100% with you Katy. My stance too.
I agree with you too, Paul. The long term people who bought for holidays, retirement or to move permanently to Spain need not worry too much. Those who bought purely to make an easy & fast buck who need to sell sooner rather than later will probably be very concerned at the market conditions now.
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I agree 100% with you Katy. My stance too.
I agree with you too, Paul. The long term people who bought for holidays, retirement or to move permanently to Spain need not worry too much. Those who bought purely to make an easy & fast buck who need to sell sooner rather than later will probably be very concerned at the market conditions now.
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@ralita wrote:
I have two friends who are teaching at Univ. in Barcelona and Valencia, they cannot afford to buy anything. Why? because some “investors” came and artificially increased the prices, by using funny money.
About 20 years ago, a friend of mine spent a year at the Uni. in Valencia.
She stayed with a teacher at the university (in his mid 30’s) who was still living with his Mum at her little apartment. He and many of his fellow teachers used to complain back then about not being able to afford a place of their own – but their gripe was not towards the ‘stupid British’. They firmly put the blame on their low salary and lack of social housing, and suspect these reasons are the real truth today. In fact they loved the presence of the Brits., they were a source of almost doubling their salary by wanting private Spanish lessons. These teachers have remained friends to this day and love the ‘international’ flavour of their ever-growing city.Ralita – you say you are not Spanish, so I hope that your rudeness towards the British and total ignorance of anything factual is not misunderstood to be representative of the Spanish attitude in general. Millions of Spanish families and their businesses have benefited and prospered through foreigners settling in Spain as casaloba quite rightly pointed out.
From your posts, I gather you live and work in Spain as a foreigner yourself. I wonder just how much your rantings are based on your own personal grievances that you yourself perhaps can’t afford anywhere to buy?
And as far as the ‘stupid Brits’ needing educating in economics and mathematics – may I suggest you undertake a course yourself…. in basic courtesy and good manners.
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@ralita wrote:
I have two friends who are teaching at Univ. in Barcelona and Valencia, they cannot afford to buy anything. Why? because some “investors” came and artificially increased the prices, by using funny money.
About 20 years ago, a friend of mine spent a year at the Uni. in Valencia.
She stayed with a teacher at the university (in his mid 30’s) who was still living with his Mum at her little apartment. He and many of his fellow teachers used to complain back then about not being able to afford a place of their own – but their gripe was not towards the ‘stupid British’. They firmly put the blame on their low salary and lack of social housing, and suspect these reasons are the real truth today. In fact they loved the presence of the Brits., they were a source of almost doubling their salary by wanting private Spanish lessons. These teachers have remained friends to this day and love the ‘international’ flavour of their ever-growing city.Ralita – you say you are not Spanish, so I hope that your rudeness towards the British and total ignorance of anything factual is not misunderstood to be representative of the Spanish attitude in general. Millions of Spanish families and their businesses have benefited and prospered through foreigners settling in Spain as casaloba quite rightly pointed out.
From your posts, I gather you live and work in Spain as a foreigner yourself. I wonder just how much your rantings are based on your own personal grievances that you yourself perhaps can’t afford anywhere to buy?
And as far as the ‘stupid Brits’ needing educating in economics and mathematics – may I suggest you undertake a course yourself…. in basic courtesy and good manners.
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katy wrote:Ralita said “Banks will crash, builders will go bankrupt” sounds like good news to me. I just live in my house and walk my dogs and generally enjoy myself.
Well, if you only walk the dogs, then why bother with the economic situations? The dogs are going to be walked in a downturn and upturn.
Do you also wash the dishes at home?
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katy wrote:Ralita said “Banks will crash, builders will go bankrupt” sounds like good news to me. I just live in my house and walk my dogs and generally enjoy myself.
Well, if you only walk the dogs, then why bother with the economic situations? The dogs are going to be walked in a downturn and upturn.
Do you also wash the dishes at home?
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Morning everyone,
I can’t resist starting the day with a little jibe about “Ralita”. I am curious as to the background of Ralitas pseudonym. Could it by any chance be derived from the French verb Raler (missing a hat on the e!). If so, that would be most appropriate as Raler means to grumble,moan about something,be furious… I have no idea if Ralita is an amigo or an amiga, but in French he/she would be “Un Raleur or Une Raleuse”. Fascinating stuff for a Monday morning ;-). And before anyone asks, I identify myself as Casa La Loba because that’s the name of my house and business.
Un abrazo,
Casa La Loba
PS There is a good piece in the Daily Telegraph today by Liam Halligan about the market here. I agree with him . I think it’s a case of “Tranquilo Hombre!”
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Morning everyone,
I can’t resist starting the day with a little jibe about “Ralita”. I am curious as to the background of Ralitas pseudonym. Could it by any chance be derived from the French verb Raler (missing a hat on the e!). If so, that would be most appropriate as Raler means to grumble,moan about something,be furious… I have no idea if Ralita is an amigo or an amiga, but in French he/she would be “Un Raleur or Une Raleuse”. Fascinating stuff for a Monday morning ;-). And before anyone asks, I identify myself as Casa La Loba because that’s the name of my house and business.
Un abrazo,
Casa La Loba
PS There is a good piece in the Daily Telegraph today by Liam Halligan about the market here. I agree with him . I think it’s a case of “Tranquilo Hombre!”
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I was very relieved to hear that ralita is not Spanish as the Spanish people I meet in day to day life, whilst there, are friendly and courteous. We are never made to feel as being “The enemy within”!
There were two sizable articles on the Spanish economy/property market in The Sunday Times yesterday. On the front page Mark was quoted again and SPI was mentioned as a website to go to for Spanish property problems. I guess we can expect some more disgruntled visitors in the days ahead. 😉
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I was very relieved to hear that ralita is not Spanish as the Spanish people I meet in day to day life, whilst there, are friendly and courteous. We are never made to feel as being “The enemy within”!
There were two sizable articles on the Spanish economy/property market in The Sunday Times yesterday. On the front page Mark was quoted again and SPI was mentioned as a website to go to for Spanish property problems. I guess we can expect some more disgruntled visitors in the days ahead. 😉
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@ralita wrote:
I give one example: Cape Verde.
I don’t know how you format your replies, Ralita but you do it badly making your posts difficult to follow. Please don’t take that the wrong way, it’s an observation rather than a criticism.
However, I did pick up on the Cape Verde comment. Now, is that a small island off Africa which it takes two days to get to from Britain? I was quite bemused when I heard that some people were considering investing there. Have you got any details? Crazy prices?
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@ralita wrote:
I give one example: Cape Verde.
I don’t know how you format your replies, Ralita but you do it badly making your posts difficult to follow. Please don’t take that the wrong way, it’s an observation rather than a criticism.
However, I did pick up on the Cape Verde comment. Now, is that a small island off Africa which it takes two days to get to from Britain? I was quite bemused when I heard that some people were considering investing there. Have you got any details? Crazy prices?
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@katy wrote:
What an obnoxious person you are, xenaphobia springs to mind. Do you know that spains GDP is almost entirely based on construction? Gleefully hoping for a crash just to get at a few foreigners is reflected in an English saying “Burning down your own house to get rid of a rat” and as for “funny money” didn’t spain invent the phrase “black money” ❓
Looking beyond any accusations of xenophobia, do you think there may be a reason why the Brits are so fond of property? I’m thinking the Thatcher revolution and selling off council property. Apart from the early 90s, which could be described as a blip, property has been very good to the British and even with a correction is likely to be a very good long term hold.
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@katy wrote:
What an obnoxious person you are, xenaphobia springs to mind. Do you know that spains GDP is almost entirely based on construction? Gleefully hoping for a crash just to get at a few foreigners is reflected in an English saying “Burning down your own house to get rid of a rat” and as for “funny money” didn’t spain invent the phrase “black money” ❓
Looking beyond any accusations of xenophobia, do you think there may be a reason why the Brits are so fond of property? I’m thinking the Thatcher revolution and selling off council property. Apart from the early 90s, which could be described as a blip, property has been very good to the British and even with a correction is likely to be a very good long term hold.
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@Claire wrote:
[quote=”mike
Looking beyond any accusations of xenophobia, do you think there may be a reason why the Brits are so fond of property?
😮
What a bizarre question!
I found that unnecessarily rude, Claire, but to clarify.
Did any other country sell off its social housing to the extent that the British did in the early 80s? Is there any other country with a working class so property rich? In most cases the mortgage they had to take out in order to buy their property was less than they were paying in rent previous to buying.
Now, can you see that there is a point in there? Did the same thing happen in any other country? Experiences like that will shape opinion. Being surrounded by others who have been successful in property ownership reinforces that belief.
It might result in a person becoming complacent. It might lead to such a person investing in another country in which the market is not so heavily regulated, in which solicitors happily collude with developers, it might lead them to ignore that most of the local politicians are in prison due to corruption associated with property. Don’t get me started on the spivs patroling towns looking for speculators, estate agents taking outrageous amounts in commission, notaries turning a blind eye as black money changes hands and locals doubling the price when they think that a Brit might be interested.
All in all it’s not good, is it? And your response in trying to understand what’s happened and where certain people may have made a mistake is to try to nip in the bud any attempt to try to understand it except from a very two dimensional perspective. God help us.
The only remaining factor I left off my list is stupid investors who don’t really think too much about what they are doing because if everyone else is doing it, it must be right!
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@Claire wrote:
[quote=”mike
Looking beyond any accusations of xenophobia, do you think there may be a reason why the Brits are so fond of property?
😮
What a bizarre question!
I found that unnecessarily rude, Claire, but to clarify.
Did any other country sell off its social housing to the extent that the British did in the early 80s? Is there any other country with a working class so property rich? In most cases the mortgage they had to take out in order to buy their property was less than they were paying in rent previous to buying.
Now, can you see that there is a point in there? Did the same thing happen in any other country? Experiences like that will shape opinion. Being surrounded by others who have been successful in property ownership reinforces that belief.
It might result in a person becoming complacent. It might lead to such a person investing in another country in which the market is not so heavily regulated, in which solicitors happily collude with developers, it might lead them to ignore that most of the local politicians are in prison due to corruption associated with property. Don’t get me started on the spivs patroling towns looking for speculators, estate agents taking outrageous amounts in commission, notaries turning a blind eye as black money changes hands and locals doubling the price when they think that a Brit might be interested.
All in all it’s not good, is it? And your response in trying to understand what’s happened and where certain people may have made a mistake is to try to nip in the bud any attempt to try to understand it except from a very two dimensional perspective. God help us.
The only remaining factor I left off my list is stupid investors who don’t really think too much about what they are doing because if everyone else is doing it, it must be right!
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Hi mg,
We don’t really have any other choice other than ‘loving’ property – our market is not geared up for long term renting. It could also be argued that because we have residual value in our houses we are able to borrow money from banks in order to start up business’. Individuals from former State Socialist countries did not own their houses so had difficulty borrowing and hence those countries found it difficult moving towards capitalism. (Almost sounds I know what I’m banging on about! ).
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Hi mg,
We don’t really have any other choice other than ‘loving’ property – our market is not geared up for long term renting. It could also be argued that because we have residual value in our houses we are able to borrow money from banks in order to start up business’. Individuals from former State Socialist countries did not own their houses so had difficulty borrowing and hence those countries found it difficult moving towards capitalism. (Almost sounds I know what I’m banging on about! ).
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@mg wrote:
“Looking beyond any accusations of xenophobia, do you think there may be a reason why the Brits are so fond of property?”
Before the time you mention, Brits would look on a house as a home, now many see it as a way of making money without having to work for it!!!!!!
Until things go wrong that is.Thanks, mg. I seem to remember that we learned that lesson in the early 90s but we may have forgotten it in all the recent hysteria. Looking on the bright side, we got through that period and a lot of us prospered thanks to housing.
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@mg wrote:
“Looking beyond any accusations of xenophobia, do you think there may be a reason why the Brits are so fond of property?”
Before the time you mention, Brits would look on a house as a home, now many see it as a way of making money without having to work for it!!!!!!
Until things go wrong that is.Thanks, mg. I seem to remember that we learned that lesson in the early 90s but we may have forgotten it in all the recent hysteria. Looking on the bright side, we got through that period and a lot of us prospered thanks to housing.
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goodstich44 said
” many see it as a way of making money without having to work for it!!!!!! ‘
……..not that agents, lawyers, developers do this of course, all honest hard working as we all know!”Personally, I couldn’t care who the hell does it, or what they are. You may choose to do it.
I was responding to a question. -
goodstich44 said
” many see it as a way of making money without having to work for it!!!!!! ‘
……..not that agents, lawyers, developers do this of course, all honest hard working as we all know!”Personally, I couldn’t care who the hell does it, or what they are. You may choose to do it.
I was responding to a question. -
“Thanks, mg. I seem to remember that we learned that lesson in the early 90s but we may have forgotten it in all the recent hysteria. Looking on the bright side, we got through that period and a lot of us prospered thanks to housing.”
Yeah, as long as people have learned, it should reduce the problem
Today’s problem is that so called investors have not experienced a downturn before, as the market has been good for a generation, so they are unaware as what needs to be done to survive. -
“Thanks, mg. I seem to remember that we learned that lesson in the early 90s but we may have forgotten it in all the recent hysteria. Looking on the bright side, we got through that period and a lot of us prospered thanks to housing.”
Yeah, as long as people have learned, it should reduce the problem
Today’s problem is that so called investors have not experienced a downturn before, as the market has been good for a generation, so they are unaware as what needs to be done to survive. -
An English or Spanish persons home is their castle, and why wouldn’t they have a love affair with it? In the last 20-30 years, what has even come close as a relable investment, even allowing for blips?
If corruption, lies, fraud etc at all levels wasn’t almost ‘the norm’ in Spain, i don’t see why it would be any different? I’m sure even naive investors accept market conditions, but what’s going on in Spain, just defies belief!
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An English or Spanish persons home is their castle, and why wouldn’t they have a love affair with it? In the last 20-30 years, what has even come close as a relable investment, even allowing for blips?
If corruption, lies, fraud etc at all levels wasn’t almost ‘the norm’ in Spain, i don’t see why it would be any different? I’m sure even naive investors accept market conditions, but what’s going on in Spain, just defies belief!
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Property obsession, ‘a very British disease’
Over the last twenty years or so we Brits have become ever more obsessed with property and the price of it. This obsession seems to be deeply rooted in our national psyche, unlike say the French, Italians or Germans. On occasions this can lead to greed suppressing other emotions such as fear and lead us to being less cautious, than otherwise might be advisable.
Considering buying a holiday home (especially abroad), note to self, Engage Brain!
On the other hand when buying an investment ‘property’ (as opposed to a home), we are unencumbered by all the emotional baggage and distractions that’s attached to our home. We can be hard headed as we run the numbers and negotiate wearing our best poker face. The only considerations when looking at a buy to let are cold unemotional business ones. Such as is the property good value relative to the market, on a like for like basis? Is the area up and coming and how is that likely to impact capital appreciation? How easy will it be to rent and what is the yield (all costs in)? What are the total costs of buying/owning, mortgage, insurance, re-decoration/repairs and professional fees etc? How does the current tax environment affect my potential returns? Of course none of this is rocket science, just good old common sense.
If the saying ‘that the first casualty of war is the truth’ is a truism, then ‘the first casualty of buying a holiday home is often basic common sense’.
We are a nation seemingly obsessed with property and property prices. Witness the rash of TV programs imploring us to relocate, trade up, buy to let and do up to sell. In the five last five years property prices in Britain have increased dramatically and a whole industry has sprung up encouraging us to release equity and buy abroad. The vested interests (VI) such as the Developers, Estate Agents and Banks/Building Societies are ably assisted by the ‘Lifestyle Media’, in marketing the dream.
So what happens when we get into the process of buying a holiday property? Is it a home or an investment? It’s not really a home, or more correctly our home, as we don’t live there, we just visit occasionally. However due to the cost and commitment of owning a holiday property, we have to view it in investment terms. On the other hand we shouldn’t view holiday properties purely as an investment though, as we are going to spend a fair proportion of our limited but highly valued, family holiday time there. So a holiday property is neither a family home in the true sense, or a pure investment, only to be judged on the financials. A second property bought as a holiday retreat is in reality a bit of both. A home away from home and part of our long term investment strategy, in other words, a compromise! There is no doubt in my mind when we’re buying a holiday property, the line between emotional ‘home buying’ and hard headed ‘investment analysis’ becomes blurred. The former always triumphs over the latter as we metaphorically chase our rose tinted dream and in some cases, rose gardened cottage.
Once we’ve found a holiday property, the contracts have been exchanged and our Solicitor rings to say we’ve completed, the honeymoon period appears all too brief. Previously caught up in the full flush and thrill of the chase, bask awhile in the afterglow, for it does not last long. The fact that we may have let our heart rule, in the run up to buying our holiday property, soon becomes apparent with the arrival of the first set of bills. Mortgage, insurance, council tax, utilities, appliances, furnishings, service charges, the list is almost endless. Having let our heart rule up to now, we re-engage our heads and focus on the investment side of the equation.
The dying embers of the honeymoon period are finally extinguished when a sober assessment of the business case you put together on the back of a napkin in a beer garden/tapas bar, doesn’t now seem quite so robust. Of course It’s human nature that if we really want something we tend to emphasise the positives. This is to convince those around us and indeed ourselves that we’re doing the right thing, for the right reasons. It is easy to play down any negatives that don’t help support your case. If you want to be convinced of something, you can be pretty persuasive.
We generally underestimate the costs that go along with ownership of a holiday home and if we intend to rent it out, over estimate the revenue. Estate Agents and Developers Sales staff can play a big part in this. Ask them questions about running costs and rather than be evasive, they will tell you exactly what you want to hear. The only lies they tell, may be by omission but they will spin everything their way. Ask them about income from both long and short term lets and they will be bullish, confirming your own thoughts. Beware of sales people bearing good news. Do not take anything you’re told at face value, cross check and always test assumptions (especially your own). The key rules of the property buying game you need to remember are, firstly Caveat Emptor or Buyer Beware! The second rule is if the deal seems too good to be true it usually is and the third and final rule is, ensure you take independent ‘subject matter expert’ advice on legal, value/survey and financial matters. Both Estate Agents and Developers will offer you a ‘one stop shop’, for a property, legal work, survey and mortgage. It’s too cosy and they will all have a vested financial interest in you buying and therefore perhaps not be as diligent as you my like.
If we intend to rent out the property, especially on short term holiday lets of a week or two, its easy to grossly underestimate the costs. These costs come in the form of our time and the direct costs associated with the property being used on a short term, high turnover basis.
Mad dogs and Englishmen
There’s no doubt that buying and selling property in the UK can be a minefield, especially for the uninitiated or inexperienced. However that pals into insignificance when you consider the additional pitfalls that can await us in buying abroad as many are now finding out.
Pablo Silver or Lead?
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Property obsession, ‘a very British disease’
Over the last twenty years or so we Brits have become ever more obsessed with property and the price of it. This obsession seems to be deeply rooted in our national psyche, unlike say the French, Italians or Germans. On occasions this can lead to greed suppressing other emotions such as fear and lead us to being less cautious, than otherwise might be advisable.
Considering buying a holiday home (especially abroad), note to self, Engage Brain!
On the other hand when buying an investment ‘property’ (as opposed to a home), we are unencumbered by all the emotional baggage and distractions that’s attached to our home. We can be hard headed as we run the numbers and negotiate wearing our best poker face. The only considerations when looking at a buy to let are cold unemotional business ones. Such as is the property good value relative to the market, on a like for like basis? Is the area up and coming and how is that likely to impact capital appreciation? How easy will it be to rent and what is the yield (all costs in)? What are the total costs of buying/owning, mortgage, insurance, re-decoration/repairs and professional fees etc? How does the current tax environment affect my potential returns? Of course none of this is rocket science, just good old common sense.
If the saying ‘that the first casualty of war is the truth’ is a truism, then ‘the first casualty of buying a holiday home is often basic common sense’.
We are a nation seemingly obsessed with property and property prices. Witness the rash of TV programs imploring us to relocate, trade up, buy to let and do up to sell. In the five last five years property prices in Britain have increased dramatically and a whole industry has sprung up encouraging us to release equity and buy abroad. The vested interests (VI) such as the Developers, Estate Agents and Banks/Building Societies are ably assisted by the ‘Lifestyle Media’, in marketing the dream.
So what happens when we get into the process of buying a holiday property? Is it a home or an investment? It’s not really a home, or more correctly our home, as we don’t live there, we just visit occasionally. However due to the cost and commitment of owning a holiday property, we have to view it in investment terms. On the other hand we shouldn’t view holiday properties purely as an investment though, as we are going to spend a fair proportion of our limited but highly valued, family holiday time there. So a holiday property is neither a family home in the true sense, or a pure investment, only to be judged on the financials. A second property bought as a holiday retreat is in reality a bit of both. A home away from home and part of our long term investment strategy, in other words, a compromise! There is no doubt in my mind when we’re buying a holiday property, the line between emotional ‘home buying’ and hard headed ‘investment analysis’ becomes blurred. The former always triumphs over the latter as we metaphorically chase our rose tinted dream and in some cases, rose gardened cottage.
Once we’ve found a holiday property, the contracts have been exchanged and our Solicitor rings to say we’ve completed, the honeymoon period appears all too brief. Previously caught up in the full flush and thrill of the chase, bask awhile in the afterglow, for it does not last long. The fact that we may have let our heart rule, in the run up to buying our holiday property, soon becomes apparent with the arrival of the first set of bills. Mortgage, insurance, council tax, utilities, appliances, furnishings, service charges, the list is almost endless. Having let our heart rule up to now, we re-engage our heads and focus on the investment side of the equation.
The dying embers of the honeymoon period are finally extinguished when a sober assessment of the business case you put together on the back of a napkin in a beer garden/tapas bar, doesn’t now seem quite so robust. Of course It’s human nature that if we really want something we tend to emphasise the positives. This is to convince those around us and indeed ourselves that we’re doing the right thing, for the right reasons. It is easy to play down any negatives that don’t help support your case. If you want to be convinced of something, you can be pretty persuasive.
We generally underestimate the costs that go along with ownership of a holiday home and if we intend to rent it out, over estimate the revenue. Estate Agents and Developers Sales staff can play a big part in this. Ask them questions about running costs and rather than be evasive, they will tell you exactly what you want to hear. The only lies they tell, may be by omission but they will spin everything their way. Ask them about income from both long and short term lets and they will be bullish, confirming your own thoughts. Beware of sales people bearing good news. Do not take anything you’re told at face value, cross check and always test assumptions (especially your own). The key rules of the property buying game you need to remember are, firstly Caveat Emptor or Buyer Beware! The second rule is if the deal seems too good to be true it usually is and the third and final rule is, ensure you take independent ‘subject matter expert’ advice on legal, value/survey and financial matters. Both Estate Agents and Developers will offer you a ‘one stop shop’, for a property, legal work, survey and mortgage. It’s too cosy and they will all have a vested financial interest in you buying and therefore perhaps not be as diligent as you my like.
If we intend to rent out the property, especially on short term holiday lets of a week or two, its easy to grossly underestimate the costs. These costs come in the form of our time and the direct costs associated with the property being used on a short term, high turnover basis.
Mad dogs and Englishmen
There’s no doubt that buying and selling property in the UK can be a minefield, especially for the uninitiated or inexperienced. However that pals into insignificance when you consider the additional pitfalls that can await us in buying abroad as many are now finding out.
Pablo Silver or Lead?
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mg
well yes, with all the available info’ in the last year or two (not that i think that excuses the lies coming from those who get paid to look after your interests then or now), but 5 years ago, the odds looked similar in Spain to those in the UK in the 80’s. In other words ‘how can you go wrong?’
Call us naive if you like, but i think most people (through experience buying in the UK), considered lawyers, judges, the courts, to be above lies, dishonesty, black money etc, (even if we thought estate agents were not to be trusted.) That did give a false sense of security.
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mg
well yes, with all the available info’ in the last year or two (not that i think that excuses the lies coming from those who get paid to look after your interests then or now), but 5 years ago, the odds looked similar in Spain to those in the UK in the 80’s. In other words ‘how can you go wrong?’
Call us naive if you like, but i think most people (through experience buying in the UK), considered lawyers, judges, the courts, to be above lies, dishonesty, black money etc, (even if we thought estate agents were not to be trusted.) That did give a false sense of security.
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So why haven’t people learned from the pension selling fiasco, that questions should always be asked, then asked again, then the situation weighed up that interest, porperty, shares, can go down as well as up.
I certainly believe that crooks or not, the Spanish developers are very clever, insomuch as they know that get someone there for a couple of days, stay will them, let them witness the sunshine, entertain them with whatever drinks they want. Yes, the punter is now relaxed so the sales have little to do, the punter will do it himself. See the holiday home, see the rental income, believe what they are told it will be worth in 5 years.
Where can I sign now?How many sales reps., regardless of what they are selling, do you believe?
Best wall coating, double glazing, people carrier, phone contract, on the market you can get. Do you believe or shop around, or question.
Wonderful development this is, just 200.000€ nothing to see but a plan and brochure. Never been to the area and sometimes the Country before, and yet people sign up. -
Hi All,
Nice post Pablo. Though I am going to disagree with you over the Brits being the most property obsessed nationals.
The Spanish, Italians and French are equally interested. But there has been a big difference between their economies and ours. In these three countries agriculture has formed a much larger part of their economies.
As such, their countryside is full of a wide variety of agricultural buildings and houses. It is quite normal for Italian families to own 4/5 properties because of their ties with the rural economy. The same has been true in France and Spain. Hence, buyers have often had access to free housing from within the family unit. I have just returned from a trip to Italy and was told by Italians that the cute properties I expressed interest in buying would not be sold (unless at a very silly price) because a family member might need them in the future.
It should also be borne in mind that the UK workforce is hugely more prepared to up sticks and move to another part of the country where there is work, thus creating an additional demand for housing. This is much less so the case in the Latin countries where many people prefer to remain close to where they were born.
Also,house prices have risen significantly in all the European countries (bar Germany which has a culture of renting) as well as in th US,Oz,NZ, Thailand, China etc. It is not purely a UK phenomenon. It’s a global phenomenon.
Those who have overstretched their finances will get hurt but I’ll repeat once again that no-one deserves to lose their shirt because of the crooked scumbags who have lorded over the Spanish market ( and who are now operating in Bulgaria,Turkey etc.)
I’d also be very wary of much that is written in the specialized property mags. Never forget that these magazines rely on the advertising revenues from developers,agents etc. and are not going to upset them.
Un saludo,
Casa La Loba
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yes, of course there are sort of people, easy targets, but don’t make the mistake of thinking all of us are that way. You must have noticed the posts from those who did their homework and still got screwed!
I wish people would get away from this ‘it’s the buyers fault for being screwed’ attitude, and treat that as an unfortunate situation caused by dealing in most cases with dishonest liars. It’s not only insulting but mis-informed in many cases, and smacks of going on the side of the bad guys.
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(Work related)
With the current market trends, we’re finally seeing vendors fall into several catergories.
1. The vendor who paid far too much for his/her property and are unwilling to lower the price as they don’t want to take a loss. Yet “really” want to sell. These are generally the investor type who seem unwilling to admit they made a bad investment.2. The vendor who bought they’re property 20 years agofor 4 million pesetas and are trying to sell for at an exhorberent rate. Thankfully after a few months on the market, and shock no sale! they are willing to listen to our suggestions and either do some work on they’re property or lower the selling price.
3. The vendor who is interested in selling they’re property and puts put it on the market at a reasonable price.
4. The desperate to sell who for one reason or another need to sell for which ever reason.
We’re finding that demand down here (CDS) is strong. The problem is finding properties that are within the budget and that values up.
If they both earn around the 1000/1200€ mark, they need to be looking at an apartment on sale for 190.000/210.000€ that values up very well!Or they need to go for a studio/1 bed apartment. Problem here is the Inverse Property Law comes into play. The smaller the property the more expensive it is per square metre. So they are generally even less likely to value up!
2 examples: apartment, 2 bed, second line beach. No garage, no pool. no lift (3rd floor), no views, total refurbishment. they are now selling for 220.000€ (prev. 250.000€) and there is still not interest.
Another property sold within 5 weeks at 260.000, third line, sea view, community parking, well maintained, lift, etc…(Private)
Just sold my flat. Bought it a year ago for 200.000€ just took a reservation at 235.000€ within 2 weeks of putting it on the market. Why? because I did’nt over price it (for the area), done some work on it, etc….
And I’m buying my first house for just over 300.000€. Which I’ve had valued by TINSA at 400.000. The vendor has to sell for personal reasons, that’s why I got it at such a good price. The nearest property is selling for 520.000€ and in my opinion will not sell till they drop the price too 400.000€ or so. -
@maximus wrote:
Although Spain expects an increase in population it lacks building control. Areas are getting spoilt so demand eventually falls. More worryingly, Al Qaeda has said it wants to regain once-Muslim lands like Al-Andalus (Andalucia).
This could have a devastating effect on property.
Al-Andalus is/was the arabic name given to the parts of the Iberian peninsula that they controlled from the 700 to 1400s. So that’s 80/90% of spain and all of portugal.
But reclaiming muslim land also means taking sicily, greece, cyprus and most of the southern balklands. So at the moment I thinks its an open threat.
And don’t forget Spain has been dealing with terrorism for a long time now.
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“don’t make the mistake of thinking all of us are that way.” – Never have and don’t recall ever saying “all”
“I wish people would get away from this ‘it’s the buyers fault for being screwed’ attitude” – So you don’y accept that some buyers are at fault?
“smacks of going on the side of the bad guys” _ No sides being taken.
“seem unwilling to admit they made a bad investment.” – But this is often the case, people do not want to accept they may have made a bad decision. The new car buyer can be likened to this. How many times have you heard a person who has traded in their car for another saying what an excellent deal they had.
Don’t think I have heard many say they had a terrible deal, yet the car dealers are the ones that make the profit. -
mike wrote:ralita wrote:I give one example: Cape Verde.
I don’t know how you format your replies, Ralita but you do it badly making your posts difficult to follow. Please don’t take that the wrong way, it’s an observation rather than a criticism.
However, I did pick up on the Cape Verde comment. Now, is that a small island off Africa which it takes two days to get to from Britain? I was quite bemused when I heard that some people were considering investing there. Have you got any details? Crazy prices?
There is a lot of “investment”going on there. Prices for a second line apartment is now about
120K Euros which I find crazy for an underdeveloped place. -
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goodstich44 wrote:I wish people would get away from this ‘it’s the buyers fault for being screwed’ attitude, and treat that as an unfortunate situation caused by dealing in most cases with dishonest liars. It’s not only insulting but mis-informed in many cases, and smacks of going on the side of the bad guys.
Do not worry, the credit is getting tighter as we speak. People will not be able to flip properties because banks won’t give them anymore money.
In fact, even buyers with good credit won’t be able to purchase without putting a hefty deposit.
I am just very suprised that people are not aware of the big crash which is coming, it won’t be pleasant but it will make the global real estate market healthier. Otherwise, is it worth working when you can flip houses and get twice as much money?
I am not sure what people like Claire and Katy cannot understand from my postings, but it is their problem not mine.
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mike wrote:ralita wrote:Otherwise, is it worth working when you can flip houses and get twice as much money?
My thoughts exactly, it’s a ponzi scheme and at some point it has to run out of new blood to sustain itself
This is the only thing which makes me mad, that people thought that this is going to last forever. At least this is what Channel4 and A Place in the Sun were trying to say.
And Brits were the ones mostly interested in this, together with their cousins from USA.
In other countries funny money i.e. easy credits were not available as easily.And the last ones in the Ponzi scheme remained with the overpriced asset in their hands.
Now, how would you call these “last ones”? Unfortunate, misinformed, stupid? -
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@mike wrote:
@Claire wrote:
[quote=”mike
Looking beyond any accusations of xenophobia, do you think there may be a reason why the Brits are so fond of property?
😮
What a bizarre question!
I found that unnecessarily rude, Claire, but to clarify.
Mike , if you can find anything rude in what I said then you must be of a delicate disposition. 😕
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mg wrote:“seem unwilling to admit they made a bad investment.” – But this is often the case, people do not want to accept they may have made a bad decision. The new car buyer can be likened to this. How many times have you heard a person who has traded in their car for another saying what an excellent deal they had.
Don’t think I have heard many say they had a terrible deal, yet the car dealers are the ones that make the profit.no argument. But sometimes you need to know when to cut your loses. If you need to sell. If you don’t wait to the market is more favourable.
We have a couple recently who came in asking about a valuation on their property. Unfortunately they paid far too much for it (agent convinced them to, market trends, blah, blah, blah) and even though it was a lovely property they would get no where near to what they were asking. If anything they might make a loss. And since they don’t need to sell we simply recommended better to rent if possible and keep it as a holiday home until things pick up.
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mg wrote
‘ And what about the fools that went onto it, eye wide open with rose tinted?
Don’t you think it is also worth bringing that to others attention? ‘……….some might well have done, and yes it’s good to bring that to peoples attention, but it sounds like your saying it’s ok for the sharks to lie and cheat to them,’ they should have known better’. With that attitude, are you not taking the side of the liar/cheat over the side of the honest person who has made a mistake? There are some very rich agents/deveolpers much talked about on here with that attitude!
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@Claire wrote:
@mike wrote:
@Claire wrote:
[quote=”mike
Looking beyond any accusations of xenophobia, do you think there may be a reason why the Brits are so fond of property?
😮
What a bizarre question!
I found that unnecessarily rude, Claire, but to clarify.
Mike , if you can find anything rude in what I said then you must be of a delicate disposition. 😕
It is possible that I am of a delicate disposition. However, in a thread which has involved some friction it’s best not to call a question bizarre without explaining oneself. In that way the person might expand, which I did anyway, and not feel insulted.
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goodstich44, you give the impression that when things go wrong, it is everybody else is a fault?
“but it sounds like your saying it’s ok for the sharks to lie and cheat to them,’ they should have known better'” – Does it? I will convey your thoughts again to the employee I bailed out (one who has been caught), and to no financial benefit to myself. I still maintain that he was part to blame, as he purchased blindly.
“With that attitude, are you not taking the side of the liar/cheat over the side of the honest person who has made a mistake?” No.
“There are some very rich agents/deveolpers much talked about on here with that attitude!”
So I have read, but it doesn’t mean that if you don’t agree with your sentiments, that you are a rogue, cheat or liar. In fact, your judgement of character is so incorrect, perhaps you feel bitter towards some of those you mention, due to your own personal experiences, where perhaps you should take part of the blame? -
I think caveat emptor is always advisable. However I think it is stretching things a little to suggest that buyers in Spain should have approached the market with a working assumption, that the system from top to bottom was riven with corruption and malpractice. I don’t think it was at all naive of buyers to assume that a modern European democracy, with membership of the EU, would not regulate its planning system and the laws governing property transactions effectively. 😕
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Buyer may not have been aware that the market was riven with corruption and malpractice, but if you are putting your money into a foreigh Country, the more questions and doubts you should have is you wish to safeguard your money. Who would put 300K into say and Italian property, just on the word of an agent who is selling. What about the laws of the land, you cannot expect the laws to be same as in UK as every Country differs, EU or not.
“I don’t think it was at all naive of buyers to assume that a modern European democracy, with membership of the EU” So would you say buying in maybe Bulgaria is straightforward and no pitfalls?
Remember, some purchasers were made aware that the correct consents were not in place, yet proceeded with the purchase.
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@mg wrote:
Buyer may not have been aware that the market was riven with corruption and malpractice, but if you are putting your money into a foreigh Country, the more questions and doubts you should have is you wish to safeguard your money. Who would put 300K into say and Italian property, just on the word of an agent who is selling. What about the laws of the land, you cannot expect the laws to be same as in UK as every Country differs, EU or not.
I put my ‘questions/doubts’ to my then Spanish lawyer before anything was signed – believing he was being paid to give me the correct legal advice. Maybe I should have taken Scotland Yard along with me too ❗ Would they have known what was going on ❓
As for the ‘laws of the land’, it is clear that many who should be bound by them have no respect for them, including some Spanish developers & some Spanish lawyers. In fact, they appear to think they are above some of the Laws of Their Land.
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mg wrote
”perhaps you feel bitter towards some of those you mention, due to your own personal experiences,”
well yes, i wonder why??????????? for heavens sake, will you never get through your head that many people on here have been lied and cheated to by a load of low down scum bags, through no fault of there own, apart from putting trust in one or more of these a**eholes.
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“will you never get through your head that many people on here have been lied and cheated to by a load of low down scum bags, through no fault of there own”
No need to penetrate the skull, it is already in there, you will have noticed that I can read and also, I do talk with people.You say noyhing about the people who were aware, yet still p[roceeded and then cried and shouted.
Is that also the fault of the ” low down scum bags”?Suzanne, was it an inde., lawyer you used or one recommended by the selling agent or developer?
“As for the ‘laws of the land’, it is clear that many who should be bound by them have no respect for them” – Agreed where appropriate, but for generations hasn’t this been said about Spain, Italy, France, etc., there will always be those who just go upto the line and those who go over it.
Of course I sympathise with the genuine peopl who have been caught out as a reult of corruption, mis-selling, etc., (as I do with the people who were mis-sold pensions), but it does annoy me when things have gone wrong, it is assumed that it is always the purchaser that has been wronged, irrespective of what action they took.
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@Ponzi wrote:
I think caveat emptor is always advisable. However I think it is stretching things a little to suggest that buyers in Spain should have approached the market with a working assumption, that the system from top to bottom was riven with corruption and malpractice. I don’t think it was at all naive of buyers to assume that a modern European democracy, with membership of the EU, would not regulate its planning system and the laws governing property transactions effectively. 😕
This has to be THE most sensible and astute comment I have read. Wish I had said it!!
Mark – surely you can feel an article coming on?
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Goodstich/MG
Let me put my own case forward. 3 years ago I bought an adosado – brand new that had just been completed. I knew the developer and knew the agent – as I worked for the agent at the time. He asked me to sell the remaining 7 units for him – no problem – I thought they were ok, good value and given the market a possible medium to long term investment -= so I bought one myself.
Having bought one I made the mistake of telling prospective purchasers that I had which in most cases convinced them to buy. (in my defence I also told them to go home and think about it and if there was anyone else interested I would let them know – but to no avail)
I did have doubts because it was a large undertaking for me- but I bought for 3 reasons.
1. The agent who was my employer and also a friend of mne, told me he would pay a rental guarantee every month
2. He told me that I could subdivide horizontally after 3 years which meant I could create 2 apartments – 1 x 1 bed that I could keep for me, and a 2 bed one to resell.
3. Having already convinced 3 other people to buy – mainly because I had already bought – I felt duty bound to complete – even though by then doubts had started to creep inOn that premise I went ahead.
However the rental guarantee turned out to be my actual salary – ie the agent replaced the salary I was getting with a rental guarantee – so it was worthless.
Secondly I found out afterwards that to get a horizontal separation is nigh on impossible.
The moral of this story is two fold.
Firstly – if someone who is supposedly your friend can lie to you – anyone can – this guy was German but he could have easily been English
2ndly it was down to no-one else but me to check this out and had i have had the knowledge of how to do it (or that you should do it) at the time I would have – however I knew nothing about property then. In this respect I should have gone to a professional to seek advice (and now it is something I strongly recommend clients do)
At the time I had my doubts because I don’t like town houses and have always bought apartments – I am comfortable in an apartment and feel they are a better bet – so I didn’t act on my gut instinct – and I now have a situation where I am fed up with rentals (in fact last year I didn’t rent it out at all) have a large mortgage which is consuming all my money and is constantly rising
And who is to blame for all of this.
I could take the easy route and blame the agent. After all he blatantly lied to me.
However it was my money and my responsibility and a simple check would have shown (on the division anyway) that he was lying – or shall we say misguiding.
Therefore the only person I can level any sort of blame at – is me.
I realise there are many others who have been duped worse than I and I am not suggesting for one minute that every one of you is to blame because there comes a point where you have to put your trust into someone.
However this experience has taught me one thing. never put my trust in someone or in something that I know nothing about.
I will invest in property in Spain again because like the UK it offers good returns in the long term and it is a great place to live. But in the future I will make sure that it is profitable for at least one person – me. If not I will walk away.
The experience hasn’t made me bitter (although there have been sleepless nights) but it has added to my life experiences and I hope that I can pass on this experience to others in the hope that they don’t fall into the same trap – and indeed am willing to help others if they require assistance to ensure this.
Sorry for my ramblings but i feel the two of you are going round in circles with the same argument. You both have valid points of view and experiences to fall upon, but you both fail to recognise the others point of view. Perhaps it is time to agree to differ because the only arguments ever won are the ones you never participate in
Best of luck to both of you.
Vince
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@Ponzi wrote:
I think caveat emptor is always advisable. However I think it is stretching things a little to suggest that buyers in Spain should have approached the market with a working assumption, that the system from top to bottom was riven with corruption and malpractice. I don’t think it was at all naive of buyers to assume that a modern European democracy, with membership of the EU, would not regulate its planning system and the laws governing property transactions effectively. 😕
Excellent post Ponzi. 🙂
This thread appears yet again,to have become an REA v Purchaser scenario.
How easy the EA’s find it to blame cheated buyers in the first place because of stupidity!. It seems to me from Mikes words that it was common knowledge that there were “dodgy” building licences and unscrupulous developers/lawyers around. Pity those EA’s that many of us had dealings with didn’t warn us of that at the time they were happily selling these developments with either illegal licences or none at all. But then they were probably just too distracted ,mentally counting up their commission from the sale they were about to make, to give a stuff.!
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Vince, thanks for that posting, interesting reading of your experience and certainly refreshing to see someone prepared to take some of the blame themselves. Bet you have learned since then?
Regarding my comments on people see things through rose tinted glasses, let me give an insight to something I am aware of. A person who I know is buying their first property in Spain. Went on one of the 3 or 4 days tours with an agent, their first visit ever to Spain. Yes they decided to buy off plan 250K. The development is a year late, well actually, they haven’t yet started any construction. I asked if they had concerns, due to the recent publicity and the market in general, bearing in mind they paid a 30% deposit, so their money is now tied in.
They said no, as they had received a letter from the agent, informing them that the value of their property had already increased 10%, so they are looking to a good return.
I have read that the developer, even in good times, does not have a good reputation and over-running is the norm
When, sorry, if things go wrong, is the iffy developer or agent to blame, when the purchaser should of done some homework, especially now with all the publicity?PS The purchaser is a professional person in UK!!!
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Ponzi wrote:I think caveat emptor is always advisable. However I think it is stretching things a little to suggest that buyers in Spain should have approached the market with a working assumption, that the system from top to bottom was riven with corruption and malpractice. I don’t think it was at all naive of buyers to assume that a modern European democracy, with membership of the EU, would not regulate its planning system and the laws governing property transactions effectively. 😕
USA is the most modern country in the world and the one where the property sacre.
Nevertheless, many realtors induced the wrong ideas in the naive people’s heads that property can only go up. And many buyers fell for it and bought on top of the market.Why did they buy? Because they did not want to be left behind. Now they point fingers instead of acnowledging their greed and stupidity.
The intersection between EA’s mapractive and some buyer’s stupidity resulted in the current mess.
Spain in no different, if not worse.
Of course Bulgaria, MOrocco and Cape Verde are infinitely worse.
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@Claire wrote:
Excellent post Ponzi. 🙂
This thread appears yet again,to have become an REA v Purchaser scenario.
Are there REA posting in this thread? I hadn’t noticed
@Claire wrote:
How easy the EA’s find it to blame cheated buyers in the first place because of stupidity!. It seems to me from Mikes words that it was common knowledge that there were “dodgy” building licences and unscrupulous developers/lawyers around.
It was mentioned in this thread on this website in May 2005
http://www.spanishpropertyinsight.com/forums/viewtopic.php?t=97
I think it was common knowledge then, I knew and most of the people with whom I discussed Spanish property were aware. The big question is why didn’t you know?
Look around at other topics around that date, the subject was discussed often and off plan in particular was showing signs of strain on the CDS
@Claire wrote:
Pity those EA’s that many of us had dealings with didn’t warn us of that at the time they were happily selling these developments with either illegal licences or none at all. But then they were probably just too distracted ,mentally counting up their commission from the sale they were about to make, to give a stuff.!
I think you are upset and feel let down but don’t imagine that everyone who writes something you don’t like is an estate agent
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@Claire wrote:
So despite all the publicity, the EA’s are still regurgitating the same lies. Nothing is changing then. 🙄
And people are still looking to buy ,go to exhibitions and on inspection trips !!.
One can preach/argue pro’s and con’s infinitum but fact of the matter is people will make up their own minds what to do .
An unbalanced /biased view has the effect of people thinking it won’t happen to them. They being smarter than the Joe’s who bought illegal builds or got conned by lawyers et al 🙄
IF you want to stop other people falling foul, even through no fault of their own, of the corruption when buying in Spain/elsewhere abroad then highlight the negatives and warnings but do it without personal agenda entering in to it.
Mike
Anyone who tries to keep a balance to the discussions stands accused. Don’t know why.
But then some of the posters on here wouldn’t last 5 mins in the CAB even as clients 😉 -
@ralita wrote:
@Ponzi wrote:
I think caveat emptor is always advisable. However I think it is stretching things a little to suggest that buyers in Spain should have approached the market with a working assumption, that the system from top to bottom was riven with corruption and malpractice. I don’t think it was at all naive of buyers to assume that a modern European democracy, with membership of the EU, would not regulate its planning system and the laws governing property transactions effectively. 😕
USA is the most modern country in the world and the one where the property sacre.
Nevertheless, many realtors induced the wrong ideas in the naive people’s heads that property can only go up. And many buyers fell for it and bought on top of the market.Why did they buy? Because they did not want to be left behind. Now they point fingers instead of acnowledging their greed and stupidity.
The intersection between EA’s mapractive and some buyer’s stupidity resulted in the current mess.
Spain in no different, if not worse.
Of course Bulgaria, MOrocco and Cape Verde are infinitely worse.
“I can calculate the motions of heavenly bodies, but not the madness of people”.
That’s Isaac Newton assessment of his experience of the South Seas Bubble catastrophe of the early eighteenth centaury. Newton lost most of his fortune in the bust.
http://www.stock-market-crash.net/southsea.htm
People I’m afraid are prone to bouts of irrational exuberance where money is concerned. History is littered with many episodes of speculative bubbles and crashes. In most of these instances the bubble was nurtured by unscrupulous middlemen with a keen eye for a quick buck. The fact that these episodes are numerous and reoccur frequently confirms the axiom that ‘People who forget the lessons of history are doomed to repeat them’. Now the problem I have with the argument that people who are burnt by a speculative bubble only have themselves to blame is that it does not address two crucial issues.
1. The confidence tricksters who manipulated people’s naivety for pillage type profits tend to escape unscathed. (Typically they move on to new ‘opportunities’ e.g. Bulgaria, Dubai etc)
2. Ascribing the blame to mere foolishness doesn’t stop similar bubbles arising in the future, with similar dismal results. Governments are quite keen to legislate on matters from the wearing of seatbelts to minimum wages, why shouldn’t they be more proactive in the area of financial regulation/education when it comes to investment, especially in property?
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Hi MG
yep I sure have learned and as I said hopefully can pass that information on to others through various mediums (this forum and a local newspaper I write for as well as some other websites)
However it hasn’t put me off buying in Spain. I live here for a start and would not now invest in the UK for the very reason I don’t live there and cannot manage it. (the reverse of what I advise people coming to buy here for investment – don’t do it unless you can manage it here and live here)
What I have also learnt is that not everyone tells the truth here )not that they do in UK either) but it seems to be accepted practice to be an habitual liar in some professions. So rather than accept what I am told I generally will check up to see how truthful that person is being. If they aren’t then I wont deal with them – full stop.
If they are then they garner trust till the next time – but every time I will check up to make sure I am not being fed rubbish (although nowadays I am a lot more informed in property in Spain having worked in it for four years off and on and know where to go to check things out)
But it isn’t just foreign agents. I was out with my sister (who lives close by) and who is looking for a plot of land to put a wooden house on. We were shown around by a local Spanish agent who told us straight faced that putting a wooden house on this plot of land would not be a problem.
Now I know the town hall of Oliva and I know that in certain areas they have actually told the owners to pull down their temporary structure. And this was one of those areas – and I know there is no chance of water or electricity (in spite of the agents insistence that it will be there within a year.
So you see it isn’t just foreign estate agents – it seems some Spanish ones have also caught the bug
For me though the whole experience was bad for one reason – apart from the fact that a so called friend could lie to me – my main reason for buying was to divide and sell (ie split into two apartments) Which I did – only then to be told I had wasted my money. In all this time he could have just said – don’t do that (even after I had bought I could have lived with that) and been a few thousand euros better off) – but he never – he let me continue converting the apartments
However as I said before – a simple check (which I now know how and where to do) would have established this very easily.
Hindsight is fantastic vision – just wish i had the foresight to see it then
Best wishes all
Vince
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Ponzi wrote:1. The confidence tricksters who manipulated people’s naivety for pillage type profits tend to escape unscathed. (Typically they move on to new ‘opportunities’ e.g. Bulgaria, Dubai etc)
They are sharks and dishonest and all the nasty things, but they are doing their business.
Their business is to take your money! Your business is to protect your money.Do not buy stuff just because your neighbors and/or friends bought. Think, calculate and see if you can afford it if the hell breaks loose.
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ralita wrote
”They are sharks and dishonest and all the nasty things, but they are doing their business.
Their business is to take your money! Your business is to protect your money. ”…………..dear oh dear, i think you may well be right, which is why better regulation is so badly needed in this industry. I’m no angel, but if i ever stoop to that level in my business, i deserve being closed down and locked up!
even 5 years ago, we thought we were being careful, we were using a UK agent, so at the start it seemed to make sense to use a UK lawyer specialising in property abroad. Yes they were agent recommended, but being a lawyer that we would be paying, i don’t think it was naive at that time, with almost none of the current information available about how rife corruption is in the system, to believe they would work in our favour. In all other dealings i have had with lawyers working for us, buying residential or commercial, we have not had to doubt they were working for us! (obviously we know better now).
So yes, if trusting legal bodies working (in theory) for you is wrong, or expecting a system to regulate against and punish the sharks and dishonest liars, is also wrong, then i must be guilty……… and how wrong is that!!!
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goodstich44 wrote:ralita wrote
So yes, if trusting legal bodies working (in theory) for you is wrong, or expecting a system to regulate against and punish the sharks and dishonest liars, is also wrong, then i must be guilty……… and how wrong is that!!!This will never happen. The governments receive sponsorships from Estate Agent Organizations and they close their eyes.
In UK the legislation is much stricter so it is more difficult to be conned. This is why Estate Agents who wanted to get more money went to Spain and from there to sateliites like BUlgaria, Morocco, etc.
The Spanish or Bulgarian definition of being honest is much different from being honest in UK. If one does not know that and does not study that, then it is EXTREMELY dangerous to adventure and do business anywhere else but UK.
I am sure many people learn this lesson the hard way, but at least they can avoid future problems.
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Hello ❓
Is it safe to come out yet 😛With Spain and in particular Costa del Sol going through a rough time at the moment with the corruption legal situation regarding planning and the lack of occupancy licences etc.
With the opinion in many newspapers and forums that property prices will fall in this region,what are the opinions as to what would happen to property prices should the Spanish government sort out the legal status of all developments which have various problems.
Regards
Jim 😀
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@Ponzi wrote:
1. The confidence tricksters who manipulated people’s naivety for pillage type profits tend to escape unscathed. (Typically they move on to new ‘opportunities’ e.g. Bulgaria, Dubai etc)
Or new markets? Anything that the average punter doesn’t understand? I compare the Spanish property market with the technology share boom at the end of the millenium. I used to read the newspapers which promoted managed funds in technology shares which drew on the experience of professionals who knew what they were doing. In the Spanish property bubble the same newspapers advised investors to use professional estate agents and disregard everyone else. Trust estate agents!!! Only if they are British, maybe??
@Ponzi wrote:
2. Ascribing the blame to mere foolishness doesn’t stop similar bubbles arising in the future, with similar dismal results. Governments are quite keen to legislate on matters from the wearing of seatbelts to minimum wages, why shouldn’t they be more proactive in the area of financial regulation/education when it comes to investment, especially in property
Education in finance? Hmmm. At masters level I was taught that stock markets are perfect, it isn’t commonsense but allows a number of theories to be applied and I think theorists prefer hypotheses more than they like the real world. I think anyone following their advice would end up fleeced in one way or the other. I’d like to point out that I have sold almost all my shares, I think this worldwide property crash is bringing everything down with it including the stock market
As an example Charlie Munger, best mate of Warren Buffet tells of the nobel prize winning economist who explained their success as pure luck. After a dozen years of luck the economist was beginning to look stupid and so he admitted that there was an elelment of skill involed. This nobel prize winning economist even went on to start a hedge fund which went bust after 18 months.
I’d advise teaching commonsense
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@Melosine wrote:
IF you want to stop other people falling foul, even through no fault of their own, of the corruption when buying in Spain/elsewhere abroad then highlight the negatives and warnings but do it without personal agenda entering in to it.
Agreed, learn from mistakes
@Melosine wrote:
Mike
Anyone who tries to keep a balance to the discussions stands accused. Don’t know why.
But then some of the posters on here wouldn’t last 5 mins in the CAB even as clients 😉Well, I think you do know why, people were lied to and robbed. However, if they don’t understand and move on they will probably become bitter and mistrustful of everyone which won’t do them much good.
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Hi Vince ❗
Seems like I am in the shit then ❗
Well will simply have to sit it out for a few years and hope for the best as experience has always taught me in investments or property is never to panic and it will have to be plan B or C.
Anyway the chap who owns Viva says that everything is really O.K so who am I to be concerned. 😀 😀 😀 😀 😀 😀
The worse that can happen is they can knock it down or I have a nice place for holidays and can hopefully rent it out in between for the next 3 to 5 years.
Another option is to reduce the price and loose a few bob,not nice but thats maybe just how it is.
As for me I am looking forward to the weekend jokes and I have a few real crackers amongst many in my library.Regards
Jim 😀 -
Hi Jim
one other thing you may consider and is something I am considering myself – is an interest only mortgage. At least in my case it reduces my overheads significantly and even makes rentals seem a not too unattractive option (that is assuming you took a normal Spanish mortgage or one at all of course)
Anyway it is probably better to weather it out as I am sure that one day the garden will be rosy again and I can put on my rose tinted specs
Vince
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Hi Vince
Yep with you on this one as I have interest only at a rate that tops out at 5.5% as an ulitimate safe guard just in case rates go through the roof.
As you say it keeps payments down and with some rental income and holidays and got the property at a good price I am hopeful in the medium to longer term (not much choice really and a bit like the stock market a few years ago when it crashed.)
Pundits then saying that it would take 15 years to recover but it seems my shares are higher now than they were before the crash.
Think when the crap starts hitting the fan in the other countries where the off plan scam is hot and people continue to get fed up with this U.K nanny state then the circle may just start to come round again in some parts of Spain.
Problem is with stats is they are history figures and may not fully reflect totally whats may or may not be happening now and in the future as this has to be speculation.
It was only a few months back that these forums were saying that the market is still good and now look at them ❓Regards
Jim
😀There was 3 Irish men ❗ nope will leave it till the weekend 😀
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Drakan ❓
What I am trying to work out is why you would call this thread this name?
Has it burst ,will it burst ?
Seems from one point that the prices are around the same as they were say 3 years ago excluding of course the idiots that had their property on at silly inflated prices.
If that IS right then this is hardly a bubble thats burst but there again this is only my opinion.Regards
Jim 😀 -
Jim, in response to your last post, I’m sure that you realise that inflation is running far higher than govt statistics suggest, and if someone has been asking for the same price as 3 years ago, that makes the asking price at the very least 10% cheaper in real terms.
Added to that, a significant amount of properties have reduced their asking prices, and are prepared to negociate lower.
Has the bubble burst? has the market crashed? Well it depends how we define those terms. But what I would suggest to you is that on the CDS you can buy a property for approximately 30% less than you could 3/4 years ago (leaving aside the idiots as you say).
Should you accept my analysis of the market at the moment, then by anyone’s definitions IF the market comes off much more then it would be hard to refrain from such dramatic language. -
glassman wrote:Drakan ❓
What I am trying to work out is why you would call this thread this name?
Has it burst ,will it burst ?There is one way to see it:
– pick a price from a newspapaer/real estate agent
– make a lowball offer at 60% of the asking price. If accepted, the bubble has burst.
On the other hand, I perfectly agree that the Spanish market is and will always be the most attractive in Europe so it will recover first.
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Hi Forest Fire
Thanks for your view point ❗
I fully appreciate the inflation point and would just like to clarify what you are saying if you dont mind and will use an example of the point I am trying to make .
Lets take La Reserva de Marbella as an example and the prices were around the 220,000 max euros 3 years ago (excluding the silly priced ones).
So you are saying that anyone that had a property on this development or indeed any similar would now sell for 30% less ie 154,000 euros.
Same applies right along the coast so 700,000 is now 490,000 euros etc etc
If that is correct then perhaps the estate agents can confirm and I would totally agree that a biggy bubble has burst,
Ralita.
Thanks very much but your offer should you wish to make it is refused at 60% off 😀 😀Regards
Jim 😀 -
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I have seen one at La Reserva advertised at 185,000. Surely if prices dropped so low it wouldn’t be worth putting a place on sale if you have a mortgage, would be easier to just walk away. What happened during the last crash is that there were substantially less properties on the market as many were withdrawn. The majority on sale were distress sales (aged out etc.) or bank repo’s
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Hello again Jim,
In the example of your E220k asking price, I would not agree with your final figure of 154k (unless we are talking in 2003 values)
What I would suggest is that if they are still asking 220k in 2007, then the property is worth 15/20% less in real terms due to inflation. Therefore if the asking price is reduced to somewhere near 200k, there you have another 10% reduction, totalling a real price reduction of 30% (but not a nominal one)
Obviously my mathematical approach is over simplified -sorry it’s getting too late in the evening… -
Hi Katy/Jim
2beds/2baths @ La Reserva for 199,000 to 280,000 Euros ❗
http://www.inspain.tv/SearchResults.aspx -
@katy wrote:
What happened during the last crash is that there were substantially less properties on the market as many were withdrawn.
Maybe developers in the Alicante region feel they need to compensate for the same thing happening this time round (!)
http://www.typicallyspanish.com/news/publish/article_10218.shtml -
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Ralita
I just may have to take you up on that offer if I am still stuck with it so dont go away will you 🙂
Dont suppose you could have a back plastic bag with you by any chance ❓ 😀Suzanne.
Not seen one as low as 199 euros unless anyone wants mine but have seen them for 335 euros ha ,ha, haThanks Forest Fire.
Thats the problem I am having in my simple mind as all these various predictions of 20% 30 % etc all vary as some build in inflation and other start at different starting valuations.
In my simple terms the amount I paid (deposit) was on the price at 207,000 ) Now take into account that I have only had 30% invested in this and it dosent sound to bad ❓Maximus .Wash your mouth out ?
This forum ,talking the market down and help start a recession?
Whats brings you to think that ❓ 😀 😀 😀 😀Regards
Jim 😀
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@glassman wrote:
Drakan ❓
What I am trying to work out is why you would call this thread this name?
Has it burst ,will it burst ?
Seems from one point that the prices are around the same as they were say 3 years ago excluding of course the idiots that had their property on at silly inflated prices.
If that IS right then this is hardly a bubble thats burst but there again this is only my opinion.Regards
Jim 😀Jim property prices “are not the same as say 3 years ago” (i.e. stabilising). Property prices are falling on the costas and there are numerous reports acknowledging it although the media keep their profile low for obvious reasons, as an example this article talks of Aguirre Newman’s annual report on property and they have vested interest in the property boom going on and actually claim prices have fallen 4,7% in the last 12 months on the costas:
http://www.invertia.com/noticias/noticia.asp?idNoticia=1716222
And this other one stating that prices had fallen in Barcelona 3,8% for new builds:
You must understand that it’s not in anyone’s interest for this to happen as we all stand to lose, starting by me, albeit burrying your head in the sand and denying something which is all too blatant for all those minimally involved within the industry is useless IMHO as it won’t make it go away.
Property moves in 7-8 year cycles down here. We are now probably into the first or second bad year IMO.
Don’t worry, in a couple years time property prices will again soar at two digits p.a. in Spain. Let’s see if the same can be said for Turkey, Morocco, Bulgaria et al.
Again, everything is relative. Good locations will maintain their price some worse-off locations stand to lose a hefty percentage.
I perfectly understand that people are now buying properties for retiring as there are very good bargains in the resale market. There will be even more within the next years.
What I don’t advise much is buying off-plan now, although I have always defended off-plan as a superb investment providing you buy at the right time, which IMHO is not now.
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Drakan wrote:You must understand that it’s not in anyone’s interest for this to happen as we all stand to lose, starting by me,
I agree that you (as a lawyer) will lose from the downturn. BUt why do you think that “we all stand to lose”? This must a joke , right? Most of people will gain from a healthier market.
And no, prices in Spain and anyhere else will not soar anymore as it is not a normal
situation to have double digit gains. Do you imply that the inflation and interest rates will be atdouble digits in a couple of years? -
@ralita wrote:
I agree that you (as a lawyer) will lose from the downturn. BUt why do you think that “we all stand to lose”? This must a joke , right? Most of people will gain from a healthier market.
And no, prices in Spain and anyhere else will not soar anymore as it is not a normal
situation to have double digit gains. Do you imply that the inflation and interest rates will be atdouble digits in a couple of years?Prices in Spain will soar again after 5 years at two digits as has happened always Ralita and you have historical price charts that monitor and track these trends. Discussing this is futile. In 5-6 years time you will again see prices of property soaring above 10%. Two-digit growth is normal in real-estate booms.
I’m not sure if interest rates will hit two digits within the next years as they did back in the nineties when we even reached 15% or more (we didn’t have the Euro back then). Let’s hope not because that would mean that millions of Spaniards could not pay-off their mortgages. Even if the Euribor hit 8% that would deliver a serious blow to Spanish families when the average wage here is 1.540 Euros a month gross.
As you are probably one of the “burbujistas” (no offence meant Ralita) who take fun of the “so-called-pepitos” that are praying that prices will crash (i.e. you expect falls of 70% of the market value) this will not be the case.
As for most of the people will benefit from a decrease in prices is something relative. If you don’t own property yes obviously you will be benefited. However, 18% of Spain’s GDP is due to the construction business. For each loss of 1% in our GDP it is estimated that 100.000 jobs will be lost. And of course these people have family so the figure of those affected would be much higher. And in turn as they are consumers if they are sacked, their consumer spending diminishes etc… so a catch 22 situation is created and the ball rolls on.
Now this is something that a modern economy who has diversified it’s revenue stream can withstand comfortably. Unfortunately this is not Spain’s case which is over dependant in the real estate business. The following industry in importance would be tourism.
The worst hit will be the coastal areas where foreigners have been buying and investing heavily for the last 7-8 years. My personal opinion is that we will see decrease pf prices of 20-30% in these areas primarily due to the massive oversupply of property and lack of -foreign- demand and in part due to these homes being a second residence and not actually the primary dwelling so when things turn ugly the foreigners close down and sell-off unlike us natives.
Whereas in Spanish large cities, Barcelona, Madrid etc.. properties are bought by Spaniards mainly (although it’s true there are Spanish who have also bought as an investment ) as their first and primary home so if things turn out ugly they will not sell-off their properties and will pay their mortgages even if they have to eat bread and butter all month long and knowing Spain their family will help them out. I doubt prices in these large Spanish cities will fall more than 10-15% which is nothing taken in perspective that prices have tripled within the last ten years.
So when you dream with a property crash be careful with what you dream Ralita, because some dreams turn into hellish nightmares that may come back to haunt you at nightime. One man’s meat is another man’s poison.
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@Drakan wrote:
Prices in Spain will soar again after 5 years at two digits as has happened always Ralita and you have historiacl price charts that track these trends. Discussing this is futile. In 5-6 years time you will again see prices of property soaring above 10%. Two-digit growth is normal in real-estate booms.
Hi, Drakan. Do these historical price charts show real increase or notional increases? Do they take inflation into account?
@Drakan wrote:
I’m not sure if interest rates will hit two digits within the next years as they did back in the nineties when we even reached 15% or more
That suggests that there was two digit inflation at that time so in real terms maybe house prices didn’t go up at all some years
@Drakan wrote:
As you are probably one of the “burbujistas” (no offence meant Ralita) who take fun of the “so-called-pepitos” that are praying that prices will crash (i.e. you expect falls of 70% of the market value) this will not be the case.
I would happily describe myself as a “burbujista”. But lets do some figures and forgive me if I make incorrect assumptions, I want to learn.
Let’s say that I earn 1.540€/month. I understand that at that level I would pay no income tax, is that true? Are there any deductions from this income?
Now, if I wanted to buy an average property in Andalucia that would cost about €150K. Lets say that I have the 10% in transaction costs saved and a €10K deposit so I will have to borrow €140K.
Euribor is currently 4.106% so that means I would pay €5748.40 per year and €479 per month leaving me with €1061/month which is quite reasonable. But if I actually chose to repay the capital over 25 years then it would cost me €754.72 per month leaving me with €785 per month to live on which isn’t quite as attractive. In fact, for an average earner it’s almost half their wage. Of course they could survive on that amount but it wouldn’t leave much, especially if they were living in Barcelona or Madrid
In a low inflation environment my wages will not go up as quickly and that doesn’t get inflated away in as short a time as it used to. I am not going to starve but I won’t be living the high life and I believe that by owning a property valued at €140K I will have to pay a wealth tax, does anyone know how much?
God forbid I should want to get married and have kids. Heaven help us if at any time in the next few years ECB and therefore Euribor rates should increase! At the same time unless the average wages increase at double digit rates then no time soon am I, earning an average Spanish wage, going to be able to pay more to own property
@Drakan wrote:
However, 18% of Spain’s GDP is due to the construction business. For each loss of 1% in our GDP it is estimated that 100.000 jobs will be lost. And of course these people have family so the figure of those affected would be much higher. And in turn as they are consumers if they are sacked, their consumer spending diminishes etc… so a catch 22 situation is created and the ball rolls on.
The above is what I forsee which is why I compare it to 1929 because…..
@Drakan wrote:
Now this is something that a modern economy who has diversified it’s revenue stream can withstand comfortably. Unfortunately this is not Spain’s case which is over dependant in the real estate business. The following industry in importance would be tourism.
@Drakan wrote:
So when you dream with a property crash be careful with what you dream Ralita, because some dreams turn into hellish nightmares that may come back to haunt you at nightime. One man’s meat is another man’s poison.
I agree wholeheartedly. A lot of people are going to suffer and not only those who bought property but not thinking about it will not make it go away!
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Drakan wrote:ralita wrote:The worst hit will be the coastal areas where foreigners have been buying and investing heavily for the last 7-8 years. My personal opinion is that we will see decrease pf prices of 20-30% in these areas primarily due to the massive oversupply of property and lack of -foreign- demand and in part due to these homes being a second residence and not actually the primary dwelling so when things turn ugly the foreigners close down and sell-off unlike us natives.
So when you dream with a property crash be careful with what you dream Ralita, because some dreams turn into hellish nightmares that may come back to haunt you at nightime. One man’s meat is another man’s poison.Well, you use EXACTLY the same arguments as the optimists in USA were using 1 year and a bit ago. That Florida, California and Arizona will never crash, that Massachusetts does not have any more land, etc.
And look now, the prices are falling like a rock and there is no end in sights for the fall.
I am not at all dreaming about a property crash as I do not have any plans to purchase in Spain. About the helish nightmares, those will belong to the people who got into debt up their eyes, I am more that well prepared for any kind of disaster might be around the corner.
It is really impossible to see in May 2007 what the future years will bring, we just need to wait.
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@mike wrote:
Hi, Drakan. Do these historical price charts show real increase or notional increases? Do they take inflation into account?
Real increase, taken into account of course.
@mike wrote:
That suggests that there was two digit inflation at that time so in real terms maybe house prices didn’t go up at all some years
Correct. There was even a decrease in prices but no-one talked of an asset bubble such as now.
@mike wrote:
I would happily describe myself as a “burbujista”. But lets do some figures and forgive me if I make incorrect assumptions, I want to learn.
Let’s say that I earn 1.540€/month. I understand that at that level I would pay no income tax, is that true? Are there any deductions from this income?
Now, if I wanted to buy an average property in Andalucia that would cost about €150K. Lets say that I have the 10% in transaction costs saved and a €10K deposit so I will have to borrow €140K.
Euribor is currently 4.106% so that means I would pay €5748.40 per year and €479 per month leaving me with €1061/month which is quite reasonable. But if I actually chose to repay the capital over 25 years then it would cost me €754.72 per month leaving me with €785 per month to live on which isn’t quite as attractive. In fact, for an average earner it’s almost half their wage. Of course they could survive on that amount but it wouldn’t leave much, especially if they were living in Barcelona or Madrid
In a low inflation environment my wages will not go up as quickly and that doesn’t get inflated away in as short a time as it used to. I am not going to starve but I won’t be living the high life and I believe that by owning a property valued at €140K I will have to pay a wealth tax, does anyone know how much?
God forbid I should want to get married and have kids. Heaven help us if at any time in the next few years ECB and therefore Euribor rates should increase! At the same time unless the average wages increase at double digit rates then no time soon am I, earning an average Spanish wage, going to be able to pay more to own property
There is nothing bad in being a “burbujista” another thing is expecting property prices to plummet by 70% as Ralita has posted which is wishful thinking I believe.
Ja, ja welcome to the problem most Spanish youths have. And that is providing you make 1.540 which is high salary for Spain if you are below 30 y.o.
If we make the assumption you make 1540×14= 21560 Euros. Below 22k you are not taxed if employed. Correct Mike.
Euribor is currently 4,30%, not 4,1%, to which banks add spreads (diferenciales).
@mike wrote:
The above is what I forsee which is why I compare it to 1929 because…..
Heh, 1929. Those have been my thoughts over the weekend. The “irrational exuberance” springs to mind.
http://www.safehaven.com/article-6113.htm
Easy-credit is the smoking gun, interest rates the trigger and greed pulls it.
Back in 1991 in the last crisis people complained that houses weren’t selling, no-one spoke of a bubble . Nowadays everybody wherever you go, from Australia to Ireland (specially here), California, France etc.. everyone acknowledges there is a real estate bubble brewing. Only banks and finance ministers deny it along with developers of course.
I think last week, exactly last Tuesday the 24th April, we moved on from the “denial stage” (“there is no bubble”, “RE prices never go down”…) to the “uneasy stage”.
Who knows ? 😉
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@ralita wrote:
Well, you use EXACTLY the same arguments as the optimists in USA were using 1 year and a bit ago. That Florida, California and Arizona will never crash, that Massachusetts does not have any more land, etc.
And look now, the prices are falling like a rock and there is no end in sights for the fall.
I am not at all dreaming about a property crash as I do not have any plans to purchase in Spain. About the helish nightmares, those will belong to the people who got into debt up their eyes, I am more that well prepared for any kind of disaster might be around the corner.
It is really impossible to see in May 2007 what the future years will bring, we just need to wait.
I’m a well-informed optimist, i.e pessimist.
I have been posting for quite a few years now and I always said real-estate prices would fall moderately. I’ve never posted prices won’t fall, ever.
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@Drakan wrote:
@mike wrote:
That suggests that there was two digit inflation at that time so in real terms maybe house prices didn’t go up at all some years
Correct. There was even a decrease in prices but no-one talked of an asset bubble such as now.
Thanks, Drakan. By real figures I meant after adjusting for inflation. You seem to agree by saying that adjusted for inflation prices dropped at times in the early 90s. Just clearing that up
With Euribor rates at 4.3% I was being optimistic with my figures. I’d like to do my sums again with realistic current figures
Let’s say that I earn 1.540€/month net.
Now, if I wanted to buy an average property in Andalucia that would cost about €150K. Lets say that I have the 10% in transaction costs saved and a €10K deposit so I will have to borrow €140K.
Euribor is currently 4.3% and let’s guess that banks add 0.2% on top of Euribor. Is that realistic?
so that means I would pay €6300 per year and €525 per month leaving me with €1015/month which is quite reasonable. But if I actually chose to repay the capital over 25 years then it would cost me €786.78 per month leaving me with €753 per month to live on which isn’t quite as attractive and over half my salary goes on buying my house with no contingency for repairs.
A quarter percent increase in interest rates would be significant to me. Lets hope there is not a worldwide shock such as a war in the middle east! 😕
@Drakan wrote:
Ja, ja welcome to the problem most Spanish youths have. And that is providing you make 1.540 which is high salary for Spain if you are below 30 y.o.
So, like in the UK, there is a problem for Spanish youth wanting to buy property. If such a situation were to remain then society would have to adjust in some manner and that might not be pleasant with a Europe full of disaffected youth.
@Drakan wrote:
@mike wrote:
The above is what I forsee which is why I compare it to 1929 because…..
Heh, 1929. Those have been my thoughts over the weekend. The “irrational exuberance” springs to mind.
Easy-credit is the smoking gun, interest rates the trigger and greed pulls it.
Back in 1991 in the last crisis people complained that houses weren’t selling, no-one spoke of a bubble . Nowadays everybody wherever you go, from Australia to Ireland (specially here), California, France etc.. everyone acknowledges there is a real estate bubble brewing. Only banks and finance ministers deny it along with developers of course.
I think last week, exactly last Tuesday the 24th April, we moved on from the “denial stage” (“there is no bubble”, “RE prices never go down”…) to the “uneasy stage”.
Who knows ? 😉
I’m not going mad then, the world has gone crazy! Phew! 🙁
Thanks very much Drakan in helping me through my thinking.
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@mike wrote:
that adjusted for inflation prices dropped at times in the early 90s. Just clearing that up
With Euribor rates at 4.3% I was being optimistic with my figures. I’d like to do my sums again with realistic current figures
Let’s say that I earn 1.540€/month net.
Now, if I wanted to buy an average property in Andalucia that would cost about €150K. Lets say that I have the 10% in transaction costs saved and a €10K deposit so I will have to borrow €140K.
Euribor is currently 4.3% and let’s guess that banks add 0.2% on top of Euribor. Is that realistic?
so that means I would pay €6300 per year and €525 per month leaving me with €1015/month which is quite reasonable. But if I actually chose to repay the capital over 25 years then it would cost me €786.78 per month leaving me with €753 per month to live on which isn’t quite as attractive and over half my salary goes on buying my house with no contingency for repairs.
A quarter percent increase in interest rates would be significant to me. Lets hope there is not a worldwide shock such as a war in the middle east! 😕
Yes in “real” terms.
Actually 12% for transation costs on the purchase price, 10% is without a mortgage, if you are applying for a mortgage.
Property at 150k in Andalucía ? Are you thinking buying inland or rústica ?
Actually if you are shrewed and the declared purchase price were 130k instead of paying 7% ITP tax (if it’s a resale) you would pay only 3,5%. But you must be below 35 y.o. to apply for this tax relief and if you are buying in joint names this still holds true for your couple providing he/she is below 35 y.o. and would be applicable at their 50% quota on the property.
You have only 10k and expect the spanish bank to finance you with 140k ? I find that very difficult. Spanish banks normally lend up to 80% of appraisal value to Non-Residents, although naturally some valuers will overvalue your property so that numbers add up for you…not advisable really.
If a quarter of a percent is significant to you my advise is not to purchase now and wait for a fall in prices.
Banks and investors alike are discounting that we will end this year 2007 with Euribor at approx 4,75 % and we will probabbly end 2008 with Euribor at 5,40% or more.
mortgage calculator:
http://www.finanzas.com/calculadoras/previsionhipotecaria.asp?idtipo=1
In fact the BoE willalso be raising it’s rates from 5,25% to 5,5% due to increased consumer spending.
You should never be spending more than 20% of your salary in a mortgage repayment as in done in germany etc….
Spain, being Spain, is of course somewhat different. Banks will lend you up to 40% of your salary and many young spanish couples are actually allocating 80% of their salaries to their monthly mortgage. Absolutely crazy and financially irresponsible.
Whose to blame ?
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Personally I don’t know what burbajista is but I will have 5 bob each way anyway.
The one thing is clear as far as I can see is that there is no direct reason for calling it an official price crash or property bubble that has burst.(yet)
Lots of guessing and looking at various data showing historic results but really think the world is a far bigger market today and in particular currencies namely the euro etc and the ability to vary interest rates.
Just because fund some fund managers were overweight in property and sold stock off and sent a reaction through this sector has perhaps not as much effect on prices as some would have us believe.
It has been pointed out that on this site they have a seen property at say 185,000 euros when it should be 210,000 euros and I wont mind betting that if you enquire it will be sold if not then maybe you have a bargain which applies anywhere.
We can’t have a realistic view on what property prices are until this whole situation is resolved and property values stabilize then and only then can history tell us what this period tells us
As many say if you can second guess the market and be 100% correct then you are a genius as there are too many variances that can through even the most pessimistic or optimistic forcasts right out of the window.Regards
Jim 😀 -
@glassman wrote:
Lots of guessing and looking at various data showing historic results but really think the world is a far bigger market today and in particular currencies namely the euro etc and the ability to vary interest rates.
This type of flawed logic is what leads people ultimately to bankruptcy Jim, that and greed.
1929 stock crash, an “expert” days before: “stocks are reaching what seems like a permanent plateau”
2000 .com crash: “irrational exuberance” “traditional valuing tools of companies are no longer applicable” yeah right. 🙄
2007: “Hedge funds are weapons of financial mass destruction” Warren Buffet. No need to explain who he is.
When China changed its fiscal policy to tax stock capital gains almost the next day the Dow Jones fell 5%. One of the largest falls since 11 sept 2001. Fact.
The World financially is ever a smaller pond Jim and there are just too many chain linked credit and insurance underwriters …
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Hi Drakan
Looks they made their call and were wrong.OOPS ❗
Perhaps they were basing them on historic figures?
If fund managers used just historic figures to be right every time then funds would never fall.
As is said in many cases ,investments are something that no one wants and then they become undervalued.
Its those clever sods that can see the opportunity that really make the money and this will happen again in Spain but if anyone can make this call as to when and be 100% correct then its going to be a very good result indeed.My opinion,agree on the greed though
Jim 😀
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Drakan wrote:mike wrote:You have only 10k and expect the spanish bank to finance you with 140k ? I find that very difficult. Spanish banks normally lend up to 80% of appraisal value to Non-Residents, although naturally some valuers will overvalue your property so that numbers add up for you…not advisable really.
That is my main worry about Spanish property. I was in both Tenerife and Fuerteventura and I looked a bit at properties and everybody was offering me a 100% mortgage + closing costs covered. And they were
known agencies, not cowboys… -
Drakan wrote:The World financially is ever a smaller pond Jim and there are just too many chain linked credit and insurance underwriters …
Do forget David Lereah, the boss of the US realtors (he was just replaced): Buy now of be priced out forever, they are not making any more land, property prices only go up.
This is what created the histeria in USA, with people waiting 3 days in line for off-plan condos. But guess what, when finished the same condos cost $150K less.
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Hi All.
I have had it said that I am in denial and have my head in the sand (Ostrich head comes to mind) 😀 when I try to put forward views that at try to balance out many of the negative postings regarding Spanish Property..
The majority on this forum are a lot more intelligent than I am with the in depth knowledge of history and facts and figures but I try to keep life as simple as possible. 🙂
It’s very interesting at times to how many view their situation and how bad the forecasts are with reports on property crashes and evidence? Going back to 1921 looking at everyway to look try to forecast the future.
Many view the future as very bad however as far as my situation with say my property on La Reseverva, I ask my self the following.Money invested 70,000 euros
Interest paid or interest I could have received over
3 years at say 5% 10,500 euros = approx £7,500I choose to view this as my loss? to date so no matter what is supposed to be the on coming property crash this is my situation, and think many others.
Now what did I pay for the property? I haven’t paid for the property; I have only paid the above however the value of the property back then was supposed to be the contract price of 207,000 euros .
Now I for one was fully aware and I am sure many were more than happy to accept capital growth on the contract of 207,000 euros but can’t accept the loss of interest on the deposit. ( capital growth on 207,000 compound, bring it on!)
At the moment I am £7,500 down in the game if you want to look at it this way so what next.
1 Court action in place and may win and with interest may get the money back?
2 I loose the court case and then I complete or loose my deposit and that’s a fact.
3 I complete on an 80% interest only mortgage and rent the property out so covering a large percentage of my repayments.
4 I use it for holidays and family and friends.
5 I then wait until the double digit gains that even the most pessimistic forecast in say 5 years times.
6 I could attempt to avoid completion for as long as it takes to get an L.F.O if I can get away with it and it could be years ie towards the 5 years.
What’s my alternative? Worry myself sick and look for every possible negative 🙁 posting and then make myself worry more.
Took the same view when the stock market went from around 6,900 to 4,500 several years ago and on paper? I lost around £150K and watched as many cashed in at that point because of warnings that the markets would fall further so they lost.
However in a few short years that loss that I was supposed to have made is now back to and above the figures before the crash.
Now back to the Spanish Property situation?
If a similar property to the one that I don’t own yet fell by say 30% as forecast by some of the guys here do I assume that I can by an 83m2 apartment with terrace, parking storage and swimming pools in Marbella for 144,900 if that is the case I will have 4..( interest only of course) 🙂
Lesson I have learnt, sometimes you have to stick it out while others around you panic and employ people far more intelligent that you.Regards
Jim😀
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Hi Jim,
I fully understand what you are saying, and for you, your approach to your situation is commendable. You are obviously used to the ups and downs of the stock exchange/property market.
Now presumably you bought either La Reserva or Green Hills as an investment. ( why would anyone want two properties around the same area, for personal use?) But…not everyone has bought for investment. We certainly didn’t. We bought so that we had a holiday home for ourselves and family, and ultimately that we could pass on to our children and their families to enjoy. No way would we have rented it out.
Other people in similar circumstances as yourself bought purely for themselves, long term. Some of these people cannot afford to have money tied up in a property that they cannot use or is illegal. They would like their money back to buy another property that they can use and enjoy now. Some of these people are not young with plenty of years ahead of them. They are past retirement age, or like my husband and I, not too many years off retirement age. Investments, percentages etc do not make a jot of difference to them. It is irrelevant. Most of this thread has focused on money markets and investments either short or long term.People like Goodstitch, Suzanne and many others I could name just want their money back from corrupt developers. It appears from Court cases of late that, as Goodstitch so rightly said, the developers are saying that everyone is an investor and the judges appear to be listening to them…not the innocent buyer. 🙁
Just my opinion of course. 😉
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Hi Claire
Thanks so much for your reply and trust me I agree with everything you say and with things as they are I would also jump at the chance to have my money back.
I like you bought Green Hills as a future place to retire in and in the meantime use it for holidays as I luv the area( better to have money in something that I can enjoy instead of Gordan Brown having a slice in a retirement fund.)
My nightmare with La Reserva I think I have covered in previous postings and lets say It wasnt intended at first to be an investment but perhaps I tried to kid myself it would be and it was either that or loose money that I was owed.
While I would luv to have my money back and in particular La Reserva I really do have to face facts that this may not happen and have no intention of beating myself over the head ,trust me in the begining I did just that.
I am on every single one of the sides of Suzanne,Goodstich 44 and everyone that deserves justice but as we have said I just take the reality route and if that turns in my favour like all I would be over the moon ,if not I will deal with it is ways I have mentioned.Regards to you
Jokes ready for the weekend,tell hubby there are a couple of crakers
Jim 😀
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Charlie
Yep I am like a little lamb now, fully under control and reprogrammed. ❓ ❓ 😀 😈 8) 😉
Seriously I would be delighted for my dear wife and myself could meet you and I somehow think or hope you would be in for a pleasent suprise as long as your up for a laugh.Suzanne
Hi Gal . Yes but I have lost 25% of my property i,e the garden.Regards
Jim 😀 -
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Hi All
Think its time to call it a day posting on the forums and I am sure many will have a glass or two in celebration. 😛
Never seem to have been able to portray the real me and its clear I will never be a welcome member no matter how hard I try.
Please keep up the fight for the many that need help and support and understand that this is now changing due to the problems overall in Spain and not confined to one development, or area.
Wish I could say that I met a few friends along the way but one thing can be said is that I am a stubborn so and so as many of you have probably said about me amongst other things.
The Spanish will find out just how stubborn this guy is 😈
Wish you all the very best.Over and Out
Jim
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And for all the die-hards out there who are still in a state of denial on how property prices are falling in Spain -gasp- (it’s in Spanish):
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Today’s ‘Sur in English’ article: Fall in demand set to force closure of 75 per cent of estate agencies
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I think it is generally accepted that for certain types of property namely one and two bedroomed apartment blocks in over built areas,with all the issues that are regularly discussed on the forum affecting them. Then clearly the future looks bleak.
However it does appear that the Spanish property market is made up of many different property layers ,within the last few months people who we know have made the decision to move, one couple who live in Spain have sold up in Denia and are in the process of moving to Riopar in Albecete,this I found unusual in that they had an established property in a good area ,but found that over the years the town had becoming more built up and busy ,I do not know this region (Riopar) but when I saw the photos ,It soon became apparent why their research had led them there ,stunning mountain scenery and quaint Spanish villages.The second couple I think represents the now firmly established second wave new comers, who despite having coastal family connections have eschewed these areas, for property inland ,listening to their reasons ,invariably they quote the perceived better quality of life ,cheaper too ,that can be found away from the coasts .Time will tell how these second lifers fare ,but one thing is sure, they are both convinced that they are making the right move ,interestingly in both cases they will be following friends who have already made similar relocations
Spain is a large varied country that can offer a huge range of properties in all price bands, consequently it may in real terms ride out the property slow down better than expected.Trends come and go but there does seem to be increasing interest in environmental issues ,which could be influencing peoples decisions to explore a potentially simpler but ultimately more enriching way of life for them and their families .Due to Spain’s agricultural heritage there does appear to be a surfeit of Finca’s and Casa’s rural ,which may soon find new owners from the now almost dis enfranchised younger families who are seeking a home and a life style which will never be available to them in the UK ,at a similar level .
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Katy, As I mentioned I do not know the area although it does look stunning from the images I have seen ,as for Jobs the young family are Ok ,as he is a builder and via a recently relocated friend have formed a company and have already landed a couple of large jobs,
The other couple are quite enterprising in that they have helped set up a small local cooperative ,and now export olives and high grade olive oil back to the Uk for sale at farmers markets and small independent Deil’s,produced from the other Finca’s that neighbour their own.I think to be fair they have found it hard work but have enjoyed their experience, learned a great deal and are looking forward to the next harvest They are busy at the moment developing new outlets and products.I know it sounds like tough going but as they have explained there is a great deal that they will doing differently next year so it will get easier as they learn the ropes
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