There have been rumours about this event for some time. I will believe it when I see the results. CAM and BBVA tried something similar recently but it failed.
The reason for that is what the banks deem as ‘priced to sell’ and what investors see as fair value in the current market climate are two different things.
To invest in this market now, particularly in multiples involves unacceptable risk. So sale prices need to reflect that. Even with drastic reductions I don’t feel there is any appetite for it.
The world economy is slowing and property is lacklustre almost everywhere.
Even most clued up holiday home buyers are aware it’s not a good idea. Rents are falling and there is massive oversupply in Spain.
It will be interesting to see if Santander comes up with anything different.
If you look at plummeted property values in parts of the USA, particularly auction prices achieved you can see property is a toxic asset.
The problem for most banks in Spain right now is what to do with their toxic property assets. The government are desperate for private investment in the Caja’s to save their bankruptcy or nationalisation.
Bob Diamond came over to Spain this week for meeting with Zapatero who tried to convince Barclays to buy a few. The rumour was CAM was attractive to them. However it seems to have fizzled out. Probably when Diamond saw the books! 😯