Tinged with Regret

Finance
Thursday, February 7, 2013

Later we went back to Carlos’s office to discuss finance. MRI's financial experts were only too willing to tell us that we could afford whatever we wanted and we chose to believe them. They explained the expenses that we would accrue like taxes and fees and assured us they could arrange a loan for us to buy. The adviser scribbled it down something like the following:

Purchase Price €201,000

Reservation €6,000

20% Deposit €40,220

7% IVA

Legal 1.25 + 16%

Completion 2007 January

80% mortgage

7% IVA

1.8% Stamp duty

Notary & registration

We weren’t sure what all the things meant, but we thought we would have enough to cover the total balance and that was the main thing. It wasn’t like buying property at home. It seemed more complicated with too many expenses that we didn’t quite understand. An initial deposit of €6000 was required to secure the purchase and Maurice took out his credit card and handed it over. The exchange rate at that time was quite good and it converted to about £4200. I was thinking have we done the right thing and I texted my daughters to tell them the news with the hope of reassurance. They were both very non committal. It did seem like a good opportunity to us and a wise investment. We were in our 50’s and we could keep it for a few years and then sell it for a profit.

The financial adviser said that he would contact a local bank about our mortgage and would communicate with us by email to keep us informed of the progress. It would be an 80% mortgage so we would need €40,000 deposit. That would certainly give us something to do with our savings.

We met again with the after sales person, Helen, who explained how she would update us on the building progress and arrange the delivery and fitting of the furniture when we had decided on our choice. If we decided to furnish our apartment without the help of MRI, we would need to go to different furniture shops, arrange delivery and set up everything ourselves.

We were then passed to the rentals person, Natalie, who explained how MRI would look after the apartment and have it rented out on our behalf, organise the laundry and the cleaning and take a percentage of the rental. We were given literature with detailed projected figures and costs and we went away with our heads buzzing.

Example – 2 bed 2 bath, well furnished, qualify appliances

High Season Rent

€700 / week rental

€ 70 – Commission (10%)

€ 50 – Property Clean and Preparation (2 bed)

€ 20 – Welcome Pack (tea, coffee, sugar, milk, orange juice, water, eggs, bacon, bread,

butter, toilet roll)

€ 15 – Linen change (per room)

€535 – Net Income to the owner per week

As we sat on the balcony of our hotel room that evening we hoped and prayed we had done the right thing. We were going to be Spanish property owners and what could be wrong with that?

We took a taxi to a restaurant at Mojacar Commercial Centre which had also been recommended by Carlos and in fact met up with him and a few of his colleagues for a drink before we enjoyed another good meal that evening.

We flew home the next day. We now had a Spanish solicitor, a financial adviser and a substantial deposit to pay so that the mortgage could be arranged. The apartment was to be completed by January 2007 and we were hoping to spend our first holiday there later in the year, perhaps April or May. We had so much to look forward to and hopefully not regret.

We were still very unsure that we had done the right thing and we could have refused to continue with the sale by forfeiting the initial deposit of €6000 but who wants to throw away money, so we continued.

In the weeks that followed, the mortgage had to be arranged and the expenses kept increasing. I realised that our advisers had been somewhat economic with the truth about the expenses which were going to cost us much more than we originally thought. Even though I complained about this, nothing could be done and we had to find the money. We discovered that the best way to send money abroad was to use a finance company where we could buy euros for pounds and have them transferred to a Spanish bank account. The company would secure a rate for a period of one or two years and money could be transferred monthly. Psychologically, it wouldn’t be an easy task to withdraw the initial large sum of money from the bank and send it abroad but that’s what we would have to do. I was in continual email correspondence with the Spanish solicitor and the property company as I tried to understand the process.

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Finding the right place
Tuesday, February 5, 2013

The next morning Carlos was on the hotel doorstep again waiting to take us to more potential holiday homes. I hoped he had got the message by then. Theoretically, we wanted to be near the beach, we were happy to drive to the golf courses, we would like a few restaurants close by and we didn’t mind it being quiet. He took us to the sales office of Los Altos de Nuevo Vera where a plan of the complex lay across the table in 3D. It was built close to the last one we had viewed and just a few minutes’ walk from the beach and consisted of 4 storey buildings with lots of different sized apartments. There were to be 3 swimming pools surrounded by the apartments, large carparks and gardens, a children’s playpark and secure gates manned by staff. It was great and we were interested. Alongside the office there was a fully furnished show apartment with all the appropriate finishes and styles. It was lovely! The first 2 blocks had been built but were not yet occupied. I supposed that this was what was known as buying offplan. However Maurice had no intention of buying something he couldn’t see, so he insisted on visiting the site.

Carlos took us to the apartment block but due to health and safety reasons no one was officially permitted on the premises. As we got out of the car I told Carlos to look the other way and we left him sitting outside the building site. We ventured carefully up the rough path covered in building materials and stones to find the apartment we had liked on the plan.

I was thinking that I needed to see what way the sun shone on the property and Maurice wanted to get a feel for the place. It was rough and unfinished but it certainly had potential. It was a 2 bedroom, 2 bathroom ground floor apartment with a lounge/dining room and separate kitchen and utility.

It had a large terrace that opened on to the garden and swimming pool. The tiling was not completed in the swimming pool but hedging and palm trees with protective covers had already been planted and not much imagination was needed to visualise what it might look like finished. Oh yes we could see ourselves enjoying the sun on that terrace! When we returned Carlos was being upbraided by a security guard for letting us venture on to the site, but the damage was done as we had seen what we needed and we were excited.

We also needed time to think so Carlos took us for lunch again. I wanted to talk to Maurice alone and he wanted to talk to me but Carlos was there suggesting this and that and discussing the pros and cons. After lunch Carlos drove us back along Mojacar Playa and to another apartment block close to a golf course and overlooking the sea. The position was almost ideal but it was accessed by a long steep hill which would have to be climbed on a daily or nightly basis unless we used a car. We agreed that the view was not worth the inconvenience of the hill climb.

As we travelled in the car I could see Carlos watching me from time to time in the rear view mirror. I wanted to close my eyes and go to sleep as this was all too much to take in, but I needed to think it out and talk to Maurice.

We decided to return to the sales office of Los Altos de Nuevo Vera to look at the options of the only complex we had liked and give it proper consideration. There were different apartments and different prices. Unfortunately no one there spoke English so Carlos had to translate for us. I thought that they always seemed to say more in Spanish than the English translation and I wondered if we were missing or misunderstanding some things. The apartment we chose was €201,000. A long time was spent indoors waiting, wishing we were in the sun, wondering if we had enough money, worrying if we might do the wrong thing.

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Tinged with Regret
Monday, February 4, 2013

It was 2006 when the house prizes were at their height and the economy seemed to be thriving. We had paid off our mortgage years before and had accumulated savings over the years. We were in our 50s and both still working. Our children were married and we had nothing to spend our extra money on except holidays and luxuries. Like thousands of others I had watched “A Place in the Sun” on the television and thought it would be wonderful to have a holiday home abroad. I had seen the property exhibition advertised for days and yearned for just a look at what was available. It was in a venue not far from our home but my husband was away on business and there was no opportunity to go. Then I got a phone call from him to say he was getting an earlier flight home on the Friday evening and somehow I persuaded him to go to the exhibition.

It was run by MRI, a large property company and they were selling properties in various places abroad. We had a good look around. The photographs of the sun drenched beaches and the sophisticated apartments and villas were alluring. We were happy to look, pick up brochures and read.

One that did take our fancy read - “South-East Corner, Andalucia – Wedged between the Sierra Nevada mountains and the Mediterranean Sea, the Costa de Almeria was bypassed in the 1960s holiday boom because of poor road connections. As a result, it is less touristy than some of its neighbours. Expect white-washed buildings instead of high-rise hotels and some of the most relaxed beaches in Spain. Resorts enjoy spectacular settings as well as the hottest summers in the country. Almeria, the capital, offers impressive sights including the fortified Cathedral and is overlooked by a magnificent Moorish fortress, the Alcazaba. There is also a stunning 16^th-century cathedral fortified to withstand attack from Barbary pirates. Fishing villages have developed into flourishing resorts. Mojacar and Roquetas De Mar are the most popular with fine beaches, palm-fringed promenades and seafronts lined with restaurants and lively bars. Landscapes inland are rocky and herby, while the almost lunar-like expanse of the Tabernas Desert have appeared in films, including Lawrence of Arabia and Indiana Jones”.

We were just about to leave the exhibition hall when we were stopped by one of the representatives asking if he could help us further and offering a “free weekend” to view our favourite area. Before we knew it we were investigating one of the resorts on the Costa Almeria. The resort was Vera Playa in a developing area which was now accessible by good communications and travel networks. This appeared to be a great investment as it would appeal to those wanting a holiday without the concrete jungles, lager louts or fish and chip shops and it was anticipated that it would develop with new shopping centres, sports facilities, bars and restaurants.

We just had to pay a cheap flight to Alicante and MRI would pay the accommodation and arrange for someone to pick us up at the airport and show us around. I told myself that I really didn’t have any intention of buying a property. I just liked the thought of it, a bit like window shopping. I stupidly thought it would be a long weekend break in the sun, catching a few rays and enjoying the scenery.

We arrived in Alicante on a Thursday and were greeted by a tall dark handsome Spaniard called Carlos. It was in November and the sky was a perfect blue and the temperature was pleasant. His English was good, our Spanish was not. He drove us south for 2 hours quizzing us now and again about our desires and intentions. My stubborn streak was saying that I had no intention of buying, but I'd go along with it anyway. Maurice, my husband was in buoyant mood.

Carlos was taking us to our hotel, but on the way he decided to show us a golf resort, as we are both keen golfers, to see what we thought of a property there. It looked remote and far from anywhere. The apartment was nice, the golf course looked good and the adjoining hotel impressive enough, but it seemed isolated and a million miles from the beach and civilisation. Our first impressions were not good.

We checked in to our Mojacar hotel, unpacked and had a look around. It was a large tourist hotel and one of several similar hotels in that area. It was clean and adequate for the purpose and I felt more like I was on a sunshine break. We had a late lunch and waited for Carlos who was collecting us again for a 5 pm meeting at his offices on Mojacar Playa.

We arrived at the property office and were greeted hospitably by the staff. We were introduced to the financial adviser, the rentals expert and the after sales consultant. It was all too much information in a short space of time and we both felt somewhat overwhelmed. Carlos offered to take us into Garrucha, the nearby fishing village where we could have dinner. We were delighted when he told us he would collect us again later and that he wasn’t joining us to eat. I was beginning to wonder why I had persuaded Maurice to start out on this venture. We enjoyed locally caught prawns at an exorbitant price in a restaurant overlooking the harbour. It was good!

Bright and early the next morning Carlos greeted us in the hotel reception area. He drove us along Mojacar Playa bypassing Garrucha to the Vera Playa area to look at more complexes where the apartments were well priced and where the staff spoke English. Newly built apartments could be purchased at prices ranging from €180,000 to €195,000 and they came complete with a furniture package which included bed linen, towels, kitchen utensils, etc. They were small but adequate and we were not impressed.

Carlos was eager to show us more properties and took us to another complex which was in the hills, a good 20 minutes drive from the beach. It had a sports complex with gymnasium and sauna, indoor and outdoor swimming pools and restaurants on site. We weren’t impressed with that either.

Carlos suggested a snack lunch. The conversation at the café was stilted at times and I was itching to lie on a sunbed but that was not on the agenda. The nearest I got was when Carlos drove down to show us the beach – metres and metres of deserted golden sand with wooden walkways stretching from the promenade almost to the sea enticing the sun-worshipper to spend time there.

We admired the apartments close to the beach so Carlos made a few telephone calls and arranged for us to see a front line property which had been sold some time before but the sale had fallen through. It was a well presented gated complex called Los Jardines de Nuevo Vera but the apartment looked unloved and neglected probably because no one had lived in it. The door knobs were rusting, the small garden was overgrown, there was only one bathroom and we thought it was over priced at €230,000.

I really thought that Carlos was probably frustrated with us as we didn’t appear to like anything he showed us, but he was patient and did not intend giving up on us. He suggested going back to the office to check on more properties. I would have been happy to have been left to sit in the sun.

Carlos made his plans for the following day and eventually he took us to our hotel, explained where we could eat out and left us for the evening. What a relief! We were able to enjoy the evening sun on the balcony of our hotel room and have a rest before we went out. At that stage we definitely had no intention of buying anything but our dinner!

We always love to eat out on holiday and try new dishes so we walked quite a distance to a beach side restaurant called Neptuna which Carlos had recommended. It was a large wooden building decorated with lanterns and bamboo with a large red hot barbeque burning at the entrance. We enjoyed freshly barbequed fish washed down with a bottle of chilled white wine. We asked the staff to ring for a taxi but were told that all the taxis would be at the airport that evening to collect holiday makers, but one of the staff would give us a lift to our hotel. How unusual!

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