Happy New Year!........again

Hi everyone,
I am new to this forum but am concerned about my investment and was hoping to hear everyone elses opinions on Porto Fino. Before I start I dont want to ruin anyones enjoyment and excitement regarding finally getting these apartments.

I bought in Block 7 in April 2006. I have been to Porto Fino in April 2008 and must say I was very impressed with the lot apart from the fact the town was like a ghost town with not much if anything going on. I am supposed to be completing on the property now although I have been having problems with my mortgage and had to bring in my mother and father as guarantor.

This ment my mum and dad going over to Spain, where they are now, to apply for their NIE numbers. Heres for the concerning bit. They have spoken to two seperate companies who have advised us that the apartments have dropped in value quite consierably and that a rather speculative 80% would not be able to complete due to banks only giving a certain percent of value. This would mean us having to put in another 10-15% above the 15% we paid at the start.

I was advised to walk away as in the long run I would stand to lose much more if I take into account furnishing and on going monthly costs. One guy even said he could find us an apartment in the complex for 130,000 euros. I assume this is a 1 bed however as it surely couldn't have dropped nearly 100,000 in 2 years.

Does anyone have any knowledge on this issue? Either people who have already concluded or not? 

I appreciate any help.

Hi, The same is happening here in the uk, investors are walking away from deposits they paid 1 to 2 years ago,i myself am worried about Porto Fino,if i need to raise more cash to complete i will probably walk away .I dont know how many people will do this but there will be a lot of empty apts after everybody completes who are able to.
I havent seen any reduced prices advertised,only by people trying to sell before completion.2 beds are still priced at 250,000 plus.
This may change when all investors have either paid up or walked away from deposits,who knows.
Im 50,50 on this and dont really know  what to do.

I've seen 2 bed 1 bath apartments advertised for 170k in a local estate agents which is way below what I paid in April 2006.

Trevor

If anyone is having trouble getting a mortgage have they considered the builder's offer? CajaMadrid have provisionally offered us approx. 80% of purchase price at Euribor plus 1% which is not bad, all things considered. If you take the CajaMadrid mortgage you save on many of the initial costs such as valuation fee and some taxes as these have already been paid by the builder or are unnecessary.

The details of the offer are a bit sketchy to say the least but on the face of it the offer looks like a good one and apparently it's negotiable! I have just completed on a property elsewhere in Spain and took the builder's mortgage as the offer was better than other banks althoughI did have to haggle a bit.

Have also been offered a mortgage by CAM who have a branhc next door to Porto Fino but their terms weren't great.

Hope this helps.

Trevor

Ive,seen them advertised on the net,but i think they are from people trying to sell before they complete and get anything back before lose their deposit,
If they are the developers  apts selling for that kind of money then its very worrying.I cannot see this as no one would complete  if the developer was off loading at this price,my worry is when everything is finished and all paid up,what price would the deloper sell the remaining  100 to 200 apts that are still empty for.

I've been told by Proindal that the cheapest 2 bed apartment they are selling is 240k and that they will not reduce prices, which is good. I agree the cheaper prices must be buyers trying to offload before completion.

Trevor

Has anyone actually moved in then? Have they had it valued for mortgage purposes?  This is the bit that is scary as we have all bought for a price which might not be matched by the valuer. Or so Im hearing. I will keep my fingers crossed and hope all goes well.

Good morning, 

I have just got my first couple of cases in Porto Fino to binding offer stage, valuations in both cases were about 15% in excess of original purchase price with 80% of value mortgage, this equates to a shortfall of around 6% of pp on a 15/85 payment structure taking into account closing costs, in the next couple of weeks there will also be a sub prime mortgage becoming available that will allow coverage of full completion requirement with an additional insurance and higher interest rate.

Hi CB35. 

Can you give us an idea of when these apartments were purchased so we can judge more clearly our own situation. I would imagine that any one who bought in the very early stages would be fine but those who bought more recently would be struggling.

Trevor

Good morning, 

Quite correct, for those who bought later we are trying with a 90% of purchase price product that has an additional insurance and higher interest rate in order to try and negate the valuation issue, I will keep you posted as these come to fruition. 

We have today received our valuation report from Banco Halifax Espana. We are now in a state of shock! They have valued our 2-bedroom apartment at only 162,500 euros! This means that based on them offering us a 70% mortgage we will have to find one helluvva lot more money, but the scarey thing is, is that really what they are worth? If so then we just don't know now what we are going to do, we are absolutely gutted and can only pray that a mistake has been made.

Has anyone else had a valuation report like this?

Spondonites, This is exactly what I have been hearing from a couple of different sources. I am really concerned about this also as mine was 230000 euros 2 years ago when I bought it. How long ago did you buy yours?

Valuations are varying quite wildly depending on the block, bank and valuation company, as long as you can get a valuation at the purchase price it is still possible to get 80% and sometimes, 90% of that value.

Fifetim, we bought 2 years ago Mar for 233,000. So to ber offerred 70% of 162,000 is bad enough, but to think you are paying 233,000 for something that's really only worth 162,000 makes you feel really ripped off. How do you get the builders mortgage and how long does it take?

I have no idea about the builders mortgage, anyone any ideas?

In relation to developers mortgages, there are several banks involved in the financing of Porto Fino all offering differing terms and conditions, the benefit of going down this route is that you will save 2 - 2.5% in closing costs in relation to mortgage taxes, valuation fees and notary costs but this is only useful if the lender is prepared to lend sufficient LTV. If you contact the developer they will give you the contact details of the bank dealing with your particular block.

tgedge,
Trevor, have sent you a PM