Economic decline in England and the weak pound - We are now struggling to be able to complete.

Since our original visit in May 2007, when we fell in love with the idea of a second home in the sun, and commiting ourselves financially to making it happen, we now find ourselves in a situation where it is becoming increasingly obvious that we may have to walk away from the dream and lose our 25%.

The housing market in England has collapsed, with our home being devalued on a regular basis, therefore raising the finance to complete is now nearly out of reach, as the equity in our home is that much less.

This, in conjunction with the very weak pound, which has recently dropped yet again, means that the apartment price will be 25% more than  we originally agreed.

Are there other people out there experiencing the same problems, and if so does anyone have any ideas ????

Clive & Sue Hemingway

I am sorry but there are hundreds of people that face the same dilema as you. We receive lots of e-mail every single week from people asking how to cancel contracts that they cannot afford for a variety of reasons and i have done lots of research on the matter with lawyers, developersmand agents.

As I have mentioned before I have no interest here as I do not sell property only carry out the inspections for clients and provide advice

I feel sorry for both buyers that have this problem but also for the builders who are building the properties, who have sold them in good faith and with who you have a valid contract that can be executed legally.

i am not sure what you have bought but I understand that it may be posible at UGR to move to a later phase or a smaller property, again speak to your agent or the builder about this.

What people don´t seem to mention is the reduction in interest charges on mortgages which offset some of the currency variation, my own mortgage is Spain has reduced by over €150 per month recently and is still reducing plus lots of interest only deals

There is lots of advice on this forum and I know that if you spak to UGR they will tell you that you will loose the deposit

There is some consumer law in Spain that, if you are unable to obtain a mortgage or suitable mortgage, based on the valution, which may have reduced since the original contract, that you will able to obtain a full refund but this can only be executed when the property is ready

All I would ask is to remember, when dealing with these types of issues is that, although builders should take some responsibility for over development thay have no control over the interest rates, property pricing and the rate of the euro

On UGr, unlike the locak resort of La Tercia Real, they are actually still building the development, the clubhouse and shops etc

I am sorry but there are hundreds of people that face the same dilema as you. We receive lots of e-mail every single week from people asking how to cancel contracts that they cannot afford for a variety of reasons and i have done lots of research on the matter with lawyers, developersmand agents.

As I have mentioned before I have no interest here as I do not sell property only carry out the inspections for clients and provide advice

I feel sorry for both buyers that have this problem but also for the builders who are building the properties, who have sold them in good faith and with who you have a valid contract that can be executed legally.

i am not sure what you have bought but I understand that it may be posible at UGR to move to a later phase or a smaller property, again speak to your agent or the builder about this.

What people don´t seem to mention is the reduction in interest charges on mortgages which offset some of the currency variation, my own mortgage is Spain has reduced by over €150 per month recently and is still reducing plus lots of interest only deals

There is lots of advice on this forum and I know that if you spak to UGR they will tell you that you will loose the deposit

There is some consumer law in Spain that, if you are unable to obtain a mortgage or suitable mortgage, based on the valution, which may have reduced since the original contract, that you will able to obtain a full refund but this can only be executed when the property is ready

All I would ask is to remember, when dealing with these types of issues is that, although builders should take some responsibility for over development thay have no control over the interest rates, property pricing and the rate of the euro

On UGr, unlike the locak resort of La Tercia Real, they are actually still building the development, the clubhouse and shops etc

Hi to everyone,.   I live in Spain and have done for three years now.  To anyone who is also considering either buying a second home in Spain or actually moving there, my advice is DON'T!      Bite the bullet and stay where you are.    As lovely as living is Spain is (or once was) property prices have gone into freefall: there are no buyers, not even viewers: the cost of living is also increasing substantially in Spain, and what is now the real killer, where but one year ago, people received €15 for £10, now they barely get 11.      To put it into even more context, if you were paying €1000 (£650) pa to be a member of a golf resort, now that same membership costs you virtually £1000.   There's exclusive Clubs in UK that charge less.    To now live reasonably well in Spain, you need a DISPOSABLE income of no less than £2000.  Less than that and you'll struggle, and when it comes to either Developers or even Solicitors, you don't have the same protection as in the UK, AND you're dealing with unknown preactices.

A sad expose, but unfortunately now true.    If you are thinking about buying in Spain, firstly read every posting on every Forum that you can, and reap the benefit from the disallusioned.

Hi

I am just interested why you picked this particular development to post this message - is there any particualar reason?

Yes, Sandrab, it's topical - read the post from Clive & Sue Hemingway.   Also, many people who now live in Spain tend to read Forums from many developments, and add their own experience, help suggestions to those people who solicit them.

Finally, if you haven't read this week's Costa Blanca News, do so - it's quite revealing, and will be of interest to a (sadly) large number of people.

Have a good Christmas

I cannot quite understand finkies why you have chosen to postt your comments on this thread and not the main general topic

First of all there not sure what you men re the articles in the CB News, there´s one about the problems at LA TERCIA REAL which is nothing to do with this La Tercia and a few about people suffering with the credit crunch, pretty similar to the UK stories

I have lived in Spain for 5 years, have been lucky to start a business, not selling property,  which is working well but fuuny the harder I work the luckier I seem to get

Now I know that if I was trying to live on a pension that I would be struggling, lots of people are, but I came to Spain knowing that I would have to work and alwys have

I accept all of the comments about rising cost of living, but this is offset by the fact that my mortgage will be 33% cheaper next year due to the falling interest rates

Yes I can´t sell one of my properties but I have had it 4 years and it rents out well so I am not fussed and I could probably sell it at a loss if I was desperate, lots of people are 

Most food items are cheaper than the UK providing you know how to shop, the Spanish way, eating out is cheap, if you know where to go, and I pay less for road tax, my rates are €60 a year and I am still getting the same sterling amount for renting out my properties

I pay more in NI but less in Income Tax and get a Spanish Pension in 15 years

I have no TV license to pay, I spend less on heating, I spend a lot less on travelling, very few traffic jams, less

You do´t need to join a club to play golf as the charhes for pay and play at local courses reduces every week, how about 9 holes for €10

Yes some lawyers are  problem, I deal with the problems everyday, but again apply common sense

Finally I do agree with one comment, unless you have enough money to live without working, a skill that is needed or you speak Spanish, don´t move to Spain

Well, Inspectahomespain, rivetting as your Post is, my comments were primarly addressed to Clive & Sue Hemingway, who had posted on this very Forum. To Clive & Sue, and not to just a few people, but to all the other thousands of poor people who are 1000 miles away: in the same position, and desperate to ascertain exactly what the true situation is.

But to deal with your points in order.

By my reckoning, and just from various reports, there are in excess of 30,000 people, mainly British & Irish, who have paid somewhere in the region of €40,000 as a deposit on a property where either the Developer has sought protection from paying creditors, or has simply gone Bang, and disappeared - leaving no-one to explain matters to all the people who will now never see either their property or their money back.

And it's OK to trot out platitudes, even Duck-Billed platitudes about the harder you work the luckier you get. Most people here fall into two categories: they either bought in Spain as a second/holiday home, or they are retirees. In neither case are they able, or indeed can work, and in the latter case, they rely on some form of a pension income, which has currently decreased by around 30%.

Most of the first category are also supporting a mortgage on their main home in the UK as well. And interest rates have gone through the roof there: the general cost of living has gone into orbit: all sectors of financing are reluctant to now lend, and even if owners could find someone to grant them a second mortgage, property values have also dropped like a stone, so they have less equity to play with.

To cap it all, with the disparity between sterling and the euro, owners who have laid down deposits in Spain, and will eventually receive their property, now have to find something like 30% more because of the disparity.

Due to the colossal glut of unwanted properties in Spain, values here have also dropped - by 40% in many cases, and there's no buyers: not even viewers at the moment. If you genuinely believe that if things got desperate, you could sell one of your properties, then just pop it on the market, and see what interest you get - even at a criminally low price.

The cost of living is rising in Spain, and again due to the disparity between sterling and the euro, anyone who's income emenates from the UK, is even worse hit than the Spanish, and they too are struggling financially - check and see how sales of new cars here have dropped by around 50%, and completions of properties by the same percentage over the past year. These figures speak volumes.

What one pays for road tax depends on the model of one's car: what one pays for IBI (Council Tax) depends upon the value of their property and where they happen to live. I've just been presented with a Demand for €180 for our smaller property, which is 1/3rd of the size of the property in which we live.

I speak Spanish and I eat at Spanish restaurants, but what one pays is dictated by how simply one eats - not where one tends to go.

I agree that heating bills are much reduced from the UK, but to compensate, whilst one uses the heating in the property for perhaps 3 months, the aircon tends to be used for 6-7 months, and that is just as expensive.

As regards Golf, hundreds, if not thousands of people in the area where I live initially (in their ignorance) bought on Golf Resorts and purchased Golf User Rights, anywhere from €20,000 up, and, again in their ignorance, are obliged to pay membership fees of around €2000 pa. And whilst this was possibly acceptable to pay the equivalent of £1300 to many holiday-only owners, due to the disparity, this is now costing them almost the same amount in sterling. People who paid that little/a lot extra to live in what was euphamistically styled as 5* Golf Resorts, now find that they are caught in a web that is not of their own making. Indeed many people are suspending their memberships and voting with both their money and their feet when it comes to playing golf, but there is no such thing as "cheap" golf -at least not if one wants to play on a good quality Course.

It was, and is, still extremely difficult for buyers to "apply common sense" when it comes to dealing with lawyers.

They, to the average potential buyer in Spain, are an unknown quantity, and there is no such organisation as the Law Protection Society as there is in the UK.

I will give you but two examples: one well known, and extremely large developer "north and inland" went into voluntary protection. They had sold 95% of their 2500-odd properties. Very few of their buyers had VALID bank guarantees, and therefore have lost both their property and their deposit.

Just how many Solicitors advised these buyers that a valid bank guarantee was a MUST.

There are somewhere in the region of 1200 properties slightly n/w of Torrevieja. About 1000 are built on agricultural land (no licence) and the other 200 built on what is termed protected parkland. Just how many Solicitors dealt with these 1200 purchases, and just why did none of the buyers seem to be aware that there properties were under a very severe threat of a demolition order, or a let's-make-it-legal Bill of thousands of euros?

And to finish off this tale of gloom, although my Spanish is good, albeit colloquial and ungrammatical, and I'm virtually fluent in another two european languages, I am realistic enough to know that I would find it virtually impossible to obtain work here. In the present economic climate, it's totally impossible, as the Spanish always prefer to employ another Spanish person if this is possible.

Spain has already slid into recession: their traditional income was based on tourism and the building industry. Both are currently in dire straits.

It was for the above reasons that I warned against potential buyers risking their hard-earned money in Spain - at least until the economic climate is totally settled once again - perhaps 2-3 more years.

Argue against these points if you will, Inspectahomespain. Prove me wrong, I would really wish that you could.

Have a good new Year.

I actually agree with a lot of what you say however not everything as it seems in your case that your glass is definatley half full and you seem to ignore the 10´s of thousands of people that hve a successfull and happy life in Spain

I also am very aware of the issues as in business I work with people every day helping and advising them with issues about developers, contracts and how sometimes it is possible to cancel a contract and get your money back. 

As far as the builders walking away I agree, you it is unaceptable and you are probably refering to San Jose , Peinsa and Catral as the area with the ilegal builds but while people continue to ignore basic advice, which has been give for years including, don`t use a lawyer provided by the agent, don´t pay without a BG in place, if the property is very cheap and looks too ood to be true then it probably is,

If you refer back to the original post they asked what they could do to get out of the contract and the answer was the truth, not much, in the case of this developer not much, they re completing the properties, the buyers have BG´s. yes there are a few issues with the facilities but generally it is a good site.

The facts are that people have never been  forced to buy in Spain or the UK , or to  move to Spain, people did this because they wanted a lifestyle change and nobody could forsee th economic downturn

If you are employed and have a Spanish or English mortgage your payments have reduced substancially based on the Eurbor in Spain around 33% in 2009, the cost of living has started to fall, and with the lowering of VAT I m now travelling back to the UK to do some shopping with my euros but you seem to have ignored this fact, if you know where to lend money it is cheap

If you have a Spanish property and can sell if, yes there are still buyers out there if you know where to look, and want to move back to the UK, your euros are now worth 30% more so you can afford to sell at a lower price

The cost of living is not actually rising at a high rate in Spain in real terms as it is only rising if people keep doing the conversion from euros to sterling, I am still paying the same price for bread and other basic supplies and fuel in real terms is cheaper than the UK, at least 20% cheaper if you shop the Spanish way

I prefer to use real statistics so here are my examples 

If you have an inverter type AC unit they are cheap to run and if you are running it 6-7 months of the year is an exageration.  then perhaps you´re not a fan of the sun, my total AC bill last year for a 3 bed property was €480€

As far as the SUMA is concerned I run 2.5 litre newish cars, road tax €100 a year much less than the UK, on my 3 bed house I pay €80 a year, on the apartment €320 a year including the community charges, all much less than I was paying in the UK 

People always have free choice and they decided that the packges were good value and because of the pressure of the number of golf courses openning I disagree as there certainly is cheap good quality golf available, how about La Manga for €40 including a buggy,  but again it is not the developments fault that the sterling rate has changed so why blame them for the sitution

Now I am not sure where you live but I am in the Torrevieja area and with your skills there is no lack of employment opportunities working for both Spanish and English employers. If people approach it with a xenophobic attitude, rather than promoting yourself as somebody that is worth employing with good skills, then it will always be a problem and a lot easier to just moan. 

So in summary I agree that a decision to move to Spain is a touch one and you need money behind you to live but property is cheap, mortgages are lower than before, if you want to long term rent it is very very cheap, and for those people that want to get off their butts and work then a good living can be made

Actually, Inspectahomespain, being described as a person who's seeing a glass either half full or half empty, is an optimist's rather derogatory description of a realist. Let's just say that I prefer to regard myself as a realist - but I regard the glass as being simply 50% of capacity.

And this is starting to become a rather long-winded exchange of views between two (virtually) opposing opinions: neither of which help anxious owners or buyers in the UK. My wife and I have a happy life in Spain, but being happy doesn't deny the fact that our UK-based income has decreased by 40+%, or that both of our properties have decreased in value by the same amount. Or that our urbanizacion fees or golf membership. which one year ago, cost us 2/3rds of the due amount, now cost us almost 100%.

And putting the actual blame on the poor buyers is a somewhat uncharitable attitude: most of these unfortunates relied on the Solicitor or the Agent to keep them straight and legal, and whilst they may have had a rather naive trust in the ethics and morals of some of them, I still refuse to believe that every Solicitor who acted where people finished up with illegal builds, or without a Bank Guarantee, gave sound, ethical, honest advice, and the owners refused to be guided by it.

I have a very good friend (oddly enough with scruples and morals) who was an Agent, and he showed me the proposed contract with one well-known developer. If he didn't push a Bank Guarantee, he received 20% of the PP, as soon as the 40% deposit was paid. If he did push the guarantee, he received 10% after completion. Have a guess as to which option most Agents went for. With the same developer, if the Solicitor didn't push for a Guarantee, he received a second fee from the developer "as an acknowledgement" of the admin work that he had saved the developer. Add to that the fact that "some" of these Bank Guarantees were issued by Banks outside of Spain, and which were neither recognised or could be invoked by Spanish Law, and once again the poor innocent buyers were snookered behind the Green. It's not all that straightforward, even for people who have really tried to be circumspect.

Many of the people in question do not in fact live in Spain, they just wanted to own a holiday home here, and in their happy state of ignorance, assumed that there would be roughly the same degree of customer protection as there is in the UK or Ireland, Germany etc. That the equivalent of Planning Permission & Building Control, once granted, would not be revoked by a change of power in the Local Authority, or that permissions granted by corrupt officials would not still be honoured. That Solicitors would perform the same degree of "Searches" as detailed by the UK Laws.

No Sir, it's not all that easy to either explain away or to justify.

I don't fall into the category of forking out mega dinero to go jetting back to the UK, just because one can pick up the odd bargain there. That apart, being herded into a modern day version of the Black Hole of Calcutta for 5+ hours: renting a car in UK: paying hotel bills, simply to get a wedge of Vintage Mousetrap at half the price of Spain, is simply ridiculous - we eat Tierno instead - like wot the Spanish does. And we buy our bread from a Spanish Venta - but it's increased in price by 20% this year - ask any Spanish person if they think that the cost of living has increased.

My 2.4 car costs me €140 SUMA: my IBI totals over €400, and urbanizacion fees total over €3000, so all of these are just like happiness, it's all relative. You win some: you lose some, but it's all academic after the fat lady's sung.

I don't work, and I don't want to work - I've had my three score years and ten of working, and now I simply want to lie in the sun and fester. And I paid "that bit" (actually a whole lot) extra to live on a golf resort, as the density of build was so much less, and we look out on to golf course, rather than a crematorium, abattoir or a treacle quarry, because that was our choice, but neither the property or the location came cheap, and is becoming more expensive by the day.

And to conclude, we may live in a "desirable" location, but even so, property values have decreased by 40%, and there's still no buyers or even viewers.

Hopefully, current and future buyers will read our relative Posts, and decide for themselves. Perhaps as in most cases, the truth "may" lie somewhere in the middle.

inspectahomes at it again. how many rows have you started now. business must be slow

beadso in your case I actually achieved something as you actually started communicating and HELPING PEOPLE,, well done

 Perhaps there was some merit in my comments then, certianly helped a number of people get their deposits back recently

Perhaps my posts do acually help people

Happy New Year

First of all well done for at last saying that you enjoy living in Spain, something positive

finkie again for the record I agree with a lot of what you say about the agents, lawyers and builders as we live in a country Spain, where bribery and corruption is normal and open but it´s been there for years and going back over it doesnt help as what I try to do is help people to nit make the same mistakes and get out of these contracts

As I continue to tell people there is a little known law that if they can prove that they cannot get a mortgage due to the falling property value, or change of circumstances Spanish consumer law allow a buyer to cancel a contract and get their money

People hopefully, because of forum like this, now should know what to expect however this information has been there for years and also there are developers in the UK pulling out of developments and leaving people high and dry with unfinished developments around them and deposits paid where there is no completion date.

If you can prove that you have been badly advised by a lawyer it is possible, and I know people that have done this and won compensation, to bring a case agianst the lawyer or agent

As far as the reducing income and the global fall in property prices are concerned who´s fault is it, not the developers, not Spain´s but a global problem and again you excercised free choice to live in Spain

If I want to fly back to the UK and shop is cost me €20 for a day trip, €15 for a bus from Gatwick, Stansted, Manchester or Liverpool to the shopping centre and I can save a lot of money on certain items

In the Uk my car would cost me 185 pounds road tax, my fees as I explained are for a property 100 meters away for a golf course and 2 kms from 3 others

On the work front please don´t make unqualified statements and then stae that you don´t want to work as it gives an unfair image of the situation and the nation, as I previousy stated I cn prove that this is work for thsie that want to work

I choose not to live on a golf resort but in the community with Spanish and English people, you like anybody have the right to live where you live.

I have started my own business that is successfull, I have additional properties that rent well, please it is not all doom and gloom and it is easy to talk yourself into a depression,

inspectahomes before you started attacking me on another forum i had been helping other people so dont try and claim you where helping people. your a troublemaker.

Bit close to home hey bedso

You didn´t need to post the first attack on here so who´s the trouble maker and perhaps you should read all of my responses here

Read your quotes on the other forum until I made my comments you were not going to post anymore and I could send you some real interesting comments I got via PM´s re your postings

Please check out my articles and repution when it comes to helping people 

thats your problem your always right inspectahomes. to be honest i think your very immature.

 by the way inspectahomes everyone are entitled to their opinion, so stop trying to rubish people when they do. your so childish

Clive & Sue lets get back to your concerns, have you spoken with UGR directly yourselves about not completing on your property?  When are you expecting to complete are you in the 2nd phase purchasers.

Hope you can resolve your problems, UGR La Tercia will be something special.

Davey

bedso please go away unless you have anything usefull to say or perhaps, if you feel that I am doing something wrong, report me to Justin the owner of the forum, ilke you did on the other forum, which got you absolutely nowhere

Clive & Sue lets get back to your concerns, have you spoken with UGR directly yourselves about not completing on your property?  When are you expecting to complete are you in the 2nd phase purchasers.

Hope you can resolve your problems, UGR La Tercia will be something special.

Davey ( reposted just in case it got lost ) Seasons Greetings to all men and ladies