Carrying cash through the airports

I posted the following post on the Oasis forum and I have been asked to copy it on this forum. I did post a similar article earlier this month on the financial implications of property values in Spain - but I am happy to post this again (so sorry if it duplicates my other post). It is not that I like to see my name in print. I am owed 100k Euros by Huma - so am right in the thick of the battle to get my money back - but new UK people need to be warned of the problems with Huma and ACC peoplemust not feel pressurised to transfer to Oasis - it could be a massive financial mistake - make up your own mind.

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From Oasis Forum posting  ...

Can I state my position clearly - I bought ACC and have decided that I will pursue a full refund via Court Action. I do not trust Huma.I do not personally think this is the right time to invest in any Spanish property for the next 2-3 years at least.

However, I stupidly recommended elderly friends to purchase @ ACC and feel highly responsible for that poor advice in hindsight.

My friends are desperate to go to Spain but are relying on me to further advise them and of course I feel very worried to advise a transfer to OCC, which they have asked my opinion on.

It appears to me first that the Spanish property market is ready to free fall - if not already started with key ready properties been offered wholesale @ 30-40% discount in many locations.

Does this make Oasis a good buy as I understand from talks Huma refuse any discounts or compensation even for ACC transfers?. Does this not make OCC very expensive in this current marketplace and probably way over priced in the short term as the prices will almost certainly continue to fall rapidly all over Spain bringing all prices down - off plan, key ready & resale?  Are Huma depending on ACC transfers to keep prices high! I would be interested to hear comments from purchasers - who must have carefully considered this and justified their decision.  The problem from a financial assessment is that if you purchased @ ACC for say £50k deposit on a property price of £120k - then since Huma are not offering disounts - then if your OCC property sold for £120k is worth only £60k in 2 years - then you would have been better walking away losing your £50k deposit than end up losing £60k on the resale value of the newly occupied OCC property when built.

The problem is no-one can predict the resale value @ OCC or the property market in 2010 - but it does not fill me with great expectations.

The other financial problems are that the pound is falling rapidly against the Euro and will continue to do so in the next 12-24 months. That means that when you pay the £60k above - you will have to pay say 20% more for your Euros than in 2004/5 and so you pay £72k - a further cost/loss of £12k.

I feel there could be a potential capital loss of £72k on a £120k property. Of course if you are buying not as a safe investment but purely as a holiday home for you - you may be happy to wait many,many years to recover parity resale price and feel you have benefited from possession - but make no capital appreciation.

I think to transfer to OCC just to secure any previous payments is a worrying strategy if that is the only reason.

Obviously I am painting a pessismistic picture, but as an Accountant and involved in the Construction industry - I deal in figures and financial forecasting- I am surrounded by looming doom and gloom in the UK property/construction sector. There are to be some sensational news to come soon in the counstruction arena. Some shocks will be released in the next few weeks.

I would welcome replies that question some of these financial assumptions - as even writing this it really scares me. I hope I am wrong but fear I might be proved right.

I am toying with suggesting that my friends walk away from their £50k and buy somwhere else in 1-2 years time and be much better off - as they could get possibly a £60k plus discount off by then. I actually think they could get a £50k discount today on certain areas. That is a hell of a responsibility to shoulder!! I fully accept that getting refunds back from ACC will be difficult and lengthy and may never happen - so I have warned them they could loose their £50k deposit.

The other question I would like someone to answer - which may help me make a decision is that Huma have made no siginficant revenue over the last 2-3 years. So most of the income came from ACC.  ACC is now dead - so all the purchasers will be going to Court - the cost of this will be very high to Huma.

Huma must have used money from ACC to purchase OCC and fund operations (unless someone has other evidence they have not). This means the costs of legal recovery will be high for Huma in 2008/9 there are many Writs in final preparation ready to be placed to the Courts.

Will this mean that Huma will soon run out of money (if they actually have any) fighting court cases and refunds/compensation? - I cannot see anyone settling out of court anymore with Huma bouncing cheques. Does that mean OCC could easily be stopped for financial reasons - not illegallity this time?

Since there is a direct relationship between Huma Indalo and Huma Mediterraneo - and ACC  was illegal I think legally the Huma group of companies/ Directors will be responsible for all ACC refunds/compensation.

Again I may be wrong on this - but has anyone specifically asked this question direct to Huma and your own solicitors, to ensure OCC will be delivered and Huma is financially stable - even after refunding all ACC claims.

I am not scaremongering - these are legitimate questions that need an airing and need to be debated and answered. I would welcome to hear other people's comments. I have been totally ignored when writing to Huma to answer the above questions.

As an Accountant - I deal in facts and the law and in forecasting/budgeting  - looking at present trends and future risks/market conditions and opinion. All the indicators are bad and falling currently. All markets usually eventually rise - the trick is predicting when and not buying at the high point.

I hope OCC happens and investment value is at least acceptable and all ACC clients are refunded in full. I sincerely hope everything works out for everyone! But there are so many fundamental questions left unanswered! It is a pity Huma are not open at all to any talks at a senior level with clients. The girls in customer service/sales are just nothings in the higher structure of the company. I have been told they have no authority on several occasions to answer such questions.

John

I feel your comments have some merit - but I don't personally believe that the Spanish market will drop by much more that 20%.  If you look at resales at the moment there has not been a great drop in the average prices quoted on the internet in the last 6 months - but what you will see is the odd property well below the price of other properties (10% to 20%) these properties sale - the other ones just stick.  This suggests to me that a lot of people have bought properties in Spain and are just prepared to hold them until the market picks up.  If they are desperate to sell then they lower the prices by about 20% and they then sell.  In the UK we are likely to go through a recession in the next 12 months which will reduce property prices in the Uk and have an added knock on in Spain - but a lot of Spaniards are buying second homes in Spain (as are Germans etc) I think this will blunt the level of reduction in prices.  Comparing to ACC - prices which were set back in 2004 - there has been from that date to last year a substantial increase in prices.  If you are saying Spanish prices are decreasing you need to factor in the past 3 years rises first.  If you look at a Tariffa (I paid 116,000 euros for the one I didn't get) then there probably has been a 30% price rise before the latest drop in pricers (hence the reason OCC is been advertised at well above ACC prices).

Taking this all into account if ACC were to go ahead today then I think in 12 months time the value of your property would not be far of what you would have paid for it.   However OCC is further from the sea, further from a proper airport, and on the outskirts of a desert.  Prices here should not be the same as ACC.   The big incentive in transfering to OCC is that you could get a bank guarantee which would protect your money.  If as you say HUMA are short on funds and go bust then by transfering to OCC and obtaining a BG you would be protected and better of.  In fact if you transfer to OCC and get a BG then the best thing would be for HUMA to go bust!

I have no BG - I have consider transfering to OCC but the location is totally wrong for me.  I also do not trust HUMA to give me a bank guarantee and that is why I will not transfer across.  At present I am taking legal action to get my money back.  If I do get it back (along with interest) then I will actually have had quite a good investment due to the euro to sterling exchange differences. 

I would like to offer a little piece of advice for anyone thinking about transferring to OCC with the idea that if you can get a bank guarantee then your money will be safegaurded. Please consider this very carefully because we have had a bank guarantee since 2004 and the bank is refusing to refund our money. They are also refusing to communicate with our solicitor.

So transferring, if you haven't got a bank guarantee will not make your situation any easier. I would not trust Huma to do any  business again at any cost. Look at the way they have treated their ACC clients. We have been promised a result by them time after time but then they do not deliver. Please consider carefully.