Economic situation in Spain

Come on, not even the Spaniards are burying their heads in the sand anymore.  They all know how screwed things are and how things are going to get worse.  The smart ones will leave Spain to get proper jobs in a proper economy.

Even in the good times in Spain, unemployment was 10%. 

As for Spain's debt problems, the Spanish banking system is the problem.  It would be insolvent if the banks correctly wrote down their real estate loans and repossessions.  I never believed all that nonsense about the Spanish banking system and its regulation being a model of best practice.  Just how many cajas have failed or been forced to merge?  I've lost count.

Here we go again!!!

 "If I were a moderator on this forum, then just for the comments you have made on this thread, I would ban you from the site!"

Well you're not . So please stop your crusade of abuse against Norman.

He is a gentleman from the old school of thinking and has been rudely awakened by the dealings of those professionals  his upbringing   taught him to trust , I.e., his Spanish lawyers. I know from personal experience, the whole business can  knock one's confidence and   question your judgement and ability to make decisions.  

 Norman admits that, until he came across EOS, he was not aware Spain was akin to the Wild West when it came to their property industry of the past ten years. He was not gullible, greedy or even unlucky otherwise he would have been the only person caught up in the whole dirty business. There are thousands who were scammed and mis-led.

Why are you so easily upset by anything he has to say? You are ruining every thread he posts on with your nitpicking and high handed comments on his replies. People do not want him banned, just look at the thread that started up when his broken computer silenced him.

My sincere apologies to the instigator of this thread for going off-topic.

Hi Sandra

thanks for posting a picture of your boyfriend Norman

Nice A...se

Sanchez

I think you have pointed out one of the problems?. Until people from all walks accept how bad things are in Spain and try to do something about it instead of  mainly trying to defend it, and attacking those pointing out ugly truths, then those responsible for the mess will sit pretty and not feel the urgent need for change, nor take much notice of those who are calling for change?

You see by the pic how low Sandra can go. Some friends Norman has.

Wouldn't a picture of a horse's A**e be more appropriate?

the way i see it is the spanish banks have to off load all those repossessions or they have no cash.If they have no cash they can't lend it to those who wish to borrow for their business, so businesses will not grow.The building industry is all but dead so a large part of the countries money has dissapeared with over 20% unemployment and a bad reputation how ever earned the amount of tourists has taken a dive and not just because of the economic situation in the tourists home countries.

so spain has taken a pounding on its 2 main incomes the banks are all but skint the govenment owes a fortune and has a lower income than what it based it borrowings on .If spain was a person it would be looking at getting its house repossessed or borrowing from a different lender at a better rate so to afford its repayments unfortunatley no one wants to risk lending them any money let alone at a lower rate this is why speculators are looking at spain and not the uk who still seem to have a building industry and having the power to lower our £ have attracted more tourists as it is more affordable to come here now.

 Anyone know just how many repossessions there were in Spain last year?  In UK, it was 40,000.  This year, the Times is forecasting some 200 per day, or over 75,000.  From 2008 to the middle of last year, the building trade in UK was also at a standstill.  It picked up again, hence the higher than expected growth rate in UK in the middle quarter, but has tailed off a bit.  If the UK weather continues as it is, it will probably come to a standstill again until the Spring.

I agree, Spain is in the doldrums.  The extremely high unemployment rate is a cause for concern.  The building boom will never happen again, or not to the extent that it did 7 or 8 years ago.  However, Spain still has a good manufacturing base with the automotive and aeronautic industries doing particularly well.  Perhaps diversification into small white goods would be the way to go if they could undercut the Eastern European and Far Eastern countries, but I doubt that will happen.

On the other hand, the UK pays more in social security benefits than it raises in taxes.  The amount the government proposes in saving (which has rather annoyed the left and the students) won't even pay the interest due on the national debt.

Yep, all gloom and doom everywhere except, perhaps, China and India.  

 All the richness is in real estate owned by Banks

This is a product which was planned to be sold to foreigns..

Why do not exchange Banks real estate for debt or deficit?

Given the economic scenario it is hardly likely that many will want to or would be advised to do deals, so long as the situation relating to oversupply continues, as those owed monies by the Banks would then be burdened with a depreciating property, depreciating rental income, increased outgoings associated with their property as local governments desperate for income, look to this sector via increased taxes etc, with little chance of employment for those who wish to live in Spain. Also are Banks honouring their quota of maintenance charges on developments where they hold real estate? We hear frequently of problems relating to those individuals who refuse to pay their maintenance charges. And where are speedy consumer rights to protect them against such abuse without having to incur yet more expense to fight for their rights? So it is imperative that all "innocents" recognise the true situation and come together to ensure that those responsible are made accountable and that the requirement for legal reform is addressed, rather than skirt around the problems we are bearing witness to.

Banks should auction their real estate (at realistic values instead of over-inflating values) to pay back monies owed as per successful judgements, rather than burden purchasers with this costly process. In most cases their offloads will only be perceived as yet another ploy to absolve themselves of their accountability. Also, as has been identified to date, where are the controls to ensure that building standards are adhered to? How many of these properties are substandard builds? How many do not have the promised facilities (gated communities, landscaping as per the original marketing literature, etc). How many who have completed on developers' broken promises have had to fund these facilities themselves? How many have had to subsidise the non payments of maintenance charges? How many of these communities are in debt?

All of these factors have to be taken into account before making any decisions on “deals”. Why should those who have abused their responsibilities over these years not be made truly accountable? Now is the time to pressure for the change we have been fighting for all these years, and “deals” will not address the underlying problems but merely delay the acknowledgement that reform of consumer rights and provision of a decent justice administration system has to be at the forefront of any agenda before many will feel comfortable reinvesting in Spain.

I can't see a deal like that working either?.  I think most people cheated just want their money back and for the time being, want nothing to do with owning property in Spain. Due to depreciation, quality problems, community problems, and the  lack of regulation, legal/justice and common sense planning issues etc, let alone a failing economy,  the banks would probably have to virtually give the properties away before many from other countries would be interested?. If they do that they will then flood the market and bring down property prices even further!

I think before the property industry in Spain has a hope, they must  somehow pay back all those wronged, and change the habits that have caused the current mess. Only then will people feel they can trust investing in property like they can in the UK and other countries not saddled with a well deserved reputation of corruption and lack of regulation throughout the whole property industry.

I know this is somewhat off track but felt obliged to post it anyway. Georgia has just identified the following (from the thread titled Habitation licence required for re-sale property) with regard to  Banks doing deals

"The banks are the biggest criminals in Spain and have their own rules.

At one point over the last 3-4 years they have all asked me to work with them and i must say they are the most unrealistic,disorganised and unprofesional outfits i have ever seen.

I suppose if they wanted to sell you a property and you agreed to finance it through them(as they want you to) and use their legal team they could hide the issues quite simply from an unsuspecting buyer.

I don't think,(well i know) that the banks have any scruples when trying to liquidise their assets.

We have to have 8 different certificates or bills from Vendors or we simply refuse to list them as we know that everybody will be wasting their time and it will not even get to notary, even if any of the parties do not care too much, the lawyers won't do it!!

I also know several banks selling (or trying to) property that is illegal in some way........"

So If ever there is a case to make Banks accountable for their malpractices, and demand some form of controls on their actions, then we should do so. And quickly. Keith is so right to suggest this within his petition relating to Bank Guarantees. (Pleeeeease everyone, support him). www.bankguaranteesinspain.com

ads

well that certainly confirms our fears of 'deals' with the banks!. 

With regards to habitation license and the like, when we were nearing our completion date, I said I wouldn't complete without the LFO, as it's a legal requirement, but my lawyer said that in court, not having an LFO would not be a good enough reason to cancel the contract??.........so once again, what's  the bloody point of trying to do it right?  As it happens, that was the smallest of breaches that we sued for.

Dear All,

we have the old saying that "you cannot get blood out of a stone".

CURRENT reports from SPAIN are that you can drive around whole estates of "superb" finished properties including villas with pools and all services except street names, until you are lost and have difficulty finding your way out.

All totally deserted with no one wishing to buy into a "ghost town".

Yet the "sillies" who have now become the "crazies" tell you that their particular  properties have held value and can be sold tomorrow.

In the UK we are daily pestered by "hungry traders" wishing to show us how to diminish debts.

I suspect Ads' cry to hold banks accountable is a cry in the wilderness.

I suspect they don't have the means and to survive they need to off-load debts or to be bailed out in some way.

What with the demolitions, repossessions and negative equity my lost life savings are becoming insignificant.

There is no hope.

Join the boycott and at least stop the demolitions

Regards

Norman

Where are these ghost estates then Norman?  I know of one only in Murcia region and that is only empty due to builder cash flow problems not lack of buyers........

Well done guys, another thread taken over and the original point completely lost.   Do us a favour and change the record.......it might be a good song but you have overplayed it  (see what I did there)

Here's thought, why not start your own thread where you can moan about the your injustices ad nausium?...then the rest of us can have a conversation or two about other topics..yes they do exist

Sadly the debate about Bank deals and investment do unfortunately relate to the economic situation in Spain.

Regarding the banks malpractices and lack of controls within the banking and building sectors I would like to say to Maria and all the good lawyers out there to gather and present your own evidence which will be crucial to any campaign to effect reform from within. It is no longer credible to continue regardless in the hope that investors will return to the market place, whether through deals or not,  given the fact that most people are now sadly aware and extremely cautious of the corruption, malpractice and lack of controls and consumer protection within all sectors in Spain, whether they be banking, building,or  legal (administration). You have to face up to the fact that Spain has in the main lost the trust from investors, and your government and powers that be will need to correct the underlying problems and call a halt to the ongoing abuses before many will return to  the market place.

This message was last edited by ads on 09/12/2010.

This message was last edited by ads on 10/12/2010.

banks and investment certainly are linked to the Spanish economy. Can there really be anyone out there not making that connection?. 

Just how hard is it for those in the positions to make changes to come clean, pay their debts to those cheated through the failures in the system, then put their own house in order, and then makes moves to encourage investment once again?.

......I fear the answer could be 'very hard indeed?', because of the 'old ways' I wonder if we have anything like a true picture of the banks debt problem, while imagined money is held in thousands of properties of very little value? Those in the positions to make the changes must know full well the real situation, so I see this as just a huge denial scenario, due to the truth being seen as making matters even worse, and possibly cause a rush to withdraw any investments/savings etc.

I'm no finance expert and I would truly like to think I've got it wrong and being over gloomy, and things are not that bad?, because if they are then those cheated have an even harder task to get 'real justice' in the form of monies returned, and the whole economy could be in a far worse state than we are told? What ever the case, I feel the only way forward is to come clean?, (however alian the idea!!) only then can moves be made to get back on the right track, however long that might take?

 You can look at everything two ways here and read as much positive information about any spanish recovery as you can it's demise.

For Example, there are two lines of thinking on the Euro crash.

Some people think the demise of the currency will sink Spain or in essence the demise of Spain will sink the currency.

The other opinion is that if the euro falls against the pound and you can suddenly by 2 euros with 1 pound then property,holidays etc will become much more affordable to the masses and start another gold rush.

Spain has massive unemployment and very little industry on the costas and seems doomed.

On the other hand Spanish banks (Santander) seem to own half of the UK high street and Iberia have a 55% share in British airways to name but a few.

The Spanish debt to GDP seems a monstrosity but is less than the UK.

Banks would lend to anyone including builders with no licences in place, they didn't seem to have any problem with this 5 years ago but now have seen all this property land at their feet and now they are selling these for themselves.

They will lend you 100% LTV on an illegal property that they own but will not lend more than 60% to anyone on something with perfect paperwork.

Some lawyers in the past would let anything go but now want every single piece of documentation ever received from the life of the property.

I have asked banks if they will lend on property that they already have issued a mortgage on in the past, they have declined because the property is illegal, when you point out the fact that it has always been illegal and they lent on the property originally, they look at their shoes and say times have changed!!

I have had an example recently when we had an issue with documentation with a property, the buyers lawyer kicked up because we were missing something down to the builder not completing paperwork 7 years ago and wouldn't allow the sale to go through, it was quite easily resolved and was later found out that her office had done the original conveyancing for the original purchase!!

So, What bothered her now,didn't when she was acting for the original buyer, the answer i got from that was "new tighter legislation has created the need for stricter checks".

It was ok then but not now,times have changed!

Spanish property has crashed !!, people have lost a lot of money (if they are selling)

You can now buy something cheaper than you could in the boom and probably the same price as it was in 2003.

Spain has serious issues with its legal system.

It's a fantastic place to live if you are retired or you are bringing small children up and have reasonable finacial security.

Spain has been fraught with property scandal.

The legal sysytem now is so over cautious you should be confident of a trouble free purchase.

It's not the UK!

It's not the UK!!

and the argument could go on and on both for and against................

I personally feel for anyone cheated in the past in any country but Specualtion is fraught with danger, many people who got caught up in the boom purchasing  property to flip with no real chance of gaining the finance to complete and not considering a crash were a little silly and are understandably bitter through dented pride.

Will Spain crash??? probably......will it affect people in a good way or not?? probably 50/50!

goergia

as much positive info' as negative?. I think that's quite a leap of faith?, but I agree it's a confusing picture when you look at the Santander bank and British airways etc.  I hope you are right, and Spain's not in as bad a state as it's starting to look?

Yes, there were some daft speculators from all over, we all know about them, but they have very little to do with the majority cheated, and the issues within the petitions that have hurt so many and are now helping to bring the economy down.