time to buy in Spain??

 Hi Everybody,

My name is John and i would like to buy a property in the Spanish coast but i am afraid of loosing my money. Everybody is talking about the crisis in Spain  and i don´t know what to do. Now i´m living in Valencia where i rented out an apartment but i think that i´m wasting my money. Two weeks ago, a friend told me that he bought an apartment in Alicante at a really low price and financed by a Spanish bank. He put me in contact with his state agency (gpspain.net). They told me that it´s time to buy in Spain, they work only with Spanish banks which are offering housing at a 50% discount and granting a minimum 50% mortgage loans. They offered me a 93 sqm housing completly new for EUR 125.000 in Denia. 

What should i do????

Thank you for your help!

Hi John,

As you are already living in Spain, it would probably be better to buy a property rather than continue renting.  There is no guarantee that you will not lose money - there is a risk in everything.  Even in the UK people are losing money because of recent events.  If you enjoy life in Spain, want to continue living there, I would go ahead and buy.

Hope this helps.

 No reason not to buy if you buy at the right price. There are a lot of properties on the market for €125,000 and don't take for granted that you are getting a bargain with a 50% discount of the original price, as the original prices were way over priced. If you are dealing with a bank they will negociate a price with you to get the property off there books. I've seen properties at 50% off and the discounted price was already too high for the property and the area so make sure you search out the area first and compare prices and test the water. It may be a good deal but be careful. Right now I wouldn't consider buying unless the price was right and that the property had good rental prospects in case of a change of mind further down the road.

 THX Ian!

Ian

No reason not to buy if you buy at the right price.

A lot of people say wait, because prices will keep going down. What? Will they go down until they're zero? No, because sellers will not just continually lower their asking prices and then accept any silly offer made. Decent places will not be found at bargain basement prices and it would be very much the poorer quality property that loses its value. As Tamara and I have said several times, if you continually wait you can also lose out. If you rent for another year or two, for example, then how much will that cost? It's all a gamble - as long as you really feel the place is right for you and you think it's a good price, after comparing it with other places for sale, why not buy?

As I said    I am not saying don’t buy but be aware, those who are selling, or are in the selling business, will always tell you now is the right time. They would be mad not to ! But it does not mean it is sensible advice. 

Eggcup, have you sold the three properties I believe you have been trying to get rid of for ages ?

Maybe you are to be the adjudicator on who has a right to express an opinion or not, because you operate from pure, altruistic motives in everything you do and say? And the rest of us are somehow on the make? How is my expressing my opinion on buying or selling in another part of Spain to where I live have any connection to my personal business? Of course, I have successfully sold during the crisis, not that it's anything to do with you, and I refused silly offers, so I do speak from experience.

So can you kindly refrain from turning this into a personal attack, as I have had to complain about others doing this in the past?  I do not speculate on your personal motives for posting on this forum, although you are obviously motivated to do for one reason or another and I could speculate on the psychological reasons behind this, but that would be irrelevant and none of my business. So can you stick to the question in hand as it affects the poster, rather than try and turn the thread against me or anyone else?

"The lady doth protest too much, methinks."

From Shakespeare's Hamlet, Act III, scene II, where it is spoken by Queen Gertrude, Hamlet's mother. The phrase has come to mean that one can "insist so passionately about something not being true that people suspect the opposite of what one is saying

If you are worried aboutlosing your money then you probably will do.

I have owned & lived here for over 11 years. I wouldn't buy again even if they were offering it for nothing & 10k thrown in.

The paperwork, tax situation, new asset reporting law , difficulty selling even when you have a buyer, Myriad amounts of people all employed by the government , in all departments,whose sole achievment in life was the attainment of a " job-for-life" by virtue of the oposiciones, when the vast majority are in no way qualified & learn on the job.

No I'd stay renting

How do you know if you have the right price? Well that's the eternal question. With the market as it is you won't know if you could have saved a bit more or not. What is clear is that most banks have already got rid of most of their "bad properties" and cleaned up their portfolio so there isn't, from what I understand from a particular bank source close to me, that mad rush to get rid of what they have left. Don't get me wrong they still want to load off the properties so you can still get a knock down price but whether they go much much cheaper or not, I'm not sure. But then that is just one view point from one bank. It depends on how you buy and what sort of a problem the bank has with the property ultimately. For instance the if the property owner or the developer still has a mortgage on what they are selling and is getting into trouble now, it is fairly easy to negociate a "quita" which can be quite considerable. But the bank is not going to give it away nor is the seller, anyone who survived up until now can probably survive even further so the rush factor isn't as great as before. If you want a real deal you need to buy from the SAREB, the bad bank, they are the ones with the real bargains now, but also the less desirable properties. The banks have held onto the good ones.

In  my opinon, the right price is probably around about the prices that were available in 2000/2001 for a similar property, pre-boom time. I wouldn't expect them to go any cheaper. If you do it is because the property is not worth anything fullstop, then no matter what you pay would be too much. For example if the area is not worth it or has no appeal or if the construction is poor and will cost you money in the future. Don't expect people to give away their properties and don't expect them to be cheaper than what they were in 2000 that is a bit much. Selling at that price most are loosing a lot of money as it is. Only if you find someone desperate to sell with serious personal problems would you find something cheaper than what it would have cost in 2000, I think.

But at the end of the day it is worth what you are prepared to pay and what they are are prepared to sell at. Whether the property is expensive or not in Denia I have no idea, it may be incredibly cheap if it happens to be a frontline luxury apartment, which tend to hold their value, but if it is in an urbanistion over a 1 km from the the beach, it might be expensive. 

Why shouldn't you factor in a plan B that contemplates letting? It isn't illegal as far as I am aware, please fill me in if I am missing out on something here, along as you fullfill the LAU or the Civil Code and pay your taxes.... please explain why it is practically impossible to do so? Letting private properties will never become illegal no matter how much the hotel industry pushes, in my opinion, at least.

TIME TO BUY IN SPAIN?

Of course it is, if you want to that is, if it's your dream to buy,  yes prices could drop a bit more, and maybe not, but as it has been said if the house you want is the right house...at the right price....in the right location, then why not.

And if all you house buyers think it's only Spain with a house / buying selling problem, try selling or even buying a house in the UK at the moment...Not like it used to be.

Whats the point of worrying about if you buy today and the price drops tomorrow, you know for sure that's going to happen, ever bought a TV or Laptop on a Saturday, only for it to be so much cheaper on Monday, but if you didn't buy it, it didn't drop in price....different price range and goods...same situation.

Of course you may find the dream home you bought wont sell in a couple of years down the line, but on the whole the one's that wont sell or are hard to sell are the one's these very same people would never buy back in their home towns, but do so without a care abroad, a chap was telling me only last week of two house's he tried to sell, one faced south and sold in a couple of weeks, the other faced north and took nearly two years, same style, same road, same price range.

Ian :   In  my opinion, the right price is probably around about the prices that were available in 2000/2001 for a similar property, pre-boom time.

Just a reminder:  the Euro became the currency in our pockets on 1st Jan 2002.

The rate was 166.38 pesetas to the euro.  And the euro was 1.60 to the pound,  that was  270 ptas to the pound.  

I calculate,  it means that a property the same price today as it was in Euros / ptas in 2002 is almost 40% more expensive in GBP’s

Thus a £100,000 property in 2002 cost £65,000 but would now cost £85,500. 

So following Ian’s  suggestion.    £65,000 would now buy a property costing   76,000 euros.

NB these are ‘almost’ correct figures so please don’t kill me for couple of percent either way

 John maybe I missed your point, but  I'm not sure why you are bringing the Pound into the equation. It really bears no relevance from what I can see on what a house is worth or was worth in Spain nor does the fact that we changed to the Euro. 

Let's take my area as I now the figures . If a house cost  €250,000 in 2009 at it's peak (41,600,000 pts) then in 2000/2001 pre boom it would have cost around 17,000,000pts (€102,000).  That's it.

The fantastic exchange rate with GB pounds unfortunately can't be recovered and won't be considered by any seller and was a passing advantage but it had no affect on the prices it just gave the Brits better purchasing power.

That said that you will not find a property in my area at that price now or even if you wait another 3 years. In my area in Valencia the prices have hit rock bottom and haven't moved for a year. That same propery would be worth around €160,000 now. So it all depends on the area and the property but any cheaper than 2000 prices I think is unrealistic so if you are close to that price and like the property and it ticks all your boxes, why not buy it? Now if you move further out of Valencia you can find properties at 2000 prices or very close to them so it isn't an unrealist goal post to have in mind when determining if a property is at the right price or not.

PS   Your comparision in  2009 using ptas, might be a little confusing to those using the euro since 2002.

More news  (Is it the Right Time to Buy ? )

Well looks like I am not the only one who thinks renting is preferable to buying !!!

Maybe this is down to the many out of work, and increasing, so no bank will lend a mortgage to you if no job, and as you have to live somewhere renting is the only option.

I read in one of the Spanish papers only last week that Spain has had a very good time with house sales, up on the past few years, of course this could well be just like the UK, tell the people that things are getting better enough times and it's gets believed.

It also went on to say the biggest buyers were Norwegians, with the Brits not as far behind as you would have thought.

 I would guess that a lot of the activity from cash buyers.   Prices are so low now that they are very attractive for people with cash to spend.    

No. I have bought my property irrespective of whether it goes up or down, but I am very sure properties have a long way to fall. There is not an estate agent in the world that will say prices will get lower-otherwise there would by no sales except to folk like me-very few and far between. It is still better to buy than rent, for several reasons. If it is for your home, then you should buy, as otherwise ou are at the whim of a landlord who can sell under you every few years you have to move etc.