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"Mind you in five years the average person renting will have wasted about €40,000 on someone elses mortgage payments(food for thought""
No!
I will have spent in 4 years half what I would have spent on a mortgage, and avoided a possible mind numbing loss.
Georgia
It might be 5, it might be 1. It might be tomorrow if you have good negotiating skills and can find a willing seller.
As an agent all you need to do is to convince sellers to be relaistic with priceing - given not an easy task.
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Yes I can understand people renting in Spain especially if you are looking around the different area's, with a view to buy eventually which we have met a few couples that have done this.  Renting is a lot cheaper in Spain than UK. For us to rent the house we have now would be over a thousand a month so over 5 years your looking at least 60 thousand pounds to me that is dead money just my opinion. We have a grandaughter who has just bought a two bedroomed flat and doing the rent and buy scheme with the Housing Assoc, she is paying nearly £900. a month which I think is a lot. But her flat has gone up in value, so hopefully one day they will make money on it. Spain is a different kettle of fish as they say you cannot compare with the UK. I am sure we would not have got our apartment any cheaper than what we paid for it.  I would still recommend buying in Spain and as everyone say's do your research. I am happy with what we paid and we do not intend selling not yet anyway, just as well the way the climate is but hopefully that will change. Rixxy only A CUP OF TEA.  Pat
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Yes it is very much each to his own and there are 2 schools of thought, the investor who will buy at the right price, sit on it for a few years and then ralise the capital as long s it rents to wash its face ie rent equal to mortgage.
And the people buying to live here who are not daft anymore and will rent before they decide where to buy
Very few second home buyers at the moment but it is early in the season for them so I cant give any stats on that one, they will be worried about overstretching and frightened by all the bad press as of late as well.
It is a fact buying the right property at the right price will earn you in the future and many people built up multi million pound portfolios during the last slump in the UK. Doin it here on the Costas where it is more lifestyle is another thought BUT today I was speaking with owners of a huge plot in Istan who have permission to build a 6 star hotel resort. Their plan is to sell it and bank the money buying smaller units for cash at discount. Place tenants in them and THEN remortgage to fit the income. Take a 5 - 7 year view and then sell at around 100% profit. Sounds like a plan to me and all I have to do is sell the plot for them to start the ball rolling!
TJ - the guy in the programme still owns the property, it still hasnt sold although he did manage to rent it for a while. It wont sell at that price and he will have to wait to realize his money back, but then if he can afford to do so then thats all good for him.
Pat - yes a cup of tea. I darent have anything stronger in the office as I would be too tempted! With the above clients this afternoon I was sitting next to the lake in Istan at a fishing lodge and the seller had a bottle of red wine. I was soooooooooooooooooooo tempted, but opted for coca cola - otherwise the dog would have had to drive me back!!
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Quite frankly m'dear, I don't give a damn!
www.herbalmarbella.com
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TJ, You said...............
"As an agent all you need to do is to convince sellers to be relaistic with priceing - given not an easy task."
I do agree with that. Vendors please do not be swayed by other agents over valuing just to get them on the books. It only makes things worse and eventually 3 months down the line you have to reduce. If it's pitched right in the first place then it will sell!!!! Makes me so cross, and no mistake, by jingo pip.  . Anyway let's see what happens in 6 months I might be eating my sombrero!
I must be living in a parallel universe in Wales, been really busy and our realistically priced houses  are selling really well. Must be after the rugby on Saturday, this is the place to live muhaha!!! 
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Only last September, José Luis Rodríguez Zapatero, the Spanish prime minister, announced that Spain had joined the "Champions' League" of world economies. Europe's fifth largest economy was growing so robustly, and creating so many jobs, it would soon be richer than Germany in per capita terms, Mr Zapatero predicted.
That euphoria was short-lived. December saw a spike in inflation, a rise in unemployment and a slowdown in the economy, as the international credit squeeze gripped Spain. The government recently lowered its estimate for economic growth in 2008 from 3.3 per cent to 3.1 per cent, a figure many economists consider is still too optimistic. Inflation last month of 4.3 per cent was at the highest level in more than a decade.
Worse, house prices in many parts of the country have started falling, further undermining confidence in the economy. Some overindebted families now owe more to their banks than their houses are worth.
International financial gridlock has brought Spain's credit-fuelled surge to a rude halt. Families and businesses are feeling the pain. Suddenly, Mr Zapatero's Socialist party is less confident about winning a general election called for March 9.
The mood is especially sombre in provincial towns such as Igualada, a prosperous textile and leather manufacturing centre near Barcelona in the north-east.
"I've been a bank manager for 28 years and I have never lived through a situation as dramatic as this," says the branch manager of a regional savings bank, who asked not to be named. "House prices in this town have fallen by 20 per cent, there is no demand, and no mortgage finance. Savings banks have cut off funding. Before the credit crunch, I used to do 12 mortgages a month. Since August, my branch has approved only one new loan."
He says that for the first time, clients are handing in the keys of their homes and walking away from their debt problems. "With the fall in house prices, families are giving up. They don't see the point of struggling on with their mortgage payments." Repossessions, he says, are on the rise.
Some property developments have been stopped, and Igualada, a busy town of 38,000 people, is dotted with idle construction sites and foundation holes.
Developers with recently completed projects were in an even worse bind, the bank manager said. "Because property prices are falling, buyers who put a downpayment on a flat are going back on their agreements. They prefer to lose their deposits than to be trapped in a negative equity situation."
This message was last edited by TJ222 on 2/6/2008.
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Finally, someone who will admit to sense. And it is the same all over Spain
Tomorrow I am having a meeting with a company based in Germany who have been asked to set up in Marbella by a bank down here, to intermediate between bank and mortgage debtors in trouble.
Ultimately they may have to auction the properties off.
Banks are seeing what happened in the UK 90s, and they also dont know how to react. They have a duty of casre to esure they get the best price for the property and we will see banks chasing people for outstanding debt after mortgages are partly redeemed. Some parts of the law have to change and Im hoping this will happen soon.
Interesting times ahead.
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Quite frankly m'dear, I don't give a damn!
www.herbalmarbella.com
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Interesting Rixxy
Keep us posted on here - sounds like the thin end of the wedge to me.
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Very thin end, extremely fat wedge! Im getting around 5 people a day wanting to sell at auction, maens I cant get out of here onto the beach and into the wine before lunch as im used to............................
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Quite frankly m'dear, I don't give a damn!
www.herbalmarbella.com
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Don't you just LOVE TJ's signature ?
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Hold on I just twigged, was that you Rixxy on the Mc Donald tv programme?
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Yep, TJ, it was. I cannot tell fibs.
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Wow I didn't realise I was talking to a celebrity, would have been a bit more respectfull.
Embarrased about my joke now
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Take a 10pound note and look at it, it says "Ipromise to pay the bearer 10pounds"
But what exactly is this 10pounds the issuer is promising to pay?
Is it ten pounds of sugar, or wheat, or rice or pork bellies or Nesquick majic straws?
The original answer is that it was ten pounds of sterling silver, which is obviously where the term pound sterling came from.
So the currency used to be backed by Silver or gold, which is where the term Gold standard comes from.
In those days you could take a banknote and if you wished redeem it at a local bank for a defined weight in gold or silver.
Therefore your banknote was a receipt for real wealth held in a bank. Under this system it was impossible for banks or politicians to meddle with the money supply, if they wanted to print more money they had to get more gold or silver to back it.
This was done by trading with other countries, goods and services flowed back and forwards in exchange for gold. If a country consumed more than it earned, it would rapidly lose its gold, and be less able to trade. This would force the country to get productive again, lest its population starved.
This great for the people because it provided long periods of economic stability and prosperity, and you knew if you worked for money it had real value which could not be eroded with time.
It was however no good for Central bankers or politicians, because they were unable to run up debts without incresing taxes, something that was not popular and difficult to do if they wanted to get re -elected.
So they dropped the gold standard and then were free to print as much money as they wanted. Now a Ten pound note promises to pay the bearer exactly ten pounds of nothing. There is nothing that you can say ten pounds will buy you, because next year it won't buy you the same.
The intrinsic value of a ten pound note is the paper value, which is so close to zero as makes no odds. If everyone today went to the bank and demanded their money back, the world banking system would collapse, and they would be forced to close their doors. This is what happened at Northern Rock and explains why a previously multi billion pound organisation went bust literally overnight.
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Scary stuff really! Glad I havent got and pound notes and only euros now!!!!
And yes that was me with my bit of brass on the T mcD show for my sins!!
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Quite frankly m'dear, I don't give a damn!
www.herbalmarbella.com
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Rixxy
And what exactly is backing the euro. What does 10 euros promise you? And where did the ECB get the 50Billion they pumped into the banking system a few months ago to stop it crashing?
Enjoyed the show Rixxy, thought you were very professional
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Spanish Property Prices 2007/2008
According to official figures from Spain’s housing ministry, Spanish property prices rose by 4.8% on average in 2007, down from 9.1% in 2006, and way off the high of 18.5% in 2003. If you adjust for inflation, however, Spanish property prices only increased in real terms by 0.6% in 2007.
As you might expect from a country as large and diverse as Spain, there were considerable difference across regions. Nominal real estate prices rose the most in the province of Granada (8.5%) and the region of Murcia (8.1%), and the least in the region of Madrid (1.8%), and Alicante (3.3%).
On a quarterly basis prices fell in nominal terms in Extremadura (-0.3%), Castellón (-0.9%), Cantabria (-1.9%), and Cordoba (-1.9%) during the last quarter of 2007.
If the government’s figures are to be believed, then the Spanish property market is gliding towards a soft landing in which prices converge on the general inflation rate, allowing housing affordability to return to normal levels over a period of years. This is the scenario forecast by many ‘experts’, and the government.
Talking of ‘expert’ forecasts, here are a selection for 2008/2009:
- BBVA (major Spanish bank): prices +1.4% in 2008, -1.9% in 2009, housing investment down 3.5% in 2008, planning approvals down 175,000 to 500,000, and 250,000 jobs lost
- Morgan Stanley: prices -5% in 2008
- Deutsche Bank: prices -2% to -8% in 2008
- Natixis (French bank): prices +2% to +3% in 2008
- Crédit Agricole (French bank): prices -10% over period 2008-2009
- Aguirre y Newman (Spanish real estate consultancy): prices - 10% on average, but down 15% on the Costa del Sol, sales down 50%
Returning to the government’s figures, as I have already said, they are widely suspected of being unreliable. Based on mortgage valuations, they have tended to overstate prices so that banks can lend more. A lack of reliable data is a big problem for Spain, as it makes it difficult to know what is really going on in one of the economy’s most important sectors.
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www.taylorlandandpropertygroup.co.uk
still here after all these years!
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Yes am about to reply to your email Georgia - dont worry!!!!
I totally agree as all their figures are based on thin air and I would love to know how they can use valuations when they are reducing their valuarions by an average of 15% so far based on the actual ones I have, I had a case 2 weeks ago, valuation of the property was 238,000 18 months ago on purchase. We had buyer, val came in at 203,000!!! When challened and shown the bank val of 238k which was stated on the nota simple, the new bank said they rang up a nearby developer near the complex and asked them what their cheapest property was. Then using their price per square metre, valued out property! And this is happening constanlty, down valuing from a year ago.
Hence negative equity is rife. Totally ridiculous! Either use one method or the other. Banks used to routinely increase their valuations by 10% at the beginning of every year. Now they are using comparables, but not of actual prices as they cant until new purchases become registered as in the past black money masked the true purchase price.
Prices are coming down, and judging by the amount of people I have already spoken to this week, there are going to be some huge losses around.
By the end of this year, banks will have to divulge the arrears they are carrying and there will be too many propertied repossessed and up for sale that wont go and clear the debts attached.
Big mess - but great news for buyers if you know what you are doing.
Thanks TJ, most people know of me as a pro!!! Youde be suprised what you can get for 10 euros if you know where to go........!
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Quite frankly m'dear, I don't give a damn!
www.herbalmarbella.com
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we are seeing the affects here but the percentage drops are not as high.
What we are seeing here is that some "walk to the beach apartments" are coming back to within the 100k mark which i think is about right.
Brings it into perspective again with UK property prices,after all thats what fuelled the market in the first place......
In this area i honestly do not think prices will fall dramatically on the "comfortable owners" property.
What i will agree with is that as the banks claw back more and more due to personal financial problems due to the credit crunchie there will be more and more bargains avaliable,again good news for buyers..........
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www.taylorlandandpropertygroup.co.uk
still here after all these years!
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Mmmmm credit crunchie........yum yum, just what I fancy!
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Quite frankly m'dear, I don't give a damn!
www.herbalmarbella.com
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