WHAT IS A SPANISH PROPERTY REALY WORTH

Windtalker you amaze me at times. Other than a couple of blocks now being finished in Madrid, where is any building going on to sell ‘’off plan’’?.

Ellsietanner up until the credit crunch In 2007 all New. properties in Spain where sold off plan with the promise of being worth a fortune when you got yours in three year time the majority that signed up lost all of the money they put down on properties that did not get built the buyers dried up and the pyramid collapsed and the builder run up the road with suitcases full of deposits that they did not pay back. ........I just don't know what you are on about with your statement in you're last post do you.

Brian wrote: "I don't see why it's so difficult to understand!!!!!"

It doesn't surpise me that you don't understand because you've confused what is required for the completion of a transaction (which does indeed require both participants to agree to 'a sale') with who it is that actually determines the price an item is worth (or its 'value'). This applies to every sale - not just property

You wrote: "If a seller doesn't accept an offer the property doesn't sell" - Which is correct and makes my point that the seller is NOT the one who determines value. He can only decide whether an offer is accepted (or not) but he doesn't control the price of those offers (absent things like the use of force that you mentioned). His non-acceptance of an offer is nothing more than an indication of his personal threshhold below which he will not sell.

His 'valuation' is not the same as an indication of its 'worth' or 'value' at that time.

e.g. A seller wants 120K and rejects the first offer he receives for 100K. The next 10, 20, 30 etc. offers he receives are all for less than 100K. He goes back to the first buyer 6 months later, accepts 100K and the sale is completed.

So, the 'value' of that property was NEVER higher than 100K and the seller had nothing to do with that. That maximum 'worth' or 'value' remains true whether the seller had accepted 100K 6 months earlier or any time after.

Therefore, his acceptance or rejection of offers never had anything to do with the property's 'value'. That was only ever determined by the buyers.

Windtalker this thread is about now 2017.

And it has nothing to do with Tupperware parties in the UK.

Can anyone help out here, is it me that has lost my marbles or Windtalker?

No Ellsie this thread is basically about people buying property in Spain in the passed for big sums of money ...and are now being told they are not worth what they paid for them hence the reason property is not seling my last two posts where basically about how they are hood winked in to  buying some thing that is just not worth what it is being sold for   or are we missing something hear.

UK Govt info on buying property in Spain.

https://www.gov.uk/guidance/how-to-buy-property-in-spain

https://www.gov.uk/guidance/how-to-buy-property-in-spain#history

Also be aware that new law relating to offplan property now provides less protection for those purchasing offplan after Jan 2016.

http://www.theolivepress.es/spain-news/2015/11/11/new-law-in-spain-offers-fewer-safeguards-for-off-plan-property-buyers/

You are wrong Windtalker. This thread is all about what is a property worth today and how is that valuation determined.

If you wish to start a new thread on all the ins and outs of the property bubble and the buying and selling practices pre 2007 please go ahead and do so.

Potblack the value of a property is only worth what a buyer at the time of the sale is prepared to pay for it ......unfortunately for the seller that bought a property in a inflated market of let's say Ten years back and is trying at least get his money back this comes as a big sticking point in the sale and is the main reason no one can put a proper value on a property in spain ,on my urbanization some villa's have been up for sale for the passed ten year's at the price they paid ten year's back approximately €250,000 and yet many Villa's of the same design on my site are selling now for €125,000 approximately  so anybody with half a brain would say they will offer around €125,000 but if you are stupid enough to pay €250,000 for it the their is plenty of people in Spain ready to take your money like me if you do your home work you will come up with today's value or am I missing something.

Windtalker. You are so hard work. Whatever someone paid 10 years ago may influence their Alice in wonderland asking price. On this thread we are discussing how a true valuation can be put on a property today.

50 years ago you could have a night out at the pictures, 10 pints in the pub, fish & chip supper, bring home an hovis loaf and have change out of sixpence.

Grow up.

Pot black I don't want to get into a argument but my last post explains in layman's terms how to value a property in today's property market.

I'm really sorry but I don't have anything else to contribute after this.

im a registered valuer in the UK and I have passed on some information about the valuation of properties for any assistance it may give concerning how valuations are made in the UK.   I also pointed the person starting the thread to the RICS organisation to ask about a current day valuation.

Some of the postings seem to have either misunderstood my comments or are having difficulty understanding the basics of what I'm trying to say.

Maybe better to just say a sale generates a worth, a value is made true when a person offers and the owner accepts a price.   It can't be completed without these things both happening.   A valuation is an assessment of what someone will accept when an offer to buy is made.  It doesn't matter how big a property is or what is going on elsewhere, this becomes the value when it's sold.   

I will leave you to discuss the different things that may affect what an offer and acceptance transaction is all about, because it doesn't matter.  

The person asking about the value of a property in Spain on this thread may want to see the many comments here and decide the market valuation is complex and decide to ask professional advice.  

Thats what I recommended to start with, and it's what I recommend now too.

hope this helps. 

Brian I am sure the RICS organisation works well in the UK and any other country where there is an active property market which gives professional valuers the advantage of reliable comparisons and access to the facts on the land registry.

Unfortunately Spain has neither. No access to the land register and so few properties selling that the data if there were any would be useless.

Perhaps the best valuer is Gypsy Rose Lee down Torri beach.

"Some of the postings seem to have either misunderstood my comments or are having difficulty understanding the basics of what I'm trying to say."

Nonsense - I don't think anyone is having difficulty understanding ** EDITED - inciting **

The original poster said that a property is only worth what a buyer is willing to pay (that is simple, easy to understand and correct). Your "two-way transaction" response was to suggest that the buyer and seller impose an equal force in determining its value/worth (that too, is simple, easy to understand but wholly and demonstrably incorrect). Only the decision to complete the transaction itself is equally two-way - but how value is determined is not equal. Not only is it unequal but there are millions of examples (including Real Estate) where the seller has zero impact in determining final value/worth.

e.g. A seller can only enter an item into an acution and (optionally) set a Reserve Price. That Reserve Price is not the item's worth but only reflects the minimum price that the seller is willing accept - and is totally analogous to the minmum price a property seller is willing to accept. The Seller may or may not have obtained a valuation first before establishing the Reserve price. That's irrelevant. Valuers have no idea what someone, somewhere might be willing to pay. At best, a valuation is a best guess - even at Sotherby's.

If the Reserve is not met, then that outcome was entirely the result of action (or lack thereof) taken by buyers who determined that the item was not worth the Reserve Price. The seller was uninvolved in that outcome and had no role in the buyers' decision nor in their determination of the property's lower worth.

Even if the price exceeds the Reserve Price, again the seller has zero impact on determining its worth. The ensuing bidding war (and by extension, its 'worth') was decided entirely by the buyers. The seller has already, explicitly agreed to sell to the final bid once the price reached the Reserve. He never had any idea of what that that final bid would be and even less impact over it while it was being reached by the buyers.  

This happens when properties are sold in auctions too. Outside of an auction, it's called gazumping. It makes no difference, in the final analysis, it's always buyers who decide what something is worth. 

I think it's important to understand the distinction otherwise, as we can see from this thread, that buyers all too easily find other people to blame when it was their decision to pay what they paid. Even the buyers who paid more than their property's worth now had a limit at the time they bought. e.g. no one bought a one bedroom apartment in Torrevieja for say, 1 million Euro - even if they had billions. At some point, you, the buyer made a decsion that the pice you paid at the time - was worth it - at the time. The R.E. shyster would have gladly sold it to you for double what you paid - so obviously you had some limit and concept of what YOU thought it was worth at the time.     

I accept that many were misled but is it really 'news' that people from within the Real Estate Industry lie for personal gain - some habitually - and present themselves as 'experts' in predicting future prices and claim to be knowledgeable about 'worth' when none of their crystal balls are any better than yours?

This message was last edited by MarkMunns on 25/02/2017.

This message was last edited by MarkMunns on 25/02/2017.

Glad you got that out of your system Mark. 

Lets agree your absolutely right in everything you say and think, it's probably much easier that way, I don't mind at all. 

Auctions by the way are not market conditions, they are auctions.   If someone enters a house into an auction they are accepting that will be the price they will get, the seller agrees to sell before it's sold, what's the difference?   Both buyer and seller has to agree to a sale transaction, otherwise it simply doesn't sell.  Would it be right to say the value of a Picasso is the price paid the last time it changed hands.  If someone says it's worth more, that's got to be evidenced in the market, or it's a guess or an opinion  .  When it sells again, (on that day) it has a new value.  Look at the percentage of properties that are auctioned and apply that to the housing market, it doesn't work as a valuation.    

Potblack.  Yep I can only comment on the UK ( I think I said that already).  But it's a worldwide organisation and exists in Spain.  My advice to the original poster (who's probably as fed up as i am now) is to contact them and ask for advice. 

What the heck are we arguing about???

In 2012, I paid 10k over the assessed value (valoracion?) for my place in Spain because I really wanted it and saw it was a 'diamond in the rough.' 

But the price I paid was less than the asking price, 5 times reduced. 

And when looking at the papers, such as nota simple etc, I discovered that the price I paid in 2012 was 36% less than what the seller's recorded mortgage was in 2006.  I'm assuming that when the seller purchsed the place, he made a 'down payment' - maybe 20%, making this a huge loss for the seller. 

Some said I was crazy to pay over the assessed value.  But the seller wouldn't budge and I knew that he turned down other offers to buy that were close to what I was offering.  In the end, it was worth it to me and I have no doubts that if I need to sell, I won't be losing any money. 

So what was and is the value of my place?  Since purchasing the place, I've made substantial improvements and compared to everything I see that is comparable in my area, it would command the highest price in the area.  But the pool of people who have the money or are willing to spend money for a higher-priced place is smaller than the pool of bargin hunters and those who cannot afford a higher priced home. 

There are many factors at work.

Good case of you agreeing a price with the seller where a value was established on the day Gary.  As you say just because you want to pay less, the seller had to agree, bingo. 

Whats valoracion?  Is that the amount a lender places as a value for lending to protect their interests?   If it is I am guessing the surveyors will use a formula there.  That's the area this poster needs to explore to obtain a valuation I reckon.  

** EDITED - Against forum rules **

"Auctions by the way are not market conditions, they are auctions."

** EDITED - Against forum rules **

** EDITED - Against forum rules **

** EDITED - Against forum rules **

You seem to like inventing your own definitions of 'worth' and 'auctions' to support the unsupportable and avoid having to admit being wrong (wouldn't we all like to do that) but unfortunately, that's not how the real world works. 

The Picasso question is a very lame, straw-man argument and also wrong but let's not deviate any further. I get the feeling you introduced it as a distraction to avoid having to explain in what way is the seller determining the value/worth when buyers are engaged in a bidding war that has exceeded the asking price - (which would support your hypothesis that sellers/buyers are equal two-way determinants of 'worth'.

Whether it takes place in an auction - or during gazumping outside of an auction - or when two buyers show up to buy an advertised car and engage in offering more than is being asked, the seller plays no part in determining the final value or worth - only the buyers do that. 

Or will you just keep disputing that any examples given will not conform to your (unilaterally derived) definition of 'market conditions' ? 

This message was last edited by MarkMunns on 25/02/2017.

This message was last edited by MarkMunns on 25/02/2017.

Mark.   Your getting too aggressive here.  

Read Gary's comments and remark on that.  

I don't see anything in your description of markets that says auctions or houses either.  

Ok   Two people turn up and have a bidding war on a car on my drive, one person gets to the highest figure because the other guy hasnt enough money left.  I look at the guy who offers the highest amount and I think, just a minute maybe I can sell for higher.  So I tell the guy, sorry I'm not selling it right now I'm going to wait for a while and see if I can sell it for more.

Hey presto the value has not yet been established because it hasn't sold between two people (offered and accepted the owner said no). 

If the guy on my drive says I must sell it to him, I'm calling the cops haha, no way can anyone force a seller to part with goods they own, unless its fettered (what's the dictionary for that I wonder).

The next market I go to I'm going to pick up an item on sale for 50 quid and tell the owner I'm only going to pay them a tenner, because it's only the buyer who determines what it's worth or value is, it's got nothing to do with you   

Somehow I don't think that will work, I think your playing with me Mark, I get it now.  Doh I fell for it, well done  

This message was last edited by briando55 on 25/02/2017.

"I don't see anything in your description of markets that says auctions or houses either."

** EDITED - Against forum rules **

FWIW, it also doesn't say anything about eBay, Amazon, car boot sales, garage sales, goods being sold at local fetes etc. etc. etc. either.

So are they all disqualified from the definition of 'markets' too? Do you actually consider what you're going to write before touching the keyboard? 

However, the Dictionary's definition does include:

"an open place or a covered building where buyers and sellers convene for the sale of goods"

AND

"a meeting of people for selling and buying".
 
Are those acccurate descriptions of Auctions? If not, why not?
Is there anything in those definitions that disqualifies Auctions?

** EDITED - Against forum rules **

1. The original poster stated that a property's worth is determined by the buyer.
2. You replied that its worth was a "two-way" thing - which implied that both the buyer and seller were of equal force in determining what something is 'worth'.

For that to be true, you would have to be able to show what force a seller is exerting in the final value/worth of an item when two or more buyers are engaged in a bidding war.

If you can show that the seller is exerting equal, two-way' force in determining the final price, you have made your case, If not, then your original assertion that both buyer and seller have an equal impact on 'worth' is incorrect. 

This message was last edited by MarkMunns on 25/02/2017.

This message was last edited by MarkMunns on 25/02/2017.

This message was last edited by MarkMunns on 25/02/2017.

This message was last edited by MarkMunns on 25/02/2017.

Ok mark.  No problem. 

The chap Gary has given an actual non dictionary case of him offering 10k more for a property because the owner held out, he decided it was worth it to him and offered it.   

Thats one.

The example you used as two people barter over a car (I assume you can accept that's not a straw man argument when you use it).  The seller has a market for the vehicle, it's established that one person will pay a higher price than the other (agreed so far).

 The person who gets to the highest figure and then holds out his hand and says deal? 

Then we have the bingo moment, the person who owns the car has to say yes or no (agreed)

So the worth or value is established between the seller and the buyer.   Thats using your own example so I'm assuming that's ok for us both.  

Indont want to discuss what a market is from the dictionary, that's describing the different types of markets and what they may include, it doesn't describe the market values.  I'm doing all this without thinking so I hope it makes sense.