Spanish Real Estate forum - Spanish property - Estate agentsSpanish Real Estate forum - Spanish property - Estate agents

kedisg · 11-21-2007, 10:05 PM

Hi . Kedi Star Group Is A Family Run Business Based In The Town Of Alhaurin El Grande. We Offer Both Residential Property Sales And Rentals, Commercial Property, Worldwide Developments And Investment Property.

Our Dedicated Sales Team Is On Hand To Assist You With Your Property Requirements Here In Spain. We Promise You A Fresh Friendly Service At All Times

We Are Always On The Lookout For New Properties To Add To Our Database So If You Have A Property You Are Looking To Sell Then Please Contact Our Sales Team To Book You FREE Home Evaluation Visit

We Also Offer Other Services Separate To The Real Estate Division . Please Visit Our Main Site (www.kedisg.com) For More Details On These Services.

Look Forward To Hearing From You

mikeinspain · 11-22-2007, 10:34 AM

Hi Jim

Welcome to the forum!

I did not see a link to your site so I made the edit in your original post to include it.

You can also add the link to your signature.. :-)

Homefinder · 11-22-2007, 01:40 PM

I don't think that it is so much that Spanish real estate is in such real trouble because the Spanish construction industry will be worse affected.
The fact is that there are 3 - 4 million unnoccupied properties in Spain and perhaps another 1,000,000 under construction or at the planning stage.
The bubble has burst and the boom is well and truly over.
Nevertheless, there seems to be as much interest as there ever was.
You don't even have to qualify that with "in certain areas" because everything has it's price.

The simple fact is that prices now have to adjust.

Most developers cannot afford to reduce prices. This is not so much due to the high cost of construction because that will come down when unemployment starts to bite.
The real problem is that they have paid too much for the building land and they are competing with a huge surplus of resale properties.
Only the most sought-after and unique properties will stand any chance of selling.

The resale market is another matter entirely.

Sellers who bought several years ago can afford to sell at "adjusted" prices. This won't bancrupt them, as it would a developer. They just have to take a smaller profit than they were expecting.
1,000's of borrowers are in default with their mortgages. Banks will have to foreclose on some of them and the properties will enter the market, either at auction or via estate agents.
Of course the banks or defaulters (as the case may be) will want them moved quickly.
This will start the ball rolling in the right direction and is exactly what happened in the 90's crisis - which happened for entirely different reasons.

The long term situation.

Buying is slow right now and this is because the international press is full of news about Spanish real estate "bubbles" and "crisis", so buyers are expecting prices to fall.
When buyers expect prices to fall then that is exactly what happens.
It is not like the UK market which has a shortage and people need a roof over their heads. Most buyers of Spanish property are buying second homes.

To summarise: As prices adjust a healthy resale market will emerge and that will take 2 to 5 years. It will be a lot longer than that before values recover to the point that new construction becomes economically viable.
Obviously the most sought-after areas and those offering something really unique will recover first.

ARTICLE: The Spanish Tourism and Real Estate Crisis.

Richie · 11-23-2007, 06:37 PM

Welcome to the forum Kedi Star Group.

I think it is going through a bad patch at the moment but it will recover and Spain will ALWAYS be the number destination for holiday makers and people looking to move abroad.

I can see a huge rise again in sales within the next year or so, (fingers crossed!!!).

Matthew King · 11-23-2007, 08:13 PM

Welcome to the forum Jim, Interesting poll you've made there..

I voted it will recover in the end, 2 years + a lot of agents are saying there's going to be a big turnaround next year, but I can't see it happening personally.

Four years ago prime time television was full of programmes about moving to spain, living in spain, holidaying in spain, working in spain and the likes. Now not only have all those programmes moved onto sub standard channels (ITV4 etc) but theres a lot of negative ones too.

So I think despite the mess Spain has got itself into, the interest from the UK has dropped off, and now turned bad. That's why I think it's going to take more then two years for it to recover.

During this period, you have a lot of people returning to the UK, and not so many moving out to Spain.

Everyone needs to forget about Spain, then rediscover it again with a fresh view.

Or at least let the market pick up for 5 minutes so I can sell my damn Villa!

Homefinder · 11-24-2007, 10:52 AM

I agree with Richie in that Spain is the No.1 tourist destination and the most popular for those choosing to move abroad, these are both facts.
I would also say that nothing is likely to change, even in the long term.
Nevertheless real estate is going through a bad patch, no doubt about that either.

In my opinion Spanish developers have built too many properties too quickly causing prices to rise at unsustainable rates and this was fuelled by the availablility of cheap money and short-term speculation (off-plan deals).

Buyers in the next few years will be looking for properties to live in or enjoy as holiday homes long-term.
Most sales sales will be second-hand properties because there is an increasing glut of these but buyers will be looking for bargains and sellers have to adjust asking prices accordingly.
How many 1,000's properties do Kyero.com (for example) have listed? What proportion of the whole is this? What sort of figure are we talking about, it obviously runs into millions, but how many millions?

There was a similar crisis in the 90's but caused by different reasons.
The short of it was that the UK pulled out of the EMS and Sterling hit the bottom of the barrel. Spain devalued within the EMS, which eased the situation for them almost immediately but real estate values continued to fall to around 50% of the previous peak.
Within a couple of years tourism started to improve dramatically.
By the late 90's the UK economy had bounced back, the Brits started buying Spanish real estate like never before and the boom continued until now.

It has been suggested that a simple solution for Spain would be to devalue again, if that were possible, but it is not so thay have to do it the hard way.

One has to consider the overall effect on the Spanish economy because construction, tourism and associated industries account for around 30% of the workforce.
There are just too many properties for sale, the construction industry is grinding to a halt, Spanish tourism is suffering from fierce competition from emergent and recovering destinations and unemployment will increase.
Many redundant borrowers will be unable to afford their mortgage repayments and even more properties will enter the resale market.

In the end the real estate market will start to move again but only when values have fallen to realistic levels.
It is up to the real estate agents to get things moving and that means convincing selling clients to reduce prices and the sooner we accept that the quicker things will get going again.

Sorry but that is my opinion!
This is the THIRD major crisis for Spanish real estate. The first one occurred during the oil crisis of the mid-70's.
Both times before it took the same course!

Homefinder

Matthew King · 11-24-2007, 11:58 AM

I too agree that Spain is the number one market for holidays and buying abroad, at least for the British market.

But, its no doubt that the market has dropped out completely for buying abroad, as I mentioned the British media has shifted completely from buying property in Spain, to doing up your property in Britain, moving to the British countryside, and moving up/onto the property ladder. There's no focus on moving abroad anymore.

Those that are interested, or still interested from the past media blitz are then running into the problems that Spain itself is having with pricing etc.