Thursday, 26 April 2007
Investment Concerns over Spanish Property
'Spanish property is a mid to long term investment' that is the clear message surfacing amid the panic and doom stories generated by this week's British press. It’s been obvious for the last few years that the days of a quick killing in Spanish property have come and gone, but wise property purchases still reap rewards for their owners. The property lifecycle & selling price, location, and legality are the key foundations to buying in Spain.
When buying off-plan look for developments with low introductory rates or those where prices have been held at their original price. Avoid agencies that advertise properties that seem over priced. If buying resale think about the age of the property carefully. Is it too old to be covered by the builder's guarantee? Will old concrete, electricity and water turn your wallet into a black hole?
Research your location in terms of both its current and future potential. Your agent must be knowledgeable about the area. Look for a recommended reliable agency based in Spain and be careful when talking to UK based agents who may not know the area quite as well as they should.
Employ an independent solicitor - and use them! Is the builder providing you with a bank guarantee? By law you should receive a bank guarantee from the builder - but as it costs money to produce it may not automatically appear. Make sure your contract is checked and understand your rights in terms of contract cancellation by either party.
Costa Calida and Murcia
The property market across Spain is not equal and any short term reduction in house prices is unlikely to impact Murcia and Costa Calida in the same way over inflated areas such as Malaga, Madrid and Barcelona. Latest figures show property in Murcia is still 15%* below the national house price average* while Malaga, Madrid and Barcelona are 25%, 70% and 141%* above that figure.
The press have sullied the waters by bringing issues of land grab into the mix, but buyers in the Costa Calida and Murcia are already aware that the 'Land Grab' situation is the abuse by some developers of a Valencian by-law. It is not a national law. However if you buy outside Valencia it does not negate the need for legal representation - we recommend to all our clients that they use the services of an independent solicitor who checks their contract, their property and ensures bank guarantees are obtained for all monies paid.
Pierre Williams of Inside Track, the overseas property investment consultancy, sums up the current situation in the Spanish Property market when he says that those who have invested wisely are not likely to suffer. ""Just as in the UK the era of automatically making vast sums of money on the back of rampant house price rises is over in Spain.....That does not mean that those quality properties in quality locations can not deliver excellent returns as a mid to long term investment,"
Choose your agent, area and property carefully and enjoy the rewards of owning in Spain.
When buying off-plan look for developments with low introductory rates or those where prices have been held at their original price. Avoid agencies that advertise properties that seem over priced. If buying resale think about the age of the property carefully. Is it too old to be covered by the builder's guarantee? Will old concrete, electricity and water turn your wallet into a black hole?
Research your location in terms of both its current and future potential. Your agent must be knowledgeable about the area. Look for a recommended reliable agency based in Spain and be careful when talking to UK based agents who may not know the area quite as well as they should.
Employ an independent solicitor - and use them! Is the builder providing you with a bank guarantee? By law you should receive a bank guarantee from the builder - but as it costs money to produce it may not automatically appear. Make sure your contract is checked and understand your rights in terms of contract cancellation by either party.
Costa Calida and Murcia
The property market across Spain is not equal and any short term reduction in house prices is unlikely to impact Murcia and Costa Calida in the same way over inflated areas such as Malaga, Madrid and Barcelona. Latest figures show property in Murcia is still 15%* below the national house price average* while Malaga, Madrid and Barcelona are 25%, 70% and 141%* above that figure.
The press have sullied the waters by bringing issues of land grab into the mix, but buyers in the Costa Calida and Murcia are already aware that the 'Land Grab' situation is the abuse by some developers of a Valencian by-law. It is not a national law. However if you buy outside Valencia it does not negate the need for legal representation - we recommend to all our clients that they use the services of an independent solicitor who checks their contract, their property and ensures bank guarantees are obtained for all monies paid.
Pierre Williams of Inside Track, the overseas property investment consultancy, sums up the current situation in the Spanish Property market when he says that those who have invested wisely are not likely to suffer. ""Just as in the UK the era of automatically making vast sums of money on the back of rampant house price rises is over in Spain.....That does not mean that those quality properties in quality locations can not deliver excellent returns as a mid to long term investment,"
Choose your agent, area and property carefully and enjoy the rewards of owning in Spain.
Labels: Property Investors
