Spanish Property Market Update from Spanish Hot Properties
Spanish Property Market Update from Spanish Hot Properties
Posted by
SpanishHotProperties
340 days ago
(http://www.spanishhotproperties.com)
Category: World & Business |
It’s been a very interesting week to date with surprise surprise all bad news with the current Sterling and Euro exchange rate seeming like the final nail in the coffin for the Spanish property market, well from UK property buyers at least.
With a recent report that recent sales of newly built homes outnumbered resales for the second quarter in a row, which is unusual. The report points out that this is due to long sales cycles in the new build sector, so today’s completions were probably originated in better times. Developers’ new sales have collapsed this year, On a quarterly basis, comparing activity in the 3 quarter to the preceding one, property sales fell by 8.6% overall, breaking down into -3.6% for new build, and -13.13% for resale. In the year period to the end of September there were 610,052 property transactions, down an annualized 26.55%, with resales down 36.31%, and new build down 13.36%. The market shrank in all but 3 of Spain’s 50 provinces, with coastal regions taking the worst beating as the holiday home sector implodes. Tarragona province, in Catalonia, suffered the most ( -47.5%), followed by Girona (-42.8%), Barcelona (-42.5%), The Balearics (- 39.4%), and Alicante (-33.9%). With the Balearic Islands figures coming as the most major surprise.
There was more bad news if not unexpected news that after months of desperate maneuverings to try and avoid bankruptcy, the Spanish developer Habitat has finally thrown in the towel, filing for administration this morning in Barcelona. With debts of 2.3 billion Euros, Habitat is the second largest developer to be forced by financial problems to seek protection from its creditors this year, after Martinsa-Fadesa. Barcelona-based Habitat, run by Bruno Figueras, just managed to avoid bankruptcy proceedings back in February, when local bankers and politicians managed to arm-twist reluctant foreign lenders into agreeing to new repayment terms which Habitat we unable to keep to. Given the state of the market, however, it is hard to see how the company will emerge from administration. Far more likely is that the company’s assets will be sold off to pay back creditors.
On a more positive note The European Parliament (EP) today released the first draft of another damning report on Spanish ‘land grab’ laws and urban planning practices that threaten property rights and the environment. There were also calls from the EP for a moratorium on all unsustainable new developments, and threats to cut off EU structural funds unless Spain puts and end to its abusive property practices. In a further threat to Spain’s access to EU money, the draft also points out that the European Commission can demand the return of funds if they have been used to finance projects that go against EU rules. It calls on Spain’s national and regional governments to “carefully review all the legislation concerning property rights to put an end to the abuse.” The lack of clarity, precision, and legal security in Spain’s existing urban planning legislation is behind most urban planning abuses in Spain, argues the draft report. It also worries that Spain’s judicial system is incapable of dealing with the problem.
So with all the negative news what does 2009 hold in store for the Spanish property market, well according to Nick Stuart, Managing director of Spanish Hot Properties “a very positive one for those buying in Spain or with EU currency Zone especially when buying from British owners who want to return to the UK who now find there Euros are more valuable when converting back to sterling thus allowing them to drop there price even further”
Anyone interested in finding out more about how the latest news and how it can benefit you buying property in Spain in 2009 should contact Spanish Hot Properties either by phone or by email.
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