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Spanish Property Market: House Prices Rise on Quarterly Basis

SpainHouses.netDecember 23, 2013December 20, 2013Leave a comment

House prices in Spain rose on a quarterly basis for the first time since the middle of 2010 in the third quarter of this year, but experts were quick to point out that this does not mean that the housing market has started to emerge from trough it plunged into around the start of 2008.

According to figures released by the National Statistics Institute (INE), house prices climbed 0.7 percent in the period July-September from the previous three months.

Prices on average have fallen over 40 percent from their highs around the end of 2007 after more than doubling over the course of a decade-long boom that turned to bust.

The INE said that home sales in October declined 10 percent from the same month a year earlier to 22,770, the lowest figure since March and one of the lowest since the real estate bubble burst.

Although the economy emerged from an extended recession in the third quarter of this year, a jobless rate of 26 percent remains a major impediment to a recovery in the housing market, which still has an estimated glut of some 600,000 housing units. Banks have also tightened up on lending, citing a lack of “solvent demand.”

Would-be home buyers are finding it hard to secure the necessary funding at current prices and seven out of 10 transactions taking place are in cash.
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Property Market: The Challenges Facing Spain’s Toxic Bank 1

SpainHouses.netNovember 11, 20131 Comment

Five years after Spain's property bubble burst, hundreds of thousands of new and unfinished properties remain unsold throughout the country. Meanwhile, some of the biggest companies in the world have had to eat humble pie, reduce their size, and in some cases have simply been swept away.

Slowly, and reluctantly, the property sector is facing up to one of the major reasons nobody is buying property: the huge numbers of homes that remain unsold, some of them unfinished. This is the case for the major financial institutions, as well as Sareb - the so-called "bad bank" set up to sell the vast portfolio of real estate accumulated by failed, and subsequently nationalized, banks after the property companies they had financed went belly up.

Estimates of the number of unsold houses range between the government's figure of 675,000 and the 815,000 calculated by savings bank CatalunyaCaixa. To this figure also needs to be added the close to half-a-million homes that are still under construction, according to both the government and the real estate sector. The areas with the largest number of unsold properties are, in order: Castellón, where one in four homes is empty according to CatalunyaCaixa; Toledo; Murcia; Almería; Tarragona; La Rioja; Alicante and Malaga.
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Number of Foreign Buyers Surge in Spain, Government Data Shows

SpainHouses.netOctober 8, 2013April 2, 2020Leave a comment

Foreign buyers are more important than ever for the Spanish property market as it continued to shrink in the second quarter of 2013.

Data from the Spanish department of housing shows that home sales fell by 4.2% compared with the second quarter of 2012, but they were up on the previous quarter.

The data shows that it is foreign buyers who are keeping the property market propped up, especially in popular coastal areas where foreigners tend to buy second homes. Overall purchases by foreign buyers increased by 29% over 12 months and 49% quarter on quarter.

In popular areas like Malaga on the Costa del Sol the number of foreign buyers increased by 61% year on year and foreign buyers were up 52% in the Costa Brava, up 50% in Murcia, up 45% in Valencia, up 35% in Alicante on the Costa Blanca and up 25% in the Canaries.

Alicante leads the way in terms of number of sales to foreign buyers, with 4,001 recorded in the 12 month period, followed by Malaga with 2,028 sales and the Canaries with 1,600.

The figures back up evidence from estate agents who say they have seen an increase in the number of foreigners buying property since the start of the year.
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Thanks to a fall in prices, many savers are opting to buy houses outright 1

SpainHouses.netSeptember 16, 2013September 15, 20131 Comment

These days, with the crisis still raging, seven out of every 10 home purchases in Spain are paid in full. Credit has dried up, and most of those properties still being bought up are paid for with savings or donations from family members.

There is another explanation for all the upfront payments: the rise in foreign buyers, who now represent 17 percent of the total, according to figures from the Public Works Ministry. These international clients are paying with funds of their own or with bank loans secured in their own countries.

Before the real estate bubble burst, upfront purchases represented 37.3 percent of total sales, according to the Higher Council of Notaries. That rate has doubled, and in June it represented nearly 68.6 percent of all sales. A study by Pompeu Fabra University (UPF) shows that in the first quarter of 2013, just over 60 percent of transactions did not require a home loan.
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Marbella doubles the number of licences granted for new housing projects

SpainHouses.netSeptember 9, 2013September 8, 2013Leave a comment

The construction sector in Spain in general may still appear to be in a coma, but in Marbella there are further signs of activity in the property market. At least, that appears to be the case according to information from the Town Planning Department, where the number of new building licences granted in the first six months of this year was double that in the same period in 2012. Until June, 123 licences were issued, whereas last year the figure was 64.

The councillor for Town Planning, Pablo Moro, is convinced that this data reflects the fact that the construction sector in the town is beginning to reactivate. “This shows that there is more activity in terms of new building in Marbella and the town continues to be a focus of attention for many investors who now have confidence in it again”, he says.

Although the figures are light years away from those registered before the bursting of the property bubble, the rhythm of growth in applications for new projects does invite optimism and, for some people, it is beginning to dispel doubts about whether the town would, after all, be one of the first in Andalucía to show signs of economic recovery.
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The bright side of the property crisis

SpainHouses.netAugust 12, 2013March 31, 2020Leave a comment

Development madness turned Spain into the European country that created the most urban land between 2000 and 2006, according to a recent study by the European Environmental Agency (EEA). A series of satellite images show that over this period, Spain accounted for 24 percent of all newly developed land in the European Union, followed by France with 12 percent and Germany with nine percent.

The subsequent economic crisis has served to slow down this trend, benefiting green areas and arable land, as well as some of the animal and plant species that live in them. But the real estate bubble has left behind enough land already classified as available to build on to last the next 35 to 40 years at an average annual pace of around 150,000 new housing units, according to the Public Works Ministry's Urban Information System.

That means there are 709,577 hectares of land that could still be rescued and returned to nature.

It is this great pocket of land that environmentalists want to win back by having it reclassified as green space once more, at least in cases where construction is not imminent. It will not be easy because money, or the promise of it, is at stake.
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Benidorm’s prized high-rise tower becomes a symbol of incompetence

SpainHouses.netJuly 29, 2013July 28, 2013Leave a comment

In May 2012, when Benidorm government officials climbed up the InTempo - the European Union's tallest residential building still under construction - for a photo op, they had an idea. The twin towers joined at the top by a cone were to become a symbol of the post-crisis takeoff of the Spanish city of skyscrapers par excellence.

But in late December, with 94 percent of the building completed and 35 percent of units sold, Spain's bad bank, Sareb, announced that it was taking on the loan that a savings bank had extended to the developer eight years ago.

By that time, a construction firm, Olga Urbana, pompously advertised what was going to be "an unquestionable banner of the future." The landmark building would rise meters up into the clouds. The now-defunct Caixa Galicia extended a 92-million euro loan in 2005 - a mortgage that ended up at Nova Caixa Galicia following the merger of Galician savings banks. Now Sareb has assumed the loan for 46 million euros, representing a debt release of 50 percent.

The inauguration was initially scheduled for mid-2009, then pushed back to the summer of 2011. For months, it was evident that no progress was being made at all on the site. But the project's real situation did not emerge until last week, and it is a complex one: although the loan belongs to Sareb, the contract shows that building itself is the property of Olga Urbana, and only a realtor called Maxxima may sell it.
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Temporary injunction against Andalusia anti-eviction decree

SpainHouses.netJuly 15, 2013July 14, 2013Leave a comment

The Constitutional Court on Thursday ordered a temporary injunction against the controversial anti-evictions decree passed earlier this year by the Andalusian government until it can resolve the constitutionality of the measure.

The Rajoy administration filed a suit against the law on June 28. In its ruling, the top court said it was ordering a temporary halt in applying the decree as a precautionary measure until it can study the case.

The decree, passed by the Socialist regional government of José Antonio Griñán, protected the most vulnerable from being evicted from their homes as a result of foreclosures. It also allowed the Andalusian government to take over any empty property owned by the banks and to let people who have been evicted live there for up to three years. The regional government would pay a nominal rent to the banks.
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The construction of luxury homes escapes the crisis and requires qualified workers

SpainHouses.netMay 6, 2013March 31, 2020Leave a comment

There is one construction-based sector where the machines have not stopped working and where at times it is difficult to find qualified staff to carry out certain jobs. With building cranes in hibernation and more than 200,000 people out of work in Malaga province that may be hard to imagine, but it is true. This sector is within in the triangle formed by Marbella, Estepona and Benahavís and last year it generated more than 250 million euros worth of business and about 4,000 jobs, of which 1,000 were direct.

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Andalusia housing chief calls for national evictions summit 1

SpainHouses.netApril 15, 2013April 15, 20131 Comment

The Andalusian chief of public works and housing, Elena Cortés, on Thursday called on the central government to organize a conference involving all the regions to debate the burning issue of evictions.

She also hoped the conference would give the Andalusian regional government the opportunity to explain in detail the new decree on social housing it approved on Tuesday, under which it plans to seize the homes of the needyiest families subject to eviction for up to three years.

Cortés said the central administration has a "golden opportunity" to advance in the same direction by passing the Popular Legislative Initiative on evictions presented in Congress by the Mortgage Victims Platform, which supports dation in payment — canceling a mortgage by handing back the keys to the bank — social housing, changes to mortgage laws and civil lawsuits, and the halting of eviction procedures.

Cortés explained the region's new social housing decree would come into effect on Friday, allowing eligible families to apply for a temporary seizure of their home at one of the housing protection offices it opened in Andalusia's various provincial capitals last October.
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