Everyone would love to have their very own Spanish Property whether it is for permanent living or simply for a holiday home in Spain, a few years ago prices hit unbelievable heights and property investors made massive returns on their homes in the sun. Not only were prices way above what anyone ever expected but they also made properties unreachable and hard to finance. However … now that the bubble has burst, Spanish Properties are more affordable than ever. Valuations of properties in Spain have fallen to the lowest levels for many years, making your dream of purchasing a home in Spain where ever you desire more reachable than ever before.
Many people chased the dream of buying a house in Spain during the boom years, finance was easily available through any of the Spanish banks and buyers took on mortgages that in hindsight should never have been approved. Now with the worldwide economic slowdown and credit crisis that has hit not only Spain but the rest of the world, many second home owners in Spain are now feeling the pinch and looking to off load their Spanish property for a fraction of what they may have paid for it a few years ago.
Unfortunately, these property owners have little or no choice but to get what ever they can to pay off the outstanding mortgage and relieve themselves of debts that may affect them and their assets in their own country of residence. The main reason for most of the “distressed Spanish property sales” is simply because they can not afford to keep repaying their mortgage or in some cases – personal situations that arise. More often than not though, it is the financial burden of paying a mortgage on a property that is in negative equity and the difficulties of paying two at the same time.
Because of these reasons, properties that are marketed as distressed Spanish properties are most often open to negotiation putting the buyer in a very strong position to bag a bargain property in Spain, simply due to the seller needing a quicker than usual sale. This is definitely a very normal situation that people find themselves in at the current time, making Spain the ultimate buyers market.
Just like distressed sales, factors of both personal and financial problems result in properties being repossessed. Repossessions in Spain are growing by the day, however they are sometimes not such an attractive purchase to a buyer due to the how much money the property in question owes the bank after repossession. Banks must take their fair share of the blame when it comes to the “what went wrong in the Spanish property market” question! Properties were seriously over valued, often 110% mortgage deals were advertised here, there and everywhere to tempt potential buyers. The situation has now back fired on many of the Spanish banks, leaving them lumbered with over valued properties that either no one wants or can afford.
Rumour has it, that all of best value repossessions never see the repossession brochures that are available at your nearest bank, simply because employees and investors get first picks on properties that are reclaimed by the banks. Whatever way you look at it, there are thousands and thousands of repossessed Spanish properties available should you wish to see what’s on offer!
Another concept that has received a lot of publicity in recent months are the auctions taking place around Spain, the BBC recently documented one such auction in the Costa del Sol, sellers pay a rather large commission to the auctioneer and the buyer only pays the price set after the hammer falls! Again, properties that come up for auction are very limited, so monitoring the latest available properties is paramount to you acquiring the property of your dreams and in the location you wish to be situated.
Many people ask – what can we expect in the future in regards to the Spanish property market? Statistics from trustworthy sources state that there is more or less one million empty homes across mainland Spain and the Spanish Islands, the new developments industry will take years if not a decade to recover, especially as it will have to wait until the resale market is fully operational and that the demand is back within Spain, but that is much further down the line, years! Prices will never hit the heights that they once did, all the uncertainly has surely put many people off buying especially investors, but then again – it’s not only Spain that will worry property investors.
Spain will always remain a first choice holiday location because of how close it is for the colder northern European countries, many retirees will wish to enjoy their retirement in a warmer climate and will also benefit from the cheaper cost of living. The Spanish way of life has to be experienced to be appreciated! A country steeped in history and tradition!
So if you are looking for quality of life, great weather, enjoyment and relaxation as well as lower prices then Spain is still the perfect place to purchase a property. Forget investment, purchase a property in Spain for all the right reasons!