propiedades

Spanish Property Market – as it stands

March 27, 2013
Property News
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España, marketplace, mercado inmobiliario, property, propiedades, Spain

LPG Spain was recently approached by the web site, Spain Made Simple, asking us our opinion on the current state of the Spanish property market for their newsletter.

We were more than happy to oblige. Here are their questions along with our answers:

Q. Are property prices in Spain going down, up or stabilizing?

A. Spain’s property market is now into its seventh year of recession. During this time prices have dropped significantly from the heady heights of pre 2007, prices of which many claim, had to drop. During this period, many thousands of estate agents, developers and builders have disappeared, leaving a hard core of professionals still struggling to survive. However, price performance has varied considerably in different parts of Spain depending primarily on its clientele, domestic or foreign.

Within the domestic market, Spaniards have seen the bottom drop out of their market with prices coming down up to 60% in some areas as banks haul in repossessions and unsold new stock from developers that have gone out of business. Added to this, the banks are also offering 90% + mortgages to the Spanish who buy any of their stock.

On the other hand, coastal regions have fared much better as the majority of buyers are from overseas. Whilst it‘s been a complete buyers market over the last 4 – 5 years, where purchasers have been offering very low bids on property already drastically reduced, there are regions that are now beginning to recover, which leads me to the next question…

Q. Who represents the main buyers now, is it the Spanish or has another foreign market taken over from the British?

A. The Costa Blanca reports thriving business from the Russians. The Costa del Sol has been almost invaded by the Scandinavians, in particular those from Sweden and Norway, whilst the British, historically the nation that has purchased more property in Spain than anyone, is still a little conspicuous by their absence, although in the past six months have shown an increase in property purchases in Spain.

As an Estate Agent on the east Costa del Sol, in Nerja, Edwards Estates also employs Swedish staff, and can attribute 75% of sales last year to this market. We would also go as far as to say that during the course of this winter, the problem that we are having is not a shortage of clients, but a shortage of quality and well priced property. This indicates that the majority of prices in our area are still overpriced, in the eyes of the purchaser, but property that is priced well for the region is selling quickly.

Concluding, we see that 2013 may be the year that prices do stabilize in areas that are in demand, whilst the Spanish domestic market will continue to suffer with even further reductions in price added to the main problem for potential buyers, uncertainty in the job market and the unemployment situation, currently at over 5.000.000 people, still rising and expected to reach 27% of the active working population this year, more than fifty percent of which are people under the age of 30. Not an easy situation for those trying to get onto the property ladder.

Robert Edwards – Administrator of LPG Spain.

Foreign House Buyers in Spain up 28.4 pc in 2012

March 5, 2013
Property News
3 Comments
España, property, propiedades, Spain

A total of 38,312 foreign, non-resident nationals in Spain bought a home last year. This represents an increase of 28.4% compared to 2011, according to the Notary Association. 42% of the transactions closed at a price above 160,000 Euros.

By region, Murcia and Andalusia are the two regions where the number of buyers has fallen, whilst Catalonia last year recorded more than twice the number of buyers as compared to 2007. The origin of new homeowners has also changed, because for the first time the Russians represent the second largest volume of homebuyers, behind the British.

Regarding prices, 42% of transactions closed for an amount in excess of 160,000 Euros, precisely the figure that the Spanish government has set as a recommended amount in order to grant residence permits to foreigners who purchase a home in Spain. This however, is still subject to final legislation by the government.

Buy a house in Spain and obtain a residence permit.

House prices in Spain fall by 15.2% in the third quarter, the biggest drop since 2007

December 14, 2012
Property News
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España, House prices in Spain, Precios de la vivienda en España, property, propiedades, Spain

The price of housing in Spain has fallen by 15.2% in the third quarter of 2012 compared to the same period last year, which means a decrease of eight tenths, as provided by the price index from the National Institute of Statistics.

The decline in the price of new houses has fallen by 13.6%, eight tenths less than the previous quarter. In terms of resale properties the inter-annual variation was seven tenths, a fall of 16.4% in the third quarter. These rates are the lowest since the statistics started in 2007.

Prices in Spain have now fallen consecutively over the last five years returning negative variations. Prices started to drop in the second quarter of 2008 (-0.3%) and since then the trend has not yet been reversed.

Autonomous Regions of Spain

When looking at house prices across Spain, prices have dropped in all autonomous areas with the exceptions of the Balearic Islands where they have reversed the trend and risen by 1%, in Andalucia +0.3% and the Basque region +0.3%.

Property tax on foreign companies that own a property in Spain to be abolished

December 8, 2012
Property News
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Foreign companies in Spain, Foreign owned property in Spain, impuestos, property, Property taxes, propiedades

The Spanish government is proposing to abolish a tax that is currently levied on foreign companies owning property in Spain in order to attract more investment from abroad.

The tax currently stands at 3pc per annum of the company’s holdings in Spain. The change in the law, currently going though the Senate, is expected to come into force early next year but will only benefit companies that are not domiciled in tax havens.

The tax was originally introduced to stop property ownership through foreign companies when at the time, there was no tax at all, and the government gained nothing. Furthermore, when a property in Spain was sold which was the only asset to the company, there was no change in ownership of the property in the land register, as the company was sold and not the property, and therefore none of the taxes associated with the sale were made either. By removing the tax, it can be easier and cheaper to buy, sell, and inherit property in Spain through a foreign company, rather than face the cost and hassle of doing the transaction in Spain.

This of course will benefit those people wishing to purchase property at the top end of the market as the cost of maintaining a foreign company would not be beneficial to the holding of low priced property.

Nevertheless, it is another gesture by the Spanish government to move the enormous stock of unsold property currently in Spain.

Just one month remaining to save VAT on a property purchase in Spain

December 1, 2012
Property News
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España, impuestos, IVA, property, propiedades, Spain, taxes, VAT

With just one month remaining before the VAT on the purchase of a New property in Spain increases from the current 4% to 10% on 1^st January 2013, there is still time to benefit and save money.

In order to save paying this increase you must complete the purchase of a new property by signing the title deed before a notary prior to 31^st December 2012.

What is a new property?

A new property is one that has never been registered to a first time buyer, i.e. that from a developer, a builder or even a re-possession from a bank as long as it has never been registered for the first time to a purchaser.

Despite many things taking time to accomplish in Spain, buying a property can in fact be extremely quick – just 7 days! Once having decided to purchase a New property, all paperwork can be checked by a lawyer, searches made at the land register, and all necessary appointments made at the notary all within 1 week. As long as the vendor and purchaser (or their notarised legal representatives) and funds to purchase are available, the property can be signed before a Notary within this time frame.

So if you’re still pondering and want to save 6% on your purchase costs, there’s still time to do so.

Here are some examples of New property in and around Nerja where you can save the 6% VAT before the end of the year:

2 Bedroom, 2 bathroom luxury built apartments in Torrox Costa with private underground parking spaces and lock-up storage room and 2 communal swimming pool complexes from just 195.000 Euros.

Average house price in Spain fell by 16.5% in August, according to the Notary Association

October 16, 2012
Property News
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España, house prices, precio de la vivienda, property, propiedades, Spain

Based on figures from the previous year, the Spanish Notary Association claim that Spanish house prices fell by 16.5% in August, down to just 1.176 €/m2, with apartments dropping by 19.7%, and houses by 8.2%.

New properties came down by an average of 20.4% whilst resales dropped by 24.2%. Again, according to the same source, they claim that prices in general have dropped by 36.5% since the crisis began in 2007, a figure that other sources might dispute, claiming that prices have dropped by more than 40%.

Many claims are made by different organizations and government departments across Spain, often based on different sources with quite different results. However, given that all property transactions in Spain have to be completed before a notary, it’s reasonable to assume that their calculations can be considered more accurate.

Nerja Property Sales

September 22, 2012
Costa del Sol East, Nerja News, Property News
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nerja, property, property in Nerja, propiedades, ventas en Nerja

Nerja is without doubt the most popular destination east of Malaga with an all year round climate, a comfortable and relaxed lifestyle, great communications – Málaga’s international airport is just 40 minutes drive along the motorway, Granada city and Sierra Nevada ski resort just over an hour away, and Nerja is renowned world wide for its famous Caves.

Unlike many coastal resorts in other parts of Spain, Nerja is open all year round. You can have lunch on the beach in Nerja on Christmas day as well as any other day of the year. The town is very manageable with a local population of around 26,000 people (registered) but which is slightly more due to many foreign residents who live temporarily during winter months.

Given the current economic climate and the fall in Spanish property prices, Nerja continues to attract buyers seeking a bargain. Not all visitors to Nerja however purchase a property, but rent one. Long term rentals, over a period of a standard eleven months are extremely popular of late as would-be buyers prefer to rent first, study the market and purchase later.

Naturally, Nerja is also a very popular holiday resort with a great selection of all types of accommodation, many beaches both in the town and along the scenic coastline surrounding the town.

There is a host of cozy restaurants offering all types of cuisine especially of course, fresh fish and tapas, many boutique shops, hotels and guest houses (hostals), banks, etc. There are all sorts of outdoor activities… visit the typically Spanish inland villages such as Frigiliana and Competa, go hiking or cycling in the mountains, horse riding, fishing or just laze on the beach!

If you are interested in visiting Nerja check out our holiday rentals section.

Looking for a longer period? Then try long term rentals in Nerja.

And if you’re convinced that it’s the time for you to purchase in Nerja, take a look at our properties for sale.

Tourist information about Nerja with some great HD videos.

Guide to purchasing a property in Spain.

Long term rental terms and conditions.

Luxury size detached villa building project for sale in Cerro Gordo in La Herradura

September 12, 2012
Costa Tropical News, La Herradura News
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chalet en venta, la herradura, property, propiedades, villa for sale

A fully licensed building project and plot to construct a luxury size detached villa in a stunning location in Cerro Gordo within the municipal area of la Herradura in the province of Granada.

The price has been reduced again to 395,000€ which makes this very viable financially.

The shell of the house is built, on three floors, on a plot of 1.000 m2, with stunning views across the national park of Cerro Gordo and all the way west down and along the coast to Nerja and Malaga in the distance.

This is a unique spot in an up-market neighbourhood in a highly protected area. This site is better located than anything else on the market in this area yet compares very favourably with them on price.

Plans shown in the photographs (see link below) are those which have been passed by the local Almuñecar town hall, which can be modified and re-applied for to suit the preferred layout of a new purchaser.

One possibility is to build out something quite unique which could maximize the living and financial potential of the site. This would be a home that is warm in winter, cool in summer, without burning money or fossil fuels. This energy efficiency and comfort would be achieved through thoughtful design creating living spaces that allow the outside inside, maximizing the enjoyment of the views, while protecting you from the harsh summer sun.

The company we have in mind for this believe that thoughtful design can a positive impact on your quality of life. They create micro climates for different moments. Some terraces are always in full sun, others in dappled shade and there are secluded corners with cooling water and lush plants: design to make life simpler, healthier, and more beautiful for you.

All of these features and more could be applied to this villa for sale. The design and build company we have in mind would be happy to discuss costs with you and they understand that the value of the finished home must be more than all the costs of acquiring it and finishing it to your personal specification.

Read the full description together with more photographs and map location.

Do you rent in Spain? Whether a tenant or a landlord, read this!

August 24, 2012
General News, Property News
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alquileres, España, property, propiedades, renting, Spain, vivienda

The new law of “Promoting the Housing Rental Market” in Spain, which the Spanish government has given the green light to on Friday 24th August, includes a series of legislative changes designed to ease the fears of many owners who rent their properties.

The changes (a date as yet unknown by when the new legislation will take effect) remove many of the rights that previously guaranteed the protection of the tenants against landlords, which naturally has raised many questions among those owners who rely on renting for a living.

(Please note that the following Q&A’s refer to the general laws of renting in Spain. This article does not cover the circumstances surrounding “temporary” contracts found in many coastal regions of Spain, more popularly known as 11 month contracts. We will publish soon a separate article on this matter.)

What if I can’t pay the rent? If your contract does not require you to pay any compensation, you can leave the property with one month’s notice (until now it was two). According to the Minister Ana Pastor, these are some of the benefits of this new measure: it allows you to leave the house in case you are no longer able to pay. If you still do not pay the monthly rent, things will remain as per the last legal reform approved in October 2011: your landlord may go immediately to a court where the judge will give you a period of ten days to pay, leave the property or submit a claim in your defence. The main change in the new law is that by paying the outstanding rent, this will no longer be sufficient to stall the proceedings. Furthermore, the aim is to reduce the bureaucracy involved in the legal proceedings so that the eviction can take place in a shorter time . So, instead of a decree issued by a clerk of the court, the judge’s decision is now final and takes immediate effect. Furthermore, in order to execute the eviction (on the premises) only one judicial officer need be present, instead of two that were needed so far.
I have a lease for three years ending in December. I want to continue living in the property. Will the changes in the law affect me? (Note that this question relates to rental contracts that are not governed by the “temporary” clause that appears in many contracts in tourist areas, i.e. 11 month contracts). So far, all contracts for less than five years were automatically extended each year up to a maximum of five years (the so-called “forced” extension by Spanish law) if the tenant had not communicated to the landlord his intention to leave. After those five years, if neither the landlord nor the tenant had indicated their willingness to terminate the contract, this was again extended annually (the so-called “tacit” or automatic extension) to a maximum of three years. Under the new law, the forced extension is reduced from five to three years, whilst the tacit extension is reduced from three to one. So, if your agreement ends in December and the law is passed by then, your landlord may indicate his desire to terminate the contract. Your landlord may also revise the value of your deposit.
I’ve been living two years in an apartment. My landlord lives abroad, but his daughter will start college in my town next year. Can my landlord kick me out of the property? Yes. So far, the landlord’s right to recover the property for personal use should be expressly stated in the contract. If it was not, the landlord must wait for the “forced” extension period (five years) before asking you to leave. The new law will allow the landlord to evict the tenant at any time for personal use or for use by an immediate member of his family, such as a son or daughter, with two months’ notice.
My landlord wants to sell the property. Will the new law force the new owner to honour the contract? Only if the rental contract is registered in the Land Registry. So far, in general, the new owner must honour the contract to meet the extended “forced” deadline (five years). Under the new law, if the contract was not registered in the Land Register, the new owner is entitled to recover the property immediately. The registration of rental contracts in the Land Registry has been, until now, a cumbersome and expensive process involving a notarized deed. The ministry has already announced its intention to cheapen and ease the procedure.
I want to reform the kitchen of my rented property. Can I ask the owner to lower my monthly rent? In principle, yes. The Government has announced that the new law will allow improvements made by the tenant to apply to and form part of the rent.
I am going to rent a property. To what extent will the changes in the law affect me? The government wants to provide more freedom between the landlord and tenant to sign a contract in the most mutual and beneficial manner to both parties. So far, the annual review of the rent was indexed to the official annual rate of inflation. Under the new law, the landlord and tenant may agree other review mechanisms. Furthermore, so far, if the landlord put his property up for sale, the tenant had a first right of refusal at the price that the landlord offered his property to a third party. The new law will allow the tenant to waive that right, “and negotiate a lower rent” according to the minister.

UPDATE:

28th August: It would appear that the above proposal will take some time to legislate through the Spanish parliament where final changes could still be made and could therefore take some months before becoming law.

Long term rental properties east of Málaga, throughout Axarquia and along the Costa Tropical.

56% of Brits looking for a Spanish property want to buy

August 16, 2012
Property News
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Brits, España, property, propiedades, Spain

56% of Brits interested in the Spanish property market are looking for opportunities to buy, according to a study by the Spanish agency inmoaction.com.

The study, from more than 1,500 people that were interviewed between April and July, also revealed that up to 20% of potential investors were looking for cheap priced property with a view to letting out.

“Overall, the British interested in the Spanish market are seeking medium to long term investments providing a stable performance with minimal risk. For this reason the fall in prices in Spain is an incentive for the buyer,” adds the agency.

In 2011 British foreign citizens invested more than any other nationality in Spain with 4.004 property acquisitions. In 2012 interest has increased due to continuing price reductions and reports of low-cost apartments in Spain, the report said.

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