# The state of the Housing Market - Spain vs UK



## SunnySpain (Jul 30, 2008)

Hiya People,

I suppose its more of a question really.

Do you think the housing market is in a worse state in the UK or in Spain ?

My personal view is that its worse in Spain. I base that on recent reports that suggest the conditions of the housing market are improving slightly in the UK.

Bank of Santander recently made a statement that they are willing to give 100% mortgages again, if property prices are reduced by a further 20%

Has anyone noticed any significant changes in property prices in Spain ?


I also read an article that claims rentals have reduced by an average of 8% in Spain, whilst 50,000 homes have been reposessed by the banks since xmas.

So, there you go, any thoughts on the subject ?

Regards, Dave


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## jojo (Sep 20, 2007)

I think Spain has a long way to fall yet. Property over here had such an artificial rise during the 90s and 2000s, plus in my opinion the construction industry and government got carried away with building more and more and more.... that its now having to settle. I´m sure there are properties that will hold their own, but in the main I predict further fairly hefty falls!!! (gosh listen to me, I sound like I know what I´m talking about LOL)

The UK has been showing signs of picking up and those signs will probably fuel further rises. In my opinion its these rumours and media reports that actually start these things off, just like when it was reported that it was all going wrong... it made it happen, well I think the reverse is starting to happen!!!?

Jo


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## SunnySpain (Jul 30, 2008)

jojo said:


> I think Spain has a long way to fall yet. Property over here had such an artificial rise during the 90s and 2000s, plus in my opinion the construction industry and government got carried away with building more and more and more.... that its now having to settle. I´m sure there are properties that will hold their own, but in the main I predict further fairly hefty falls!!! (gosh listen to me, I sound like I know what I´m talking about LOL)
> 
> The UK has been showing signs of picking up and those signs will probably fuel further rises. In my opinion its these rumours and media reports that actually start these things off, just like when it was reported that it was all going wrong... it made it happen, well I think the reverse is starting to happen!!!?
> 
> Jo


Yes, I ditto the above and would add that whilst property prices have fallen considerably in the UK, its now showing signs of stabilising, thus a recovery
may only be round the corner. The same must happen in Spain before any
real signs of economic recovery come about.

I am sticking to my view that 2011 is likely to be the best time to buy in Spain.

In the meantime, it might be reasonable to assume that the Pound will increase in strength due to such a recovery in the housing market.

Off topic - that circular shaped orange thing in the sky is here again


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## jojo (Sep 20, 2007)

SunnySpain said:


> Off topic - that circular shaped orange thing in the sky is here again


huh!! well send the bloody thing over here, I have two very bored and cold visitors wanting a sun tan!!!!! 

Jo xxx


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## jojo (Sep 20, 2007)

SunnySpain said:


> Yes, I ditto the above and would add that whilst property prices have fallen considerably in the UK, its now showing signs of stabilising, thus a recovery
> may only be round the corner. The same must happen in Spain before any
> real signs of economic recovery come about.
> 
> ...


Well Dave if all your predicitons come true and I think you could be right, then I shall sell my UK house in 2011, buy a spanish place and live happily ever after...!!!

Jo


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## Tallulah (Feb 16, 2009)

jojo said:


> The UK has been showing signs of picking up and those signs will probably fuel further rises. In my opinion its these rumours and media reports that actually start these things off, just like when it was reported that it was all going wrong... it made it happen, well I think the reverse is starting to happen!!!?
> 
> Jo



Let's hope it can be talked up .... we need CONFIDENCE, people!!


Tallulah.x


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## jojo (Sep 20, 2007)

My_Name_is_Tallulah said:


> Let's hope it can be talked up .... we need CONFIDENCE, people!!
> 
> 
> Tallulah.x


Agreed!!!!!

Jo


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## Stravinsky (Aug 12, 2007)

My_Name_is_Tallulah said:


> Let's hope it can be talked up .... we need CONFIDENCE, people!!
> 
> 
> Tallulah.x


But thats exactly whats being done in the UK. From what Ive seen the estate agents have been the ones saying that the house market is on the move and prices are rising. They would want people to think that so the people who have been hanging back will start buying


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## SteveHall (Oct 17, 2008)

Still going down in Spain ...... and I think it's 20% 25% off the bottom. Sadly.


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## jojo (Sep 20, 2007)

My_Name_is_Tallulah said:


> Oh right - I recognise it now!!! (Bit before my time, so you'll have to forgive me!).
> 
> He's a bit of a rocker, Xtreme, ain't he?!


BEFORE YOUR TIME??? Oh, well actually i was only a kid when it came out, it was on the "arrival" album.... my mum bought it!!. Altho I like rock, i dont like that version much

Jo


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## Stravinsky (Aug 12, 2007)

Please reply on the new thread now (off topic thread), not this one


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## jojo (Sep 20, 2007)

I think fairly soon there is going to be a good time to buy in Spain. The UK has more or less stablised after a speedy "hit the bottom", which, in retrospect may have been deliberate, we all knock the UK politicians, financial bosses tec, but hey, surely they MUST know what they´re doing, eventho us mere mortals dont always think they do! Now the UK is having a period of letting the dust settle and then hopefully a slow but sure rise in property and prosperity.

Spain however, has kinda drifted along without appearing to take much notice of whats going on around it. It seems to me that its only recently that the Spanish government have started to admit there is a problem. So there´s still a way to go yet with the property down turn here. There will come a time when it does his rock bottom and that´ll be the time to get in and buy, cos then the prices will turn and things should start to pick up... its predicting when that´ll be thats the hard bit!???? Until then its a time to watch the market carefully and rent rather than buy here?????

There, "Jo´s economic bullitin" on the housing market!!!!!!.... probably wrong, but thats how I see it!!

Jo xx


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## SteveHall (Oct 17, 2008)

Jojo Spain's situation is massively different in that it in effect has two markets and that such a huge percentage of its GDP hinges on construction and tourism and these have been inextricably linked for many years. 

The expat market is in absolute disarray. The prices are in freefall and I think that my fear that they may go another 20/25% may have been optimistic. Talking to a very senior Marbella lawyer last week leads me to believe that there may be another 30/40% to go. Why? Simply that if people are struggling to pay their first mortgages in the UK/Eire etc then the holiday home must go. Punto. You have whole towns built on expat 100% mortgages and now whole urbanisations are in negative equity. Doña Pepa in Rojales is a prime example - 8,000 people with the CAM/EuroMarina and every one willing to do a deal. What can you buy a house there for now? The price of the most desperate vendor. I know a bank manager there very well and he jokes that he feels he should just leave a letter box where people can leave their keys as they flee. It would save his staff spending time on the bad luck stories. 

The local market away from expatshire is also unique in Europe for two factors. One is Spain's huge empty house situation. Spain has over one million empty houses and the fact is that Spaniard's have a history of having two homes. In times of crisis, one can go. Whether this is the beach home, the hunting lodge or the cottage in the country this is even more property flooding the market. 

With the highest unemployment in W.Europe I fear that the bottom is a long long way away.


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## Tallulah (Feb 16, 2009)

SteveHall said:


> Jojo Spain's situation is massively different in that it in effect has two markets and that such a huge percentage of its GDP hinges on construction and tourism and these have been inextricably linked for many years.
> 
> The expat market is in absolute disarray. The prices are in freefall and I think that my fear that they may go another 20/25% may have been optimistic. Talking to a very senior Marbella lawyer last week leads me to believe that there may be another 30/40% to go. Why? Simply that if people are struggling to pay their first mortgages in the UK/Eire etc then the holiday home must go. Punto. You have whole towns built on expat 100% mortgages and now whole urbanisations are in negative equity. Doña Pepa in Rojales is a prime example - 8,000 people with the CAM/EuroMarina and every one willing to do a deal. What can you buy a house there for now? The price of the most desperate vendor. I know a bank manager there very well and he jokes that he feels he should just leave a letter box where people can leave their keys as they flee. It would save his staff spending time on the bad luck stories.
> 
> ...


I believe it is true to say there are two markets currently. One could be deemed "leisure/holiday home market" and the other is the proper "residential" market - I don't think the latter is going to fall much further based on properties currently on the market (proper houses and the larger flats i.e. family appartments). The vendors simply seem to be waiting and are rather stubborn in holding their prices. They obviously don't want to "sell for a song" and so what this will do is simply slow down to a crawl the immobiliaria market. I have seen proof of this with people looking for bargains on chalets/casas with 1000 plus metre plots and they are simply not to be had. Flat by the beach though, dozens of them and well down on a year ago.

Tallulah.x


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## Tallulah (Feb 16, 2009)

My_Name_is_Tallulah said:


> I believe it is true to say there are two markets currently. One could be deemed "leisure/holiday home market" and the other is the proper "residential" market - I don't think the latter is going to fall much further based on properties currently on the market (proper houses and the larger flats i.e. family appartments). The vendors simply seem to be waiting and are rather stubborn in holding their prices. They obviously don't want to "sell for a song" and so what this will do is simply slow down to a crawl the immobiliaria market. I have seen proof of this with people looking for bargains on chalets/casas with 1000 plus metre plots and they are simply not to be had. Flat by the beach though, dozens of them and well down on a year ago.
> 
> Tallulah.x


ps - I think Spain has realised that the days of using more than 50% of all of Europe's cement to keep it's economy going are gone. Things like energia renovable appear to be its focus point and hopefully this will see an end to the very old reliance on construction and a newer, stronger Spanish economy base.


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## SunnySpain (Jul 30, 2008)

My_Name_is_Tallulah said:


> I believe it is true to say there are two markets currently. One could be deemed "leisure/holiday home market" and the other is the proper "residential" market - I don't think the latter is going to fall much further based on properties currently on the market (proper houses and the larger flats i.e. family appartments). The vendors simply seem to be waiting and are rather stubborn in holding their prices. Flat by the beach though, dozens of them and well down on a year ago.
> 
> Tallulah.x


True that, but its also interesting that property prices have hardly budged an inch in certain parts of the North of Spain. Rentals however are certainly down on last year and this is definitely the case in the towns and villages.

The difference between the North and South is quite extreme both in terms of the quality and price fluctuation of properties.

I personally think property prices must be reduced considerably in Spain before any recovery will happen, although maybe its the touristy areas where this must happen first i.e. Costa del Sol

Dave


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## Tallulah (Feb 16, 2009)

SunnySpain said:


> True that, but its also interesting that property prices have hardly budged an inch in certain parts of the North of Spain. Rentals however are certainly down on last year and this is definitely the case in the towns and villages.
> 
> The difference between the North and South is quite extreme both in terms of the quality and price fluctuation of properties.
> 
> ...


Dave,
Definitely supply is way outstripping demand in the Costas. Here in Galicia and the more remote parts of Cantabria have long since had ghost villages where kids do not want to follow in family footsteps of working the land, morning til night, and move to cities. Spain has the kind of square footage space that allows this to happen with property markets not being impacted at all. It wouldn't surprise me if these mega flat builds/zones by the Costas don't end up with a similar fate. 

Tallulah.x


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## jojo (Sep 20, 2007)

SunnySpain said:


> True that, but its also interesting that property prices have hardly budged an inch in certain parts of the North of Spain. Rentals however are certainly down on last year and this is definitely the case in the towns and villages.
> 
> The difference between the North and South is quite extreme both in terms of the quality and price fluctuation of properties.
> 
> ...



Property prices are definately falling around my area - inland costa del sol. Places we looked at over a year ago are still on the market and most have dropped their prices significantly a couple by as much as 150.000€. Yes, they were over priced before, still riding on the dream, but now there is an air of desperation. Its hard to see where it will end for some of these properties???

Jo


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## Tallulah (Feb 16, 2009)

I'm sure there's a huge buy-to-let market in the South, fuelled by the Expatshires. These owners, as with the UK will be the ones deciding what to do with their portfolios and many will face repossessions, I'm sure. At the end of the day, that side of the housing market is pure business and as with other businesses driven by bank loans, some over-stretched, will suffer hardest in the current climate.


Tallulah.x


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## jojo (Sep 20, 2007)

My_Name_is_Tallulah said:


> I'm sure there's a huge buy-to-let market in the South, fuelled by the Expatshires. These owners, as with the UK will be the ones deciding what to do with their portfolios and many will face repossessions, I'm sure. At the end of the day, that side of the housing market is pure business and as with other businesses driven by bank loans, some over-stretched, will suffer hardest in the current climate.
> 
> 
> Tallulah.x


Oddly enough there seems to be a shortage of rental properties around here. I would have thought the opposite. I´m looking at the moment for a possible move to another rented place, so I´ve been looking and apart from one or two rather shabby places, there isnt much out there!!?? why is that?? 

Jo xxx


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## SteveHall (Oct 17, 2008)

..because most people want to SELL and selling with an incumbent tenant is massively more difficult. 

Come to Fuengirola. The whole place is for sale/to let.


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## Tallulah (Feb 16, 2009)

There is another angle : for some time now, risk of non-payment and massive legal hassle to evict vs. keeping it empty and riding it out (both high risk especially for those who have equity and don't particularly want to sell, in effect, their business. I've seen examples where damage done by disgruntled tenants and laws protecting from eviction have made landlords' lives hell. Similar to many years ago, the UK rental market under Labour where the landlord had virtually no rights once the tenants were in and settled. 

Tallulah.x


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## jojo (Sep 20, 2007)

SteveHall said:


> ..because most people want to SELL and selling with an incumbent tenant is massively more difficult.
> 
> Come to Fuengirola. The whole place is for sale/to let.


 Are there any good international schools over there Steve???

Jo


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## SteveHall (Oct 17, 2008)

Place is full of International Schools and many great Spanish ones!


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## jojo (Sep 20, 2007)

My_Name_is_Tallulah said:


> There is another angle : for some time now, risk of non-payment and massive legal hassle to evict vs. keeping it empty and riding it out (both high risk especially for those who have equity and don't particularly want to sell, in effect, their business. I've seen examples where damage done by disgruntled tenants and laws protecting from eviction have made landlords' lives hell. Similar to many years ago, the UK rental market under Labour where the landlord had virtually no rights once the tenants were in and settled.
> 
> Tallulah.x


I´ve got an estate agent friend (no, not Steve lol) who is actually going round to all his "vendors" asking them if they wanna rent and trying to "big up" the idea of renting to buy, which is partly why I´m looking round... I may buy... eventually, if the deal is right. 

Jo


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## Tallulah (Feb 16, 2009)

jojo said:


> I´ve got an estate agent friend (no, not Steve lol) who is actually going round to all his "vendors" asking them if they wanna rent and trying to "big up" the idea of renting to buy, which is partly why I´m looking round... I may buy... eventually, if the deal is right.
> 
> Jo



Best of luck - don't forget if you do find your ideal place (especially during the summertime), don't execute the "buy" option until after the winter months when any of your much publicised dislikes of winter in Spain have been put to rest by this miracle home which is warm, well insulated and affordable to heat!!!!

Tallulah.x


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## jojo (Sep 20, 2007)

I spent the day today looking at properties, mainly rental or rent to buy. Not sure what I think really. The rents were all negotiable, the properties had ALL been empty for at least 4 months, so I think the owners are fairly keen to get someone in them. As for buying them at the end of the term, well they ALL wanted silly money... no way 600,000€ for a rather tatty, small three bedroom finca??????! The owners were all Spanish and werent prepared to drop their prices at all.. well not today. 

It was interesting to look around at whats out there... actually not much, there doesnt seem to be much of the sort of property I´m looking at and I dont think there are many potential tennants either????

Jo xxx


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## XTreme (May 17, 2008)

You want to look in a nice rural area like this Jo!


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## jojo (Sep 20, 2007)

XTreme said:


> You want to look in a nice rural area like this Jo!



too cold for me where you live Extreme!! I hate the cold!!!!

Jo xx


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## SteveHall (Oct 17, 2008)

That's a nice way of saying, "I don't like donkeys and I am keeping my 3 eldest daughters well away from you, XTreme." 

Jojo has obviously been to the Kissinger School of Diplomacy or was it the Kiss'n'Tell School.

Can you give me lessons, Jojo? I think I had better go and smooth things over with a xxxx gestor who got in my way today!!


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## jojo (Sep 20, 2007)

SteveHall said:


> That's a nice way of saying, "I don't like donkeys and I am keeping my 3 eldest daughters well away from you, XTreme."



Extreme would be no match for my three older daughters, they´re very worldly wise and quite terrifying. Dunno where they get it from!!!

I was gonna say they´d chew him up and spit him out, but didnt think it was an appropriate expression LOL!!!!!


Jo xx


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## XTreme (May 17, 2008)

jojo said:


> too cold for me where you live Extreme!! I hate the cold!!!!
> 
> Jo xx


It's not just cold here though....we've got other attractions too!

Incest, bestiality, and Gitanos defecating in the middle of the road! Absolutely true! Just another day at the office!


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## jojo (Sep 20, 2007)

XTreme said:


> It's not just cold here though....we've got other attractions too!
> 
> Incest, bestiality, and Gitanos defecating in the middle of the road! Absolutely true! Just another day at the office!



Oh you should have said, I´ll be over!!  

Jo


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