Well I am on final countdown now. Unfortunately baby is breech so may have to have a cesarian on Wednesday - after two textbook natural births, this outcome was quite unexpected. Although baby may still decide to turn last minute.
Now I am planning everything for Wednesday including trying to finish my website -which will happen first I wander - baby´s arrival or completion of the website.
My girls are so excited and dying to see baby - now we´re finally on the last stretch!
Sunday 24 June 2007
Wednesday 6 June 2007
The Spanish Propety Market
On my bedrest, I have given some thought to the present situation of the Spanish Property Market.
True the market now is a lot quieter but there are still opportunities out there. The hit and run investors have left - but there are many people who still come to Spain because they love the lifestyle.
Every market has its peaks and troughs and I believe that this correction is probably much needed. Do we have to look at it negatively?? No, I dont think so, there are still opportunities out there. Buyers just need to do their homework and look out for the bargains. Below are some of my thoughts put on paper.
Should we be nervous?
Recent accounts of the Spanish property market have sent alarm bells ringing through the European Investor Community. Scare mongering stories could actually trigger off a self-fulfilling prophecy whereby anticipation of events will only cause the predicted events to occur.
During the last decade, the Spanish Property Market has seen exceptional growth. However over the last three years the rate of increase has dropped from a 20% increase in property prices per year to around 10% per annum. In any economy there are peaks and troughs. In reality what we seem to be seeing is a market correction and leveling off rather than a drastic fall.
Realistic or Unrealistic?
The price increases that we have seen as of late have been seller-led and have in many cases not reflected ‘true market value’. Numerous private sellers have a preconceived idea of the ‘market price’ for their homes. Unfortunately, many a time these prices are reached through a combination of subjective (eg what their neighbour is selling for) factors rather than sound factual indicators. Market valuations should be objective, based on a simple rule of thumb as that applied by banks (price per square metre in a given area multiplied by registered square metres). In practice however sellers often ignore this rule of thumb and let external factors play a large part in their price setting. Similarly, many developers have jumped on the band wagon of escalating prices and there are thousands of mediocre apartments being sold off-plan at extortionate rates.
Is Correction a good/bad thing for the Spanish Economy?
The correction that we are seeing is not a bad thing. The property market as of late has been growing due to seller expectations rather than real factors. However the increased supply of housing on the Costa del Sol coupled with recent interest rate hikes are forcing developers and sellers to price their properties at more competitive rates.
Despite current market sentiment, Spain is still one of the most attractive destinations in Europe due to its climate, culture and location. There is still a buoyant demand out here, and whilst the demographics of the average buyer has shifted, from speculators wishing to make short term gain, to consumers wishing to live and build a business in the area, the latter is creating a more solid foundation for long-term economic growth.
Much of what we are seeing is a mismatch between supply and demand. Whilst some developers have been building box-like apartments, many of our clients are looking for qualities they would expect to find in a full-time home: storage space, decent sized rooms and parking facilities.
A Buyers Market
Today’s clients are doing a lot more research and are still able to find quality developments and well priced re-sales.
For those of you looking to buy on the Costa del Sol, this just may be the perfect time to look for a bargain. As put by Mark Stucklin, Spanish Property Doctor for the Sunday Times:
‘If you are really willing to do your homework, the market wobble could be a good time to hunt for a bargain – and now is the best time in a decade to drive a hard deal. Remember, smart buyers look at whether or not a property represents value for money, not just how cheap it is.
True the market now is a lot quieter but there are still opportunities out there. The hit and run investors have left - but there are many people who still come to Spain because they love the lifestyle.
Every market has its peaks and troughs and I believe that this correction is probably much needed. Do we have to look at it negatively?? No, I dont think so, there are still opportunities out there. Buyers just need to do their homework and look out for the bargains. Below are some of my thoughts put on paper.
Should we be nervous?
Recent accounts of the Spanish property market have sent alarm bells ringing through the European Investor Community. Scare mongering stories could actually trigger off a self-fulfilling prophecy whereby anticipation of events will only cause the predicted events to occur.
During the last decade, the Spanish Property Market has seen exceptional growth. However over the last three years the rate of increase has dropped from a 20% increase in property prices per year to around 10% per annum. In any economy there are peaks and troughs. In reality what we seem to be seeing is a market correction and leveling off rather than a drastic fall.
Realistic or Unrealistic?
The price increases that we have seen as of late have been seller-led and have in many cases not reflected ‘true market value’. Numerous private sellers have a preconceived idea of the ‘market price’ for their homes. Unfortunately, many a time these prices are reached through a combination of subjective (eg what their neighbour is selling for) factors rather than sound factual indicators. Market valuations should be objective, based on a simple rule of thumb as that applied by banks (price per square metre in a given area multiplied by registered square metres). In practice however sellers often ignore this rule of thumb and let external factors play a large part in their price setting. Similarly, many developers have jumped on the band wagon of escalating prices and there are thousands of mediocre apartments being sold off-plan at extortionate rates.
Is Correction a good/bad thing for the Spanish Economy?
The correction that we are seeing is not a bad thing. The property market as of late has been growing due to seller expectations rather than real factors. However the increased supply of housing on the Costa del Sol coupled with recent interest rate hikes are forcing developers and sellers to price their properties at more competitive rates.
Despite current market sentiment, Spain is still one of the most attractive destinations in Europe due to its climate, culture and location. There is still a buoyant demand out here, and whilst the demographics of the average buyer has shifted, from speculators wishing to make short term gain, to consumers wishing to live and build a business in the area, the latter is creating a more solid foundation for long-term economic growth.
Much of what we are seeing is a mismatch between supply and demand. Whilst some developers have been building box-like apartments, many of our clients are looking for qualities they would expect to find in a full-time home: storage space, decent sized rooms and parking facilities.
A Buyers Market
Today’s clients are doing a lot more research and are still able to find quality developments and well priced re-sales.
For those of you looking to buy on the Costa del Sol, this just may be the perfect time to look for a bargain. As put by Mark Stucklin, Spanish Property Doctor for the Sunday Times:
‘If you are really willing to do your homework, the market wobble could be a good time to hunt for a bargain – and now is the best time in a decade to drive a hard deal. Remember, smart buyers look at whether or not a property represents value for money, not just how cheap it is.
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