Spain Real Estate News

British property investors are still showing considerable interest in buying real estate abroad despite the recession, according to the latest figures from an international search website.

Spain is the number one search destination, pushing France into second place, according to the latest figures from primelocation.com. Bargain prices in Spain are believed to be the reason it has sprung to the top of the list although it has always been very popular with UK investors.

Searches for properties in Spain have increased 27% year on year. The country now accounts for 30.53% of international searches. France is the second most popular with 27% and the US in third place with 14.34%, that's up 87% compared to May 2008 and could be due to bargain properties in Florida.

Searches in Portugal have also increased by 15% since May 08 and by 12% since April 09 while Italy is showing a 13% increase in searches since May 08. Italy is in fourth place with 6.24% of searches, followed by Portugal with 5.93%

Interest in Switzerland has also increased 20% year on year, possibly fuelled by the recent increase in income tax for top earners in the UK

Former popular areas for British investors such as Cyprus and Bulgaria still record only a tiny part of overall searches at 1.26% and 0.75% respectively.

The United Arab Emirates is in sixth place with 1.73%, turkey in eighth place with 1.18% and Australia in ninth place with 0.93%.

'Although the market is slow there are still buyers and investors out there with an interest in certain areas. Many will be looking to take advantage of the reduced property prices,' said Ann Wright, International Development Manager at Primelocation.com.

 Source: PropertyWire

MADRID, June 26 (Reuters) - Spanish banks and builders desperate to get rid of unsold buildings are jumping on board a new scheme to offload it -- a bus tour showcasing property so cheap that sellers don't want to be identified.

Under the strict cover of anonymity so as not to appear desperate, banks selling defaulters' assets and builders on the verge of going bust have teamed up with canny entrepreneurs to shuttle investors around blocks of flats, empty shops and offices being offered at half price or less.

The idea, which organisers say is the first of its type in Europe, has already been running for 1-1/2 months around the resort town Marbella and has sold 20 percent of the properties on its books -- not bad for a market that has been virtually paralysed for the past year.

"It's such a simple idea and just snowballed," said Africa Leon, whose promotions company Circulo Financiero Internacional organises the tour.

The first stop on Thursday's inaugural Madrid bus is a block of 20 flats near the city centre, selling for between 160,000 and 200,000 euros -- half the original price tag.

The building was repossessed from the developers by one of Spanish savings bank, known as 'cajas', which have been badly hit by Spain's property market collapse.

The tour went on to two vast apartments in the up-market Salamanca district of Madrid, a 2,000 square metre shopping centre going for 9 million euros and another block of flats.

Victoria Ansola, a property consultant who normally seeks out Costa del Sol apartment blocks on behalf of German and U.S. funds, was a fan of the bus.

"It's comfortable, they take you around, you can get five appointments in an afternoon, and then you can return and negotiate," she said.

POWER TO THE PEOPLE

Anyone can get on the bus and lawyer Emilia Zaballos, who specialises in organising young people into buyer groups with greater clout, said the idea could change the old rules of a game that has favoured professional investors up to now. "It's totally innovative. This is not just for investors. Anyone can access these kind of bargains. Who normally gets access to these things? Up until now those with the information and the money."

From 1997 to 2007, Spanish house prices tripled on a wave of domestic and foreign speculative buying. Official statistics showed a 5.4 percent decline in the fourth quarter of 2008 but market players say these figures underplay the retreat in prices which has, in any case, greatly accelerated in 2009.

Property companies' biggest problem is slow sales.

Zaballos said seven builders and real estate firms had filed for administration at her small practice in 10 days alone -- straddled with debts and without income as banks refuse to offer mortgages to buyers they had already signed up. (Reporting by Ben Harding; Editing by Karen Foster and Andrew Macdonald)

Source: Reuters

 Figures released by the Spanish Ministry of housing have shown that only 484 properties were sold to foreign nationals in the first three months of 2009, illustrating the depth of the property downturn on the Iberian peninsular. The figures, which indicate a sharp drop in the properties sold to foreigners, also illustrate the overall housing situation in Spain.

* 614,000 completed new homes left unsold

* Analysts say number less than forecast

* Another 627,000 still in construction

* Building tycoon abandons infamous project half finished

MADRID, June 12 (Reuters) - Spain had 614,000 new homes sitting unsold at the end of 2008 -- lower than most analysts' estimates -- according to the first major survey of Europe's most over-stocked home market.

Almost half of those are clustered on the over-developed coast according to the housing ministry study, which surveyed or visited 6,810 real estate companies -- around 70 percent of a sector that is shrinking fast in the face of one of Europe's most savage property downturns.

The survey is the first attempt by any public or private body to pin down the size of Spain's unsold stock -- estimated at over 1 million homes by some economists -- using a methodology similar to the respected Royal Institution of Chartered Surveyors (RICS) study of the UK market.

"The survey looks good to me, very representative and well designed," said Jose Carlos Diez, an economist with Intermoney in Madrid. However, he added the figure was still represented a serious challenge despite being below many estimates.

"You should not lose perspective, the figure is less than expected, but 600,000 homes is still a lot of homes." At the current rate of sale, the stock will take around three years to be run down while Spain's housing market -- the former motor of economic growth -- suffers a hangover after a 10 year boom. In that time prices tripled and huge tracts of the coast in particular were disfigured by rows of uniform apartment blocs.

In 2007 alone Spain built 690,000 new homes -- as many as France, Britain and Germany combined -- even though underlying demand is normally less than half that. Now hundreds of builders are going bust every quarter amid a 34 percent dive in sales in the year to date and their assets clog up banks' asset sheets.

The survey published on Friday also notes that Spain had 627,000 homes in the process of construction at the end of 2008 -- 70 percent of them almost finished and 39 percent already sold.

PACO PACKS IT IN

The study comes after news one of Spain's best-known building tycoons has abandoned what would have been Spain's biggest development built by a single firm -- a maze of tower blocks containing 13,500 flats outside the small village of Sesena on the red-dirt plains of central Spain.

Spanish press reported that Francisco Hernandez, known by his nickname 'Paco the well-digger', walked away from the project after building 5,600 of the flats but not road, power or water connections which the local council estimates will cost 18 million euros.

Newspapers quote Hernandez, who is as much known for his opulent lifestyle as the massive development south of Madrid, saying the local council would not give him the necessary licences to finish the project which is sandwiched between two motorways on the site of a former olive grove.

Neither Hernandez nor the mayor of Sesena were reachable for comment on Friday. (Reporting by Ben Harding; Editing by Toby Chopra)

Source: Reuters

England World Cup star Sir Geoff Hurst is leading a £2million High Court claim against Spanish property developers.

Hurst has joined forces with five others, each of whom claims they have lost hundreds of thousands of pounds investing in luxury apartments near Marbella that will never be built.

Olympic rower Sir Steve Redgrave and former England rugby star Tony Underwood endorsed the projects along with Hurst before finding some investors had lost their deposits when schemes were scrapped.

The three had invested in the Royal Marbella Group.

The sportsmen say that while some of its schemes were completed, others - including Lince Sanctuario near Seville, where Redgrave invested £2million in an off-plan villa - will never see the light of day.

Redgrave and Underwood are not among the claimants in the High Court action.

Five years since investing in the projects, the land has changed hands and the current owners will not recognise the contracts of Hurst and the other investors, the legal action claims.

Hurst invested in an off-plan apartment at the former Royal Marbella development in Manilva on the Costa del Sol.

However, construction work will not go ahead as building licences were illegally issued by mayor Pedro Tirado, who was later jailed for accepting bribes.

'I am angry at the lies I was told,' said Hurst. 'I am determined to take action to recover the money we lost.'

Source: Mail online

Spanish mortgage lending dropped 37.4 percent year-on-year in March, taking new loans to the lowest level seen in records dating back to January 2003, National Statistics Institute data showed on Tuesday.

March mortgage lending fell to 6.244 billion euros ($8.72 billion), the institute said.

The decline was slower than the 47.5 percent fall from a year earlier in February. However, the data still showed lending was only about a third of the level recorded at the beginning of 2007, at the height of Spain's decade-long property boom.

Economists say Spain's property and construction industries reached unsustainable levels during the bonanza years, when building accounted for up to 18 percent of gross domestic product.

This was made possible by ready funding available on foreign bond markets for Spanish banks, which then passed on the money to house buyers in Spain. This finance has dried up, making banks much less ready to lend and undermining the cycle of ever-increasing property prices and investment which made Spain outperform other euro zone economies for years.

Spanish gross domestic product (GDP) shrank 1.9 percent quarter-on-quarter in the first quarter, the country's worst contraction in half a century, due to the twin shocks of the global crisis and a housing collapse.

The average value of mortgages fell 13.3 percent in March from a year ago, the National Statistics Institute said, providing another sign of falling prices in a housing market which saw values triple in a decade.

Spain is struggling to become more competitive and to find new industries to fill the gap left by construction. (Reporting by Jason Webb; editing by David Stamp)

There is no let up in the property price crash in Spain as the latest figures to be published show that in some areas, particularly the Costas, the downward trend continues.

Spanish property prices fell by 10% over the 12 months to the end of April, the figures from the property price index published by Tinsa, one of Spain's leading appraisal companies, shows.

Coastal areas were the hardest hit where the high concentration of second homes has meant that the market has seen a large decline in the number of foreign investors. Average prices in coastal areas fell by 13.5%.

Big cities, including Madrid and Barcelona saw the next biggest drop in prices, down an average of 10.3% and the Balearic and Canary islands saw a much smaller fall at 9.2%.

An examination of the yearly figures shows an up and down pattern. Large cities have seen a steady decrease in prices which dropped 1.9% in April 2008 and declined every month until April 2009.

The Mediterranean coast has seen prices zigzag – down 1.2% in April 2008, down 8.3% in august last year and seeing similar large price drops in October and November. Then the steepest decline came in December (-14.3%) and January saw prices fall 12.6%. There was a slight slowdown in the decline in February (-10.7%) but that has climbed again to -11.5% in March and -13.5% in April 2009.

Prices in the Balearic and Canary Islands initially bucked the trend seeing a 1% and 1.4% increase in April and May last year but began falling in June. The rate of decline has been steady since then and reached a peak of -9.2% last month, the year on year figures show.

With the number of foreign property investors declining the government is now trying to encourage Spaniards to buy more property but it latest measure has been criticised as rash. Mortgage relief for borrowers with incomes of €24,000 or more is to be eliminated in 2011. This is supposed to encourage people to buy sooner rather than later.

But developers have criticised the move calling it 'negative' and opposition leader Mariano Rajoy described it as an attack on the interests of the middle classes.

Source: PropertyWire

 One out of four russians interested in purchasing property abroad during the first quarter 2009 focused their search on Spain, according to the Russian property consulting firm Miel DMP, which specializes in property abroad.

The company cites the collapse in the real estate market in Spain as the main cause for the surge in interest for the Spanish property market, which has resulted in some properties being cheaper than in Bugaria and Montenergo.

Spain has become the most popular location for Russians eyeing property abroad, after France (20 per cent), and Bulgaria (15 per cent).

Source: Spanish News

Kylie Minogue is set to buy a house with her new boyfriend in Spain.

The 'In My Arms' singer wants to settle down with model Andres Velencoso, 31, in the Tossa De Mar area of the Costa Brava, close to where his family live.

A source told Britain's The Sun newspaper: "Things are going really well between Kylie and Andres and she has been spending a lot of time in Spain.

"As well as golf, his other passion is scuba-diving, and there are great dive sites at Tossa which he and Kylie have been exploring.

"He lives in New York but goes home at least once a month so it makes sense for them to have a base there."

In preparation for the proposed move, the 40-year-old Australian singer - who started dating Andres six months ago - is keen to learn the language so she can integrate with the locals.

The source added: "Kylie wants to learn Spanish and has been following DVDs. But having a house in Spain will make things easier."

In February, Andres introduced the pop star to his father and sister for the first time during a trip to Tossa De Mar.

Earlier this month, the couple went on holiday together to North Queensland, Australia. During the break, Kylie introduced Andres to her parents and brother.

Source: SKY TV

In the midst of Spain's worst housing crisis in decades, house hunters will soon find an unusual location to pick up a new home at a hefty discount.

Grupo Santander SA, one of Europe's largest banks, is getting ready to launch a Web site on which it will sell as many as 950 new homes to the public at a 20% discount to market prices. That comes after the Spanish bank sold 350 homes to its own employees on the same terms.

Santander's fire sale isn't entirely voluntary. The Spanish bank picked up some 1,300 homes last year when developers to whom it had lent money defaulted on their loans and the bank agreed to swap debt for the property. At the end of 2008, Santander, including Banesto, its Spanish retail bank, had property valued at some €3.8 billion ($5 billion) on its balance sheet, most of that originating from debt-for-equity swaps.

"The goal was to get ahead of the situation and to avoid some of those loans becoming nonperforming loans, avoid lengthy bankruptcy proceedings involving many creditors and to help clients avoid bankruptcy," says a Santander spokeswoman.

The scenario at the Spanish bank is playing out across Europe. With property-loan defaults on the rise, many European banks are knee-deep in loan-restructuring plans.

But as the economy worsens, the pressure on property owners who borrowed against their real estate is mounting. Before the recession is over, the banks will likely end up with more property on their books and could become big sellers of real estate.

Standard and Poor's, the credit-rating company, says delinquency rates on European commercial-mortgage-backed securities have been rising sharply since the summer. In its latest monthly report tracking CMBS, it says delinquency rates on sterling-denominated loans rose to 3.84% in March from 2.8% in February.

For loans denominated in euros, delinquency rates rose to 3.18% from 0.85%. Standard & Poor's monitors 1,100 loans that serve as collateral for European CMBS. Of those, 20 were delinquent at the end of March, up from 15 in February.

"We think the rate of delinquency will continue this year and repeat the pattern that we've seen month-on-month," says Judith O'Driscoll, an analyst with Standard & Poor's in London.

To be sure, many banks remain reluctant to sell despite the increasing pressure from rising defaults on commercial-property loans. Some private-equity investors who have raised cash to buy distressed property complain that they can't do deals.

"Everyone is talking about the big casino, but one very likely scenario is that the big casino will never come because the banks are sitting on the assets and hoping they won't have to sell before the recovery comes," says Eric Sasson, a managing director of Carlyle Group. "It's not a question of price; they just don't want to sell if they don't have to."

But the longer the recession lasts, the greater the pressure will be on the banks to sell. "They may not be able to hold onto the property because of their need for capital," says Mike Birch, a loan-workout specialist and founder of REAM Capital Partners, a real-estate asset-management company. "In the end, I don't think the banks will have the luxury of hanging on to the property for long."

So far, there has been a dearth of sellers in Europe. The volume of real-estate investment in Europe fell 44% to €11.5 billion in the first quarter of 2009, from €20.6 billion a year earlier, according to property consultant CB Richard Ellis.

"The banks on the whole want to avoid selling too cheap and allowing someone else to profit on the recovery," says Philip Cropper, director of CB Richard Ellis' real-estate finance services in London.

Source: Wall Street Journal

MADRID, April 21 (Reuters) - The number of foreign tourists visiting Spain in March fell by a fifth compared to a year ago, with British numbers undermined by recession and the weak pound and hurt by Easter falling outside the period.

Data from the tourism ministry on Tuesday showed 3.4 million tourists visited the world's second most popular destination last month -- 20.8 percent fewer than a year ago or 10.1 percent down when corrected for Easter falling in April.

Such a sharp fall will alarm Spain's second biggest industry after the devastated property sector. Tourism employs one in seven Spanish workers and made 42 billion euros ($54 billion) from the 57 million foreigners who holidayed there last year.

The March fall compares to a previously-reported 15.9 percent decline in February, which the tourism ministry said it had revised to a fall of 11.3 percent on Tuesday because of "calendar effects".

One of the biggest worries for industry bosses will be the fall in British numbers, down by a quarter in March.

Spain's biggest origin market is reeling from one of the worst economic crises in Europe and the weak pound makes euro zone countries such as Spain more expensive, and competitors like Turkey, Croatia and Egypt more attractive.

Lobby group Exceltur said 100,000 jobs in the industry will have been lost by next month compared to May 2008 -- the last time tourist numbers here rose. Spain's unemployment rate is already the highest in the OECD at around one in six workers.

"The crisis has affected us a great deal," said Exceltur Vice President Jose Luis Zoreda, adding that foreign visits would fall 6 percent and hotel stays by 8.1 percent in 2009.

A price war raging across the hotel, car rental and transport sectors was savaging profits as businesses scrap for custom, he said.

"Profits have fallen across the board and with great intensity," he said, adding that 42 percent of businesses were now loss making, and forecasting a 6.4 percent drop in sector income this year. (Reporting by Ben Harding; editing by Stephen Nisbet)

Source: Reuters

 British expats living in some of the most sun-drenched retirement hotspots around Europe have been using EU law to make sure they get every penny of their UK benefits this winter. An article in the People newspaper this week has revealed that up to £14million in winter fuel payments have been claimed by people living overseas permanently.

 Hundreds of Britons living in Spain are fighting to save their homes after becoming involved in an alleged multi-million-pound fraud involving the collapsed Icelandic bank Landsbanki.

Up to 600 expats were persuaded to raise money against the value of their properties to invest in a fund run by a subsidiary of Landsbanki.

Many raised hundreds of thousands of pounds in the scheme, which was advertised in local newspapers, and took up to a quarter of the money in cash – sometimes to cover medical bills – while the other 75 per cent went into the investment fund.

The Britons claim they were assured by financial advisers that the returns from the money in the fund would cover the interest they were being charged. Such schemes have been banned in Britain since 1990.

But the expats say that, even before the bank failed in October, the fund was deteriorating and many of them now risk having to sell their houses to meet spiralling debts or see them repossessed. A few are understood to owe millions of pounds.

Lawyers acting for a group of the investors have now launched a legal action against a number of financial advisers and the bank, accusing them of misleading publicity and fraud.

The claims are being examined by a court in San Roque and a prosecutor is investigating whether there is a criminal case to answer.

Among the alleged victims are Gillian and Roy Birch, who moved from Britain to Alicante in 1986 but suffered financially in the late Nineties.

When they saw advertisements for the scheme in local newspapers, they thought it was the answer to their problems. Although initially cautious, they were eventually won over by local advisers after being told that it could save them thousands of pounds in Spanish inheritance tax when one of them died.

They have since found out that the scheme did not affect their tax position. ‘This calamity has totally devastated us,’ said Mrs Birch, 83. ‘We have both been through hardship and danger in our lives. My husband, who is 86, flew Lancaster bombers in the war and I drove an ambulance in the Blitz.

‘We have both worked hard since and were convinced that we would have a tranquil retirement, and now this. We have had many a sleepless night.’

Les Maffey, 72, who moved to Spain in 2000, raised €315,000 (£283,000) under the scheme when his wife, Irene, was diagnosed with lung cancer. Her treatment cost €50,000 (£45,000) but she died aged 65 in 2007.

Because of the poor performance of the fund, higher than expected management costs and the collapse of Landsbanki, he now owes more than €100,000 (£90,000).

‘If I were to sell my property, I would be left with a debt I would have to meet out of my savings,’ he said.

‘As a result of the stress caused by the worry of losing everything we worked all our lives to achieve, my own health is suffering.’

Mike McInnes, who has set up the Landsbanki Victim Action Group, said they hoped a Spanish judge would block any attempts to repossess their homes.

The 62-year-old businessman, who lives near Marbella, said that because house prices had plunged, many investors would no longer be able to clear their debts by selling up.

He said that his home was valued at €800,000 (£719,000) when he and his wife Julie, also 62, took out their loan in 2005. Their debt is currently €500,000 (£450,000), about the same as their house is now worth, and they have a relatively small pension.

He hopes the debts may be written off or significantly reduced if the bank was found to be in breach of Spanish law.

‘We were told our money was safe but there are hundreds who could lose their homes,’ he said. ‘It is a complete mess.’

The Luxembourg subsidiary of Landsbanki, which is in the hands of administrators, declined to comment.

Source: Daily Mail

Real estate brokerage firms have truly been decimated by the collapse in the construction and real estate buying sectors. Only 25,000 real estate companies have survived the crisis of the 80,000 that were registered in the summer of 2006 when the construction boom was in full swing, amounting to a 70% decrease in real estate brokerage firms, with 180,000 lost jobs according to sector estimates reported by La Vanguardia newspaper.

The haemorrhaging occurring in the sector is far from over since, according to the president of the college of real estate agents of Barcelona, Joan Olle', real estate agencies will continue to close for all 2009, and less than 20,000 will survive at the end of the year. However ''not all bad things are necessarily harmful,'' underlined Olle', who regards the real estate crisis as a phenomenon that ''has allowed purging of the sector that was teeming with makeshift businesses, which were often only equipped with a mobile phone and were not professional''.

In Catalonia, the cuts will be even more drastic, since home access laws, which will be effective after this summer, require real estate brokers to enrol in an ad hoc register and to take out insurance, with deposit and civil liability funds. Olle' also predicts that in Catalonia, at the end of 2009, not more than 3,500 real estate agencies will survive.

The leading companies on the market are also having difficulties dealing with sales that have decreased over 80%, from all-time highs in 2006, despite dropping real estate prices, which have been estimated to be down 12% in cities like Madrid and Barcelona. The top Spanish real estate business, Technocasa, which had 1,400 agencies in 2006, ended 2008 with 308 sales points, revenues down 57%, and predicts further decreases.

Other large firms, like Expofinques, Mc, and Don Piso of the Habitat group, have failed, and have been forced to start a concurrence of creditors, the legal process of receivership. Coldwell Banker, a major real estate company on a global level, which in 2007 had 66 offices in Spain, closed its offices in the country.

Many real estate agencies are trying to handle the crisis by diversifying their business, which is now more oriented towards renting, for which demand is slightly increasing. Both on the Internet and through agencies, low-cost sales are progressing for homes that are non-new builds, with discounts of up to 40% on estimated market values.

In June in Barcelona, the first low-cost fair in the sector will take place, with prices reduced by at least 30%. According to Olle', the real estate crisis may have already bottomed out with a collapse in sales, and should start to rise again in the next six months, but increasingly, sales will be directly between individuals, through the Internet, and without added brokerage costs.

Source: ANSAmed

The British love affair with Spain appears to be on the wane after new figures showed tourists heading for the Costas fell by 23.4 per cent last month.

Figures from the Spanish Tourism Ministry released on Monday showed the number of British tourists dropped by almost a quarter compared with the same period in 2008.

The fall in the value of the pound combined with the effects of the recession were blamed for the decrease in British visitors who still make up the largest nationality of foreign tourists.

Overall, the number of tourists visiting Spain fell by 15.9 percent in February compared to the same month a year earlier, the sharpest fall since Spain’s recession began to hit the country’s second largest industry.

Tourism provides more than 10 per cent of Spain's gross domestic product.

Just over 2.8 million tourists came to Spain in February, which is one of the quieter months of the year.

Of these, 51 per cent were Britons or Germans. The number of German tourists fell by 18. 6 per cent in February.

After this, the French, Italians and tourists from Holland and the Belgium were among the largest nationalities to come to Spain. All showed reductions in the number of visitors.

The number of tourist arrivals has fallen every month since June last year.

In terms of regions, Andalucia showed the largest fall in visitors with 23 per cent less in February compared with the same period last year. This was followed by the Canary Islands at 15.1 per cent, then Catalonia with 11.4 per cent fewer foreign tourists.

Among Spaniards, Andalucia, Valencia and Catalonia were the most popular areas. All showed falls in visitor numbers of 11.2 per cent, 10.4 per cent and 13.5 per cent respectively.

As the world economic crisis gathers pace and unemployment rises, holidays are often one of the first things to be cut from the family budget.

Data from the Spanish National Statistics Institute showed almost exactly the same trend with regard to hotel stays in February.

The number of paid hotel nights fell by 15.5 percent, after a 12 per cent drop the month before.

The decrease is particularly worrying for hotel chains as it came after a 5.1 decrease in the cost of the average cost of a hotel room compared to February 2008.

Major hotel operators like NH and Sol Melia have been offering large discounts in an effort to lure tourists and business travellers. A night in a five-star hotel may cost as little as €60 euros.

The Spanish Index of Hoteliers’ Incomes showed a year-on-year fall of 3 per cent – or 1.5 per cent less than in January. This also represents a 4.6 per cent decrease compared with the same period in February.

Spain is the world’s second most popular tourist destination after France.

But it has been recently trying to dispel its traditional image as a sun, sand and sea destination.

Prince Felipe and Princess Letizia, the future heirs to the Spanish throne, recently travelled to New York to help publicise a campaign to modernise Spain’s image in the eye of potential American tourists.

Source: Times Online

idealista.com has published a list of the 50 cheapest new properties in Spain.  These properties are all brand new and have been finished and waiting for the first owner.

The cheapest is in Ciudad Real and costs 42,000 Euros and the most expensive is in Avila and costs 84,000 Euros.  Some are near the mountains and some near the sea.  Makes interesting reading.

 A court decision in Spain has opened the way for thousands of UK citizens to reclaim some of the tax they paid when they sold their homes there.

A block of apartments in Spain owned by British, Dutch and French property investors is to be demolished.

Owners of property at the illegally built Sun Village development of 40 flats with communal gardens and a pool in Palau-saverdera, on the Costa Brava have six months to comply with a demolition order.

Catalonia's High Court ruled in 2006 that the property development was illegal but owners and the local town hall have spent years trying to prevent demolition.

Their efforts have now failed and the Mayor has started proceedings to demolish the buildings. Owners want compensation and are demanding €310,000 each.

The saga began 2001, when Mayor Narcís Deusedas approved the development of the private apartments on land zoned for public facilities.

There was planning permission for a hotel but when building started and locals realised what was going on, a campaign began to have the development knocked down. The buildings were also higher than allowed in the planning licence.

Only two of the apartments are occupied all year round. The rest are second homes or rented out during the holiday season.

One 62 year old owner said he has nowhere else to go. 'I don't know what will become of us. Knock it down if they must, but we should be compensated,' he said.

'The Mayor is to blame. He gave the licence and when the problems started he promised that he would legalise the situation,' said another.

The Mayor has said that the town council cannot afford such a high level of compensation. But he has agreed to engage a lawyer to discuss the issue with the property owners.

Source: PropertyWire

 MADRID - Spanish police arrested the mayor of a small town and 12 other people in a real estate fraud case involving home sales to foreigners.

The Interior Ministry says the Socialist mayor of Alcaucin in southern Malaga province allegedly accepted bribes to allow construction of homes in nonresidential areas.

The ministry said in a statement that those arrested Friday included real estate promoters, members of the mayor's family and two architects.

Corruption has become a major issue before regional elections Sunday in the Basque region and Galicia in the northwest.

One probe has implicated members of the conservative opposition Popular Party. The opposition has in turn accused the government of putting pressure on the judiciary.

Source: MSNBC