Hi all,
Regarding the question would this happen in the uk?
I worked for a very large,very reputable agent in the Uk for many years working with strict guidelines and being trained to the hilt with corporate mentality.
There was a huge development of apartments developed in the middle of the town centre and i do mean in the middle of the town centre!
They sold like hot cakes and they were backed by one of the large high street lending institutions so there were never any questions asked.
A 2 bed apartment was £140,000 and reached £200,000 in the boom, investors were buying in blocks of 4&5's for the rental income as the complex had underground parking,concierge,24 hour security,gym and swimming pool on the ground floor.
It was to be the flagship development of the town and the way forward.
As expected they all sold out.
Because of the nature of the business and the investors who needed rental income they soon became full of tenants,these unfortunately were not always desirable as the landlords looked to fill them and not necesarily always were to concerned where the money came from,this resulted in the block gaining a rather unsavoury reputation,don't forget these were originally marketed at the upwardly mobile as a start of the development!
As the market slowed and a lot of these so called investors or property developers got into financial difficulties they began to be repossesed by the banks in groups of 5&6's,then then came back to me as i was head of the corporate business by then meaning that the banks would pass the property on to us and we would then have 12 weeks to sell before they would go to auction,very similar to what i am doing here now.
We would have to market them at a realistic price in the hope of a quick sale.
The first one i got was marketed at £120,000 three years after completion!!,i had a buyer and approached a high street bank for a mortgage for them,it was refused!i then approached three more and again refused.
I then approached the bank that had financed a percentage of the project originally as they surely knew the build and would issue a mortgage.
Not a chance!
When the building was originally planned it was deemed as and planned to be a commercial premises and obviously with the location it all started to make sense,the surveyors refusal to grant permission for a mortgage was this plus the fact it was of concrete and steel consruction,"but you were the original lenders i said" stoney silence,"i am afraid no mortgage can be issued on any property in that block".
The only way we could sell the property was for cash and we never did they were all sold at auction achieving on average £89,000.
So when you next think that Spain is so corrupt and that nothing like this would never happen in the UK don,t be so sure!
Although the "bandwagon" will soon have to be bought out by virgin trains to cope with the capacity Spain is a great place to live and hopefully always will be!(my job depends on it)
All the best
Georgia