Building and Contents Insurance Cover.

Just read Justin's excellent newsletter article under the same title ( http://clicks.aweber.com/z/ct/?fvOSTHFBFe5sX3SLtjXr1g ).

The article concludes:

"So if you are out to bag yourself a bargain then you may not find it as easy as the press make it out to be.  We are guilty of this ourselves and recently talked about a “buyers market”.  It’s only a buyers market in terms of choice, not necessarily price."

My point, exactly, Justin!

On June 2nd I posted the following:

"Of course it's easy to buy - there's always plenty of property available, which is why I don't accept this "it's a buyers market" thingy. It's always a buyers market inasmuch as there's always something to buy if you're determined enough, but good properties in good locations aren't exactly being given away. It took me about 7 months constant hunting to find my latest project. But it's just as much a sellers market, if you happen to have found yourself a property that people want to buy. Sure, the potential returns aren't what they were, say, 5 years ago, but if you aren't greedy and do your "research", you can still make a decent investment." 

(You can find the rest of my post on this thread:   http://www.eyeonspain.com/Secure/ForumPosts.aspx?thread=454&dev=FB11&name=General chit chat )

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Should read these forums more often really  or maybe you should write some more of your brilliant articles for us Rob!

We've been looking at different properties now for over 12 months.  We've driven our agent mad but we've been really struggling to find the right property.  There's a lot of choice bit it's not always the right choice.  Finding the right property is hard but we are prepared to pay the going rate for the right property, just not the going rate for the wrong property...if that makes any sense.

Anyway, glad we're on the same wavelength, makes me feel better

Justin

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On the contrary, Justin, your article made me feel better, because I had tried making my point about the so-called buyer's market a couple of months ago when all the doom & gloom stories in the press broke, but it seemed like I was the only one who didn't buy it. You put it across much better than I could - but then, that's why you're the Boss! Admittedly Rixxy did invite me to go on the Trev McD program in the hope that I might offer a different perspective, but in retrospect it's probably just as well I didn't. Firstly, they clearly would not have been interested in my views and would have given me even less air time than they gave you (at least your mum got to see you on TV!), and secondly, it seems that the market has certainly slumped somewhat, and I may have now appeared to some to have a little egg on my face.

However, as you pointed out in your article, many sellers simply aren't prepared to drop their prices. I can certainly vouch for that, because I have a property currently on the market, and despite the slow trickle of interest, I know that it's only a matter of time before confidence begins to return. Furthermore, I have utmost confidence that the property is a desirable one, for which a "lifestyle" buyer will gladly pay what I believe it's worth. (Or close to it - naturally, I'm prepared to negotiate, even though many Spaniards definitely will NOT). Also, I've been careful not to over-extend myself on any property. In other words, I can afford to sit on it for a while.

I know exactly how you must have felt when searching for your own property. Believe it or not, we viewed 65 apartments before buying the one we live in now! (Now you know how I got to know all about Spanish estate agents, and why some people even suspect me of being one!) We were also prepared to pay the asking price for several that we saw, only to find various obstacles put in our way, ranging from the seller expecting us to pay his capital gains tax, the seller expecting us to wait 6 months so that the completion date would suit him better with regards to his "fiscal" circumstances, to the seller simply putting the price up because the agent mentioned that we were extranjeros (Sorry to be un-PC, but it happens). It certainly didn't feel like a buyer's market then, but the fact that there were 65 apartments available to view suggests that there was no shortage of property on the market even then - this was over 4 years ago. So what's changed?

I don't know, to be honest. Although in terms of new build property at least, there is definitley a case of over-supply now, I can't help feeling that the current "property crash" was largely brought about by people believing what the papers were saying. I tried posting positive comments at the time, because I was thinking that with all the bad press, a collapse in confidence was almost inevitable. Unfortunately, mine is only a little voice. This may be a rather naiive outlook (I am, after all, just a bear with a very small brain), but I have always thought of property as more of a long term investment, and making a quick and tidy profit on it is possible, with a bit of luck and good timing, but certainly not easy. The same, in fact, as with the stock market. I, like many others, had some investments which took a big hit after 9/11, but instead of bailing out, I stuck it out, and now (even after recent jitters) they're doing quite OK. These things always seem to be cyclical, so as long as you can afford to weather the occassional storm, there's no need to panic.

So, to return to the original topic, there are very few apparent bargains out there because the really good properties will always retain their value. But that value cannot always be measured purely in monetary terms, since there are many other reasons why people will continue to buy property in Spain other than just "cheapness".

 

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What I found interesting was that when I was talking to several agents they were telling me that over the summer the people who were over looking for property were all putting in ridiculously low offers on the properties that they were interested in, obviously following comments in the press of a depressed market.   Most of the sellers didn't budge but I know for a fact that August was a very bad month for many agents.

I don't think we're going to see things getting worse now, I think we'll start to see some confidence slowly coming back now as people.

Will be interesting to see how things develop over the coming months.

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Hi guys, have to add my pennyworth! I agree with both of your views, Roberto, 4 years ago I too saw this coming and therefore started the auctions. Concentrating on the oversupply and offering a get out for speculators who were going to get cuaght

Prior to this I had worked for one large agency on the admin side and could see even in 2000, 70% of buyers were investors wanting to flip to make money!

I realized then they were going to create this problem as if they are going to make money and flip they dont care what they actually pay!! And so we are in the mess we are in

I tell sellers if they can hang in for the next 5 years then do so, the prices will dip then come back to where they are now. If they cant for whatever reason, drop the price and run now as its going to get worse before it gets better

Im glad Justin you said about august being bad, cos others Im talking to are saying how busy they have been.

Pants!!! I had around 3 calls per day through august! We are not ground floor and so dont have the holidaymakers walking in every 5 minutes bored so deal with actual real interested people. Our web viewing figures dropped last week but I think thats cos peeps still on hols and before the kids go back. I have had more interest with the fones picking up but from sellers for the next auction, but again they wont listen re the price, and in one case the figures wont work out for the seller as he paid way over the odds!

Good proerties will sell at the right price and with 2 types of buyers, the lifestylers will pay the going rate, but investors are getting hard now and silly offers are being put in all the time

This will be the trend for the next few years.

See you later

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thought this might be of interest:

Foreign investment in Spanish property up by 19%

Figures from the Bank of Spain reveal that foreign investment in Spanish property increased by 19.2% in the first 5 months of the year compared to the same period in 2006. The amount invested by Spaniards in property outside of Spain almost doubled over the same period.

The total amount invested by foreigners to the end of May was 2.252 billion Euros, almost the same as the amount invested in 2005, though still significantly below the 2.925 billion Euros invested in the peak year of 2003.

How does one reconcile this increase in foreign investment in Spanish property at a time when the market is clearly turning down?  

One explanation might be that many of the off-plan sales made in 2004 and 2005 are only now being recorded as investments as buyers take possession of their properties and complete the purchase before notary. This is the moment when the investment is recorded in the national accounts.

Nevertheless, the figures do seem to suggest that foreign demand for Spanish property has picked up significantly since last year, even though property professionals report that the market is still very slow. By the end of the year we should know whether foreign demand has rebounded, or whether these figures can be explained by some other factor.

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I agree with you Chelseadel, the likely ecplanation is that the completions are now taking place fr properties effectively reserved 2-3 years ago, therefore this figure will be rising (falsley) over the next 1-2 years until it all adjusts.

And this means more stock on the market as speculators are forced to complete to save their deposit money! Hoping to rent out or resell to recoup their investment

Thats why I reckon another 5 years to go before it starts to pick up

Bear in mind this is a false economy here on the Costas, based on tourism and foreign buyers. Its the first time ever that although a very stable and mature market, it has been subjected to such oversupply without the benefit of a solid workforce earning the money to support it.

Ie in the UK late 80s early 90s, people would struggle to pay the mortgage, the banks would bend over backwards to help and even the courts would be lenient. People have to live/work in the UK - here its based on lifestyle and extra income!

It will be interesting for sure to see how it all oans out and I am pleased to report business picking up and the phone ringing more since the end of the holiday season!! 

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Another interesting thing I noticed today is that there are far more properties to rent in today's Sur in English than to buy. Normally it's the other way round, so there could well be a connection? Lot's of new builds, recently completed on because they couldn't flip them, so now forced to rent them to try to cover costs?

Glad to hear biz is picking up Rixxy. Guess that means you'll have to get back to the office now and leave the beach? I also feel things are looking up. I had two viewings today of my property (I only need one to say yes!) and I spoke to an agent I've not met before, and he didn't actually seem suicidal  He was very keen to list my property and seemed confident he could sell it. Didn't even take a sharp intake of breath when I told him the price.

Come on folks, let's have some more positive thoughts!

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Hi Roberto - thought I would 'spend' my 1000th posting on this thread!! Yes from end of last week it has not got massively busier but noticeabley people are back from their hols - finally!

Bit of a nuisance really as Ive been in the office for 4 11 hour days! Back to normal but hard work!!!!!!!!!!!!!!

I have had quite a few viewings going on and anything from the cheapies to large villas so the reange is good. I think the news is out there about checking the commissions as well as numerous buyers ask me now!!! And boy am I so so glad to tell them!

The weather hasnt been brill for the beach, not bad saturday but was working most of the day, sunday was pants!!

The main reason there are far more properties to rent is that the holiday season has finished so they are ready for long term rentals, and yes more have completed as they cannot be sold. Loads are unfurnished - no good for most tenants whereas part furnished is much better. Also tenants move around now and agents know there is hardly any point trying to rent out long term now.

Good luck with yours, hope it goes and I suspect the season will stay until mid november then dead for xmas, back up end Jan til mid june! As long as my crystal ball doesnt let me down!

Take care!!!

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Hi Rixxy, I would stick a piccy of congrats for your 1000th post, but I dare not.

So anyway, CONGRATULATIONS on your 1000th Post RIXXI

and thanks for sharing your knowledge.

This message was last edited by Karensun on 9/11/2007.

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Stick it in the bucket shop!!

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Smiley, I haven't got the energy!!!!!!!!

 

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Looks like all the property bargains are now on Coto Real, I have just had an email from Barrington homes and got an awful shock at how much they have reduced the price of the apartments.  Wish I had of hung on now before buying there.

COTO REAL PRICES & RENTAL FORECAST

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What do Barringtons use to estimate rental income, a Crystal Ball or Some wet Seaweed

sounds like salesman spiel to me

John

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Still overpriced!

 

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And Karensun, thank you for noticing - its a load of energy to write that many posts!

Smiley - dont be grumpy!

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